Cathie Wood's success is based on two main things: finding innovators and betting on them for the long term. The founder and chief executive officer of Ark Invest goes for innovators in all areas, from information technology to healthcare, and this helped her flagship Ark Innovation fund outperform the S&P 500 Index by a mile last year. Ark Innovation soared 67%, which the benchmark index advanced 24%.
One of Wood's favorite technologies, in the area of healthcare, is gene editing, and last week, she increased her bet by adding to her holdings in two top players: CRISPR Therapeutics (CRSP 1.25%) and Intellia Therapeutics (NTLA +4.08%). The former recently reached a huge milestone, and the latter is heading for several catalysts over the next two years. Let's check out these top Cathie Wood stocks.
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1. CRISPR Therapeutics
CRISPR Therapeutics is the biggest holding in Wood's healthcare fund -- Ark Genomic Revolution -- with an 8.1% weight. This company -- and Intellia -- both specialize in "CRISPR" gene editing, which involves cutting the genome in a particular location and allowing a natural repair process to take place. The idea is to fix faulty genes responsible for disease, and the result can be spectacular, producing functional cures.
CRISPR Therapeutics reached an enormous milestone late last year when the UK authorized Casgevy, its treatment for blood disorders, marking the first ever regulatory nod for a CRISPR-based therapeutic. The U.S. went on to approve Casgevy in its two indications, sickle cell disease and beta thalassemia.
NASDAQ: CRSP
Key Data Points
The gene editing specialist is partnered with Vertex Pharmaceuticals for this particular product, and this represents a big advantage: Vertex, an experienced player in manufacturing and commercialization, is at the helm here and bears the largest share of development costs -- 60%. Even though Vertex also takes 60% of profits, this deal is a smart one for CRISPR Therapeutics, allowing the company to pocket its first ever product revenue and focus on pipeline growth.
And speaking of the pipeline, CRISPR Therapeutics also is advancing promising immuno-oncology candidates through clinical trials, so if all goes well, the biotech could bring at least one additional product to market later this decade.
All of this means now makes a great time to follow Cathie Wood's lead and get in on this innovator early.
2. Intellia Therapeutics
Intellia currently makes up a little more than 3% of Wood's healthcare fund, as the 14th largest position. The company doesn't yet have a product on the market, but it's reached an important point, with many catalysts just ahead.
First, it's important to note that the regulatory approvals of CRISPR Therapeutics' product is positive for companies in the CRISPR gene editing field, indicating regulators are willing to help bring such treatments to market if trial data are strong. Another plus is Intellia and CRISPR Therapeutics are focusing on different disease areas, so at the moment, they aren't competitors.
NASDAQ: NTLA
Key Data Points
Intellia's most advanced candidates are NTLA-2001, treating transthyretin amyloidosis (ATTR), and NTLA-2002 for hereditary angioedema (HAE). ATTR is caused by accumulation of a misfolded protein and impacts various organs such as the heart, while HAE is a condition characterized by sudden and extreme swelling.
The company's priorities from now through 2026 include completing patient enrollment for pivotal studies of both of these candidates and applying for regulatory approval of NTLA-2002. Intellia also plans on launching a wave of clinical trials for new candidates during this time period and innovating in the area of gene editing and the delivery of these potential treatments.
Meanwhile, trial data reports could determine the direction of the shares over the next couple of years. And speaking of the share price, Intellia shares have shown movement similar to those of CRISPR Therapeutics over time, but the stock price remains significantly lower.
It's possible, though, that positive data readouts and an eventual product approval could help them catch up with their more advanced peer. Considering the company's progress so far, it's not surprising Wood is loading up on shares -- and if you're comfortable with a bit of risk, you may want to add a few to your portfolio too.
