Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares in bluebird bio (NASDAQ:BLUE) jumped by 10% earlier today after the company reported encouraging results from a phase 1/2 trial evaluating Lentiglobin BB305 for use in beta thalassemia and sickle cell disease.

So What: Bluebird bio's BB305 is a gene therapy that inserts a functioning beta-globin gene into a patient's own hematopoietic stem cells outside the body. Afterward, those cells are injected back into the patient's bloodstream in a process known as autologous stem cell transplantation.

The clinical stage company plans to present data at the 20th Congress of the European Hematology Association in Vienna, Austria, on June 13 showing that two BB305 patients with beta thalassemia major remain transfusion independent. One patient is transfusion independent 14 months following transplantation with stem cells altered by BB305, while the other patient is transfusion independent for 11 months following transplantation with stem cells altered by BB305.

Bluebird bio also noted that one patient with sickle cell disease that received BB305 therapy has encouraging hemoglobin levels 4.5 months after transplantation that suggest a potential to reduce or eliminate serious and life-threatening events associated with this disease.

Now What: On May 19, bluebird outlined its regulatory strategy for BB305, indicating that results from this study, its Northstar study, and two other upcoming studies, could serve as the basis for an eventual FDA filing for approval. Bluebird bio also noted that results from this study and the Northstar study could allow for conditional approval in Europe, with full approval coming after successful completion of the other two future trials.

If approved, BB305 would offer new hope to patients diagnosed with beta thalassemia major, a blood disorder caused by an abnormal beta-globin gene creating defective red blood cells that requires constant, ongoing blood transfusions in order to treat anemia. However, investors should remember that bluebird bio is a development stage company without any approved products on the market. Since bluebird bio's shares are already trading at levels that give the company a $5.4 billion market cap, a lot of BB305's potential may already be reflected in its share price, which is why I'm hesitant to chase this stock higher.