October 19, 2016
By Alex Keown, BioSpace.com Breaking News Staff
CAMBRIDGE, Mass. – CRISPR Therapeutics is the third company developing therapies using the CRISP-Cas9 technology to go public this year. The company priced its IPO at $14 per share, slightly lower than what it initially wanted, and raised $56 million—but that lags behind the IPO of two competitors, Intellia Therapeutics and Editas Medicine.
The $56 million the company raised falls short of the $90 million the company initially planned for when it announced its intentions last month. Editas and Intellia went public earlier this year, February and May respectively, and both raised more than $100 million with their IPOs. Both stocks started out hot with share prices rising, but investors have cooled to the company and prices have fallen. Shares of Editas are trading at $13.72 this morning, while Intellia is trading at $12.10 per share.
Four million common shares of CRISPR will be available today under the Nasdaq ticker symbol CRSP. Additionally the company granted underwriters a 30-day option to purchase up to 600,000 additional common shares. The offering is expected to close Oct. 24, the company said. The underwriters for the offering are Citigroup, Piper Jaffray, Barclays and Guggenheim Securities, Seeking Alpha noted.
“CRISPR” refers to Clustered Regularly Interspaced Short Palindromic Repeats that occur in the genome of certain bacteria, from which the system was discovered. Cas9 is a CRISPR-associated endonuclease (an enzyme) known to act as the “molecular scissors” that cut and edit, or correct, disease-associated DNA in a cell. Gene therapy essentially transforms cells inside a patient to harness their immune system to fight an invading disease on its own. CRISPR-Cas9 is considered revolutionary technology, and as such is likely, at some level, to be used by many companies and institutions.
However, there are also some questions about who owns the CRISPR patents. The technology was discovered by UC Berkeley professor Jennifer Doudna and Emmanuelle Charpentier. However, Feng Zhang, a researcher at the MIT-Harvard Broad Institute, filed a broad U.S. patent claim on the technology. Until the question of who owns the patents are settled by a special court at the U.S. Patent and Trademark Office, stock prices could continue to see little traction—especially since none of the now three public companies have yet launched human clinical trials. Editas is likely to move its first drug candidate into clinical trials next year.
Earlier this week analyst Maxx Chatsko, writing for the Motley Fool, said CRISPR stocks are all about potential. He said they do not generate large amounts of revenue, nor are they likely to do so for years. Chatsko said the gene editing companies are being supported by larger pharma firms such as Novartis , Juno Therapeutics , Vertex , Bayer and Regeneron , who have a “keen interest in making the technology work.” For example, in 2015 Juno Therapeutics struck a $727 million deal with Editas Medicine, the gene editing company, for a partnership that will forge three research programs marrying Editas’ technologies, including CRISPR-Cas9, to Juno’s CAR-T and TCR technologies. Last year CRISPR Therapeutics and Bayer forged Casebia Therapeutics to develop and commercialize new drugs for blood disorders, blindness, and congenital heart disease using CRISPR’s gene-editing technology.
One CRISPR company that remains private is Caribou Biosciences, which was founded by Doudna. Intellia sprang out of Caribou. Earlier this summer Caribou netted $30 million in Series B financing to expand its CRISPR gene editing technology platform and accelerate the company’s efforts in “highly promising application areas in agriculture, therapeutics, biological research, and industrial biotechnology.”
