Crispr Therapeutics could have a "functional cure" for two inherited blood diseases, analysts said Monday, but CRSP stock plummeted.
The dive took place amid broader market concerns over inflation. But analysts were impressed by the gene-editing approach to sickle cell disease and beta thalassemia.
After a single infusion, all but two beta thalassemia patients no longer needed blood transfusions, a common treatment for the disease. Further, vaso-occlusive crises disappeared for the sickle cell patients following treatment. These recurrent attacks are a hallmark of sickle cell disease.
On the stock market today, CRSP stock tumbled 13.3% to 55.27. Shares of Crispr partner Vertex Pharmaceuticals fell 3.7% to 245.39. Their moves into the red reflected a similar dip for biotech stocks. The SPDR S&P Biotech exchange traded fund toppled 5.5% to 63.32.
CRSP Stock: Long-Term Follow-Up
Crispr and Vertex tested their gene-edited drug in 75 patients — 44 with beta thalassemia and 31 with sickle cell disease. They followed patients for roughly one month to over three years after the infused treatment.
Although two beta thalassemia patients still needed transfusions, they reduced the volume of those by 75% and 89%. All patients had substantial increases in fetal hemoglobin. These red blood cells are typically low or absent in patients with beta thalassemia.
Bullishly for CRSP stock, all 31 patients with sickle cell disease remained free of vaso-occlusive crises during a follow-up period of two months to nearly three years. The average fetal hemoglobin levels in this group increased by roughly 40% after four months.
The results are "consistent with a functional cure for both (blood diseases)," SVB Securities analysts said in a report to clients. The analysts have an outperform rating on CRSP stock.
Side Effects Remain Concerning
However, safety remains a concern. Patients must undergo pretreatment with busulfan before they receive Crispr and Vertex's gene-edited drug. Busulfan is a chemotherapy.
One patient experienced a brain hemorrhage less than three months after receiving treatment. The companies said the side effect was related to busulfan. That could cause some uncertainty for patients, RBC Capital Markets analyst Brian Abrahams said in a note.
"While sickle cell disease patients are increasingly open to advanced cell therapies, some reticence remains, which coupled with potential limitations in transfusion, could limit or slow a sickle cell disease launch," he said. "Pricing pressure in the European Union, where transfusion-dependent beta thalassemia is more prevalent, are also a potential headwind to profitability."
Abrahams has an outperform rating on Vertex stock, but doesn't have a rating on CRSP stock.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
