Investors React Negatively Despite Positive News
In a groundbreaking development, patients who underwent a single gene-editing infusion displayed significant and sustained improvement in a genetic disorder that can be life-threatening if left untreated. The positive outcome of Friday's Phase 1 study is not only a boost for genetic medicine but also a testament to the capabilities of Intellia Therapeutics (ticker: NTLA) – the company responsible for the treatment. However, Wall Street investors seemed to have lost faith in the slow progress of genetic therapies, leading to a decline in the stock prices of Intellia and other companies utilizing the Nobel-prize winning technique, Crispr-Cas9.
Intellia's stock experienced a sharp drop of 16% in morning trading on Friday before eventually stabilizing at a 7% loss by midafternoon, settling at $63.90 per share. Despite this seemingly negative response from the market, RBC Capital Markets analyst Luca Issi regarded the early-phase study as a favorable outcome.
The selling pressure was evident across all companies involved in Crispr medicine. CRISPR Therapeutics (CRSP) saw a 7% decrease in share value, while Editas Medicine (EDIT) experienced a decline of 11%. Caribou Biosciences (CRBU) and Beam Therapeutics both witnessed drops of 13% and 8%, respectively. Utilizing the Crispr gene-editing approach, which targets specific genes to disable or rewrite harmful sections of DNA instructions, these therapies have the potential to induce permanent changes in our genetic makeup.
Despite the market reaction, an Intellia spokesperson addressed Wall Street's skepticism and reassured that the biotech company remains focused on its mission to benefit patients. The spokesperson acknowledged that it is challenging to explain every fluctuation in stock prices.
Promising Results for Hereditary Angioedema Treatment
Intellia's Phase 1 interim results, unveiled at a Berlin medical conference on Friday morning, provided valuable insights into the potential for a permanent solution to hereditary angioedema – a condition characterized by dangerous swelling throughout the body due to a miswritten gene in liver cells producing a problematic protein.
Notably, the one-time treatment led to a remarkable reduction of over 90% in blood levels of the troublesome protein across the six patients involved in the study. This effect surpassed the impact achieved by chronic administration of the approved drug Takhzyro, developed by Ionis Pharmaceuticals (IONS) and marketed by Takeda Pharmaceutical (TAK). Furthermore, the frequency of swelling attacks also decreased significantly.
These extraordinary findings serve as an indication of the immense possibilities offered by gene-editing techniques and pave the way for further advancements in the treatment of genetic disorders.
Angioedema Results Show Promise for Intellia
The latest results for angioedema treatment from Intellia have exceeded expectations, according to RBC's Issi. In an advance note, Issi described these results as a "blue sky" outcome, potentially boosting Intellia shares to over $85. However, he also acknowledged that the decline in stock prices on Friday may be due to hedge funds selling their holdings after a previous surge in Intellia's stock. Despite this, Issi remains optimistic about the potential of gene-editing therapies.
In another Phase 1 study, Intellia and Regeneron Pharmaceuticals announced positive long-term outcomes. This collaborative treatment using Crispr technology has demonstrated a more than 90% reduction in a poisonous protein produced by a rogue gene in liver cells. The treatment targets transthyretin amyloidosis (ATTR), which causes damage to the heart and nerves. Some patients have been monitored for up to six months, with sustained results.
Intellia's Crispr treatment for ATTR appears to be on par with Onpattro from Alnylam Pharmaceuticals and Vyndaqel from Pfizer, both of which are chronic drug treatments. Successful trial results for Onpattro earlier this year resulted in a significant increase in Alnylam's stock price.
Regeneron's stock remained stable despite the decline in Intellia's stock value.
During a pre-market call, Intellia officials expressed their excitement about moving forward with Phase 2 controlled trials for the ATTR study. CEO John Leonard hailed these results as validation of their modular approach to Crispr therapies. This approach allows Intellia to target different rogue genes simply by modifying the guide-RNA.
Despite the decline in stock prices, RBC's Issi affirmed his confidence in Intellia, considering it to be the leading gene-editing company in the field.
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