Analysts recommend these gene-editing stocks.
Gene therapy and gene editing are on the cutting edge of modern biotechnology. Gene therapies are used to correct genetic abnormalities by introducing genetic material at a cellular level, and can often take the form of adding a functioning copy of a gene. Gene editing takes the science to the next level, seeking to directly alter the genome itself as a therapeutic approach. Most gene-editing stocks have taken a big hit in recent months, but analysts at ResearchAndMarkets.com still expect the genome-editing market to grow 53.1% annually and reach $59.4 billion by 2027. Here are seven of the best gene-editing stocks to buy, according to Bank of America.
CRISPR Therapeutics AG (ticker: CRSP)
CRISPR Therapeutics is a biotech company that uses gene-editing tool CRISPR-Cas9 for hemoglobinopathy — or blood disorders — and oncology — or cancer — applications. CRISPR has three 100%-owned gene-editing therapies in clinical trials and is co-developing two other therapies with partners Vertex Pharmaceuticals and ViaCyte. CRSP shares are down about 56% in the past year through June 13. However, analyst Geoff Meacham has high hopes for CTX001, CRISPR’s gene-edited stem cell therapy treating beta thalassemia and sickle cell disease, or SCD. Meacham anticipates regulatory submissions for CTX001 by the end of 2022. Bank of America has a “buy” rating and $125 price target for CRSP stock, which closed at $55.27 on June 13.
Beam Therapeutics Inc. (BEAM)
Beam Therapeutics uses CRISPR technology to change single bases in the genome with a technique called base editing, which only breaks one strand of the DNA and may have higher cell survival rates. The company focuses on hemoglobinopathy and oncology indications, but is also researching treatment for ocular and liver disease. In the second half of 2022, analyst Greg Harrison says Beam is on track to begin its first clinical trial of BEACON-101 in treating SCD, as well as to submit investigational new drug applications (INDs) for BEAM-102 and BEAM-201 and to initiate other IND-enabling studies. Bank of America has a “buy” rating and $125 price target for BEAM stock, which closed at $29.86 on June 13.
Apellis Pharmaceuticals Inc. (APLS)
Apellis Pharmaceuticals is a biotech company focused on therapies targeting the complement pathway of the immune system, which enhances the immune system’s ability to clear damaged cells. The company’s main product is pegcetacoplan, which is already approved in the U.S. for treating paroxysmal nocturnal hemoglobinuria, a rare acquired blood disease, and is in late-stage development for treating geographic atrophy, a cause of vision loss in old age. Last year, Apellis announced a new collaboration with Beam Therapeutics to leverage base-editing technology to research new precision therapies for the eye, liver and brain. Analyst Tazeen Ahmad says pegcetacoplan is a valuable, differentiated asset. Bank of America has a “buy” rating and $69 price target for APLS stock, which closed at $39.36 on June 13.
Graphite Bio Inc. (GRPH)
Graphite Bio is a gene-editing technology company that leverages both CRISPR and natural DNA repair processes. Meacham says Graphite’s pipeline is the primary driver of upside for the stock. Graphite is on track to begin dosing SCD patients with GPH101 as part of its Phase 1/2 CEDAR trial starting in the second half of 2022. Graphite expects data on that trial in 2023. Meacham says he doesn’t foresee any major regulatory headwinds for GPH101, especially after it was granted Fast Track Designation by the U.S. Food and Drug Administration. Bank of America has a “buy” rating and $12 price target for GRPH stock, which closed at $2.30 on June 13.
Caribou Biosciences Inc. (CRBU)
Caribou Biosciences is a clinical-stage biotech company developing gene-edited allogeneic, or universal, cell therapies to treat cancer. The stock dropped 20% on June 10 and another 26.5% on June 13 after the company reported additional data on its Antler phase 1 trial testing CB-010 in patients with relapsed or refractory B cell non-Hodgkin lymphoma. Caribou reported a 100% complete response rate in all six patients at the initial dose level, but Meacham says the stock dropped because that complete response rate fell to just 40% at six months. Nevertheless, he remains optimistic about CB-010 and says weakness in the stock is a buying opportunity. Bank of America has a “buy” rating and $28 price target for CRBU stock, which closed at $5.10 on June 13.
Allogene Therapeutics Inc. (ALLO)
Allogene Therapeutics is a biotech company developing allogeneic chimeric antigen receptor T-cell, or CAR-T, therapies to treat cancer. Allogene’s ALLO-501 and ALLO-715 therapies both utilize a proprietary gene-editing technology and are in phase 1 testing. In October 2021, the FDA announced a clinical hold on both of Allogene’s clinical-stage allogeneic CAR-T programs due to a single chromosomal abnormality in one trial patient, but that hold was lifted in January 2022. Analyst Jason Gerberry says Allogene’s bullish catalysts include pivotal trial initiation of ALLO-501A and clinical updates on ALLO-715 and TurboCAR in the second half of 2022. Bank of America has a “buy” rating and $28 price target for ALLO stock, which closed at $8.85 on June 13.
Vertex Pharmaceuticals Inc. (VRTX)
Vertex Pharmaceuticals develops small molecule therapeutics for treating cystic fibrosis and anti-inflammatory conditions. In 2021, Vertex acquired the rights to 60% of the profits from sales of CRISPR Therapeutics’ gene-editing therapy CTX001 for up to $1.1 billion, pending regulatory approval. In August 2021, Vertex announced a new $1.2 billion deal with Arbor Biotechnologies to use Arbor’s gene-editing technology in developing therapies. Two months later, Vertex announced yet another deal with Mammoth Biosciences worth up to $691 million to utilize Mammoth’s proprietary ultra-small CRISPR systems to develop gene-editing therapies. Meacham says Vertex’s core business generates strong, stable cash flows, and gene editing is one of many potential growth catalysts in Vertex’s future. Bank of America has a “buy” rating and $310 price target for VRTX stock, which closed at $245.39 on June 13.
7 top gene-editing stocks to buy:
— CRISPR Therapeutics AG (CRSP)
— Beam Therapeutics Inc. (BEAM)
— Apellis Pharmaceuticals Inc. (APLS)
— Graphite Bio Inc. (GRPH)
— Caribou Biosciences Inc. (CRBU)
— Allogene Therapeutics Inc. (ALLO)
— Vertex Pharmaceuticals Inc. (VRTX)
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Update 06/14/22: This story was published at an earlier date and has been updated with new information.