Right now marks an exciting moment for CRISPR Therapeutics (NASDAQ: CRSP) and its investors. The biotech company has reached three milestones in just a couple of months. First, back in November, the U.K. authorized Casgevy for sickle cell disease and beta thalassemia, the world’s first regulatory nod for a CRISPR gene editing-based therapeutic. Then, in two separate decisions, the U.S. Food and Drug Administration also approved the gene editing treatment for the blood disorders. Casgevy is CRISPR Therapeutics’ very first product and has blockbuster potential. So, all of this is major news that should lead to revenue growth. CRISPR Therapeutics and partner Vertex Pharmaceuticals are now rolling out the treatment in the U.S. and the U.K. and waiting for additional regulatory decisions in other countries. So, at this key moment in CRISPR Therapeutics’ story, could you set yourself off on the path to millions if you invest? Let’s find out.
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Revolutionizing Gene Editing
First, a bit of background on CRISPR Therapeutics’ technology. The company is a specialist in the field of gene editing, or the fixing of faulty genes responsible for disease. The CRISPR technique cuts DNA at a specific location and allows a natural repair process to take place. CRISPR stands for “clustered regularly interspaced short palindromic repeats” of genetic information and is based on a technique bacteria use to fight off viruses.
CRISPR Therapeutics’ entire pipeline is based on this technique, so a regulatory nod represents great news for not only Casgevy but also other potential products moving forward. Regulators often are extra cautious about new technologies, so it is a big step forward that they’ve signed off on this one.
What should we expect from Casgevy? First, it’s important to note that sickle cell and beta thalassemia have limited treatment options today, and Casgevy is a one-time curative therapy. These two points could spark demand for this new product.
That said, revenue won’t take off overnight. The Casgevy treatment process takes several months, requiring steps such as collecting blood stem cells and receiving chemotherapy. That means it will take time to sign up patients, escort them through the treatment journey, and generate revenue.
Unlocking Market Potential
But over time, the product could reach blockbuster status. Goldman Sachs analysts predict the treatment may bring in as much as $3.9 billion in peak sales, Bloomberg reported. CRISPR Therapeutics takes 40% of the profit, leaving the rest to Vertex, according to the companies’ partnership agreement. Even this lower percentage represents a big step for CRISPR Therapeutics, though, and could help the company — which already is in a favorable financial situation, with more than $1.7 billion in cash — fund pipeline development.
Regarding pipeline, CRISPR Therapeutics may launch other game-changing products down the road. The company has narrowed its immuno-oncology focus to two next-generation candidates that may be more efficacious and easier to manufacture than earlier candidates. CRISPR Therapeutics is studying them in clinical trials and expects to report an update from those studies this year.
At the same time, CRISPR Therapeutics has expanded into the area of autoimmune diseases and aims to launch a clinical trial in systemic lupus erythematosus in the first half of this year.
Is CRISPR Therapeutics Worth the Investment?
Now, let’s get back to our question. Could investing in this innovative gene editing company help you become a millionaire down the road? The shares are on fire right now, rising 39% over the past three months.
But even if this momentum continues, an investment in CRISPR Therapeutics alone is unlikely to bring you millions of dollars. For example, if you put $10,000 into the stock and the shares climb 50%, your investment would be worth $15,000. That’s great, but it’s far from $1 million.
This doesn’t mean you should turn your back on CRISPR Therapeutics, though. You’re unlikely to reach millionaire status with any single stock — even the most promising. Instead, through investing in many companies and holding on over time, you could reach your goal of becoming a millionaire. And as part of this kind of diversified, well-constructed portfolio, CRISPR Therapeutics, with plenty of potential for gains over the long term, could help you along the path to wealth.
Should you invest $1,000 in CRISPR Therapeutics right now?
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Adria Cimino has positions in Vertex Pharmaceuticals. The Motley Fool has positions in and recommends CRISPR Therapeutics and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
