CRISPR Therapeutics (CRSP 0.95%) and partner Vertex Pharmaceuticals just took another step closer to launching a potential game-changing product. At the same time, the U.S. Food and Drug Administration (FDA) did something that may enter the record books.
The FDA's acceptance of the CRISPR Therapeutics and Vertex files marks a first. It's the first time the FDA has agreed to review a candidate that relies on the CRISPR gene editing technique.
The potential product -- exa-cel for blood disorders -- may add to Vertex's blockbuster revenue. But for CRISPR Therapeutics, it could be even more important. Could it signal a big turning point for the biotech company?
The CRISPR gene editing technique
CRISPR Therapeutics works with a technique called "CRISPR gene editing." CRISPR is an acronym for "clustered regularly interspaced short palindromic repeats" of genetic information. Some bacteria use CRISPR as part of a defense against viruses. But CRISPR Therapeutics uses it as a way of fixing faulty genes that are responsible for certain illnesses.
The CRISPR technique involves cutting DNA at certain locations and allowing a natural repair process to happen. The technology is so powerful that it not only can treat a disease, but could also represent a functional cure. That's the case with exa-cel. CRISPR Therapeutics and Vertex have developed it as a functional cure for blood disorders beta thalassemia and sickle cell disease.
These diseases have limited treatment options right now. And data from clinical trials has been very promising.
Exa-cel met primary and key secondary endpoints in trials for both disorders. In beta thalassemia, almost 89% of patients didn't require blood transfusions for at least 12 consecutive months. In sickle cell disease, 94% of patients remained free from pain crises typical of the disorder for at least 12 consecutive months.
The FDA granted exa-cel priority review for sickle cell disease. That speeds up the review process for candidates that, if approved, represent significant improvements to current treatments.
The FDA is set to decide on exa-cel for sickle cell disease in December. The agency plans on issuing a decision for beta thalassemia in March.
NASDAQ: CRSP
Key Data Points
A positive signal for the technology
All of this is important for CRISPR Therapeutics for two reasons. First, a potential FDA nod would be a big positive signal for the company's gene editing technology. That's because this is a technique the company uses in candidates across its pipeline.
Of course, a positive decision here doesn't mean the technique will be successful in every indication. But it would confirm that the technology works -- and has the potential to treat other diseases. The fact that the FDA accepted exa-cel for priority review in one indication is a good sign.
Second, an approval represents CRISPR Therapeutic's first product revenue -- and it could be significant, considering the need for such a treatment. Commercialization could set the company off on the route to revenue growth and eventual profitability.
This is a huge step for a biotech company. Biotechs generally work for years relying on grants and collaboration revenue to fund their pipeline programs. Adding product revenue to the equation reduces the risk for a company and its investors. Now, more cautious investors may take an interest in CRISPR Therapeutics' stock.
A turning point?
Let's get back to our question: Could this move by the FDA signal a turning point for CRISPR Therapeutics? It's true that many investors expected the agency to accept the filing -- and even to offer at least one indication priority review. This isn't a huge surprise.
But it still represents a big turning point and a very positive one for the company because it brings CRISPR Therapeutics a step closer to the finish line. It also shows the FDA views exa-cel as a potential game changer.
Finally, because exa-cel is the first candidate using CRISPR techniques that the FDA is reviewing, the spotlight is on CRISPR Therapeutics. A potential approval could result in other companies seeing the technology's potential -- and seeking licensing agreements or collaborations. This may result in more revenue for CRISPR Therapeutics over time.
This clearly looks like a key moment for CRISPR Therapeutics -- and its investors.
