The story of a pioneer of gene editing CRISPR – The Motley Fool

Gene publishing holds the promise of revolutionizing health care. But there is only a handful of stocks available to invest in technology. One of the leaders is Intellia Therapeutics, Inc. (NASDAQ: NTLA) .

* As of July 16, 2018. Data Sources: Yahoo! Finance, YCharts.

How did Intellia Therapeutics become one of the pioneers of the most successful gene editing? Here is the story behind biotechnology and its stock.

What is Intellia Therapeutics doing?

Intellia Therapeutics is a biotech that focuses on the development of therapies using the CRISPR-Cas9 gene editing. The company's leading drug candidates are targeting remedies for genetic diseases such as transthyretin amyloidosis (ATTR) and sickle cell disease. Intellia also has several other programs in preclinical development

What is CRISPR-Cas9?

CRISPR-Cas9 is considered by many to be the best approach for gene editing developed to date. CRISPR is an abbreviation for Short Palindromic Repeats, Clustered Regularly Interspaced. This refers to sections of DNA that can be read in the same way both forward and backward and separated by segments of "spacer DNA" that do not contain instructions for the construction of proteins. Cas9 is the abbreviation for CRISPR-badociated protein 9.

Scientists discovered several years ago that certain types of bacteria used CRISPR-Cas9 to slice DNA from attacking viruses. Over time, the researchers discovered how CRISPR-Cas9 works, and they learned how to guide CRISPR-Cas9 to a targeted DNA sequence to modify genes

from other methods of life. Gene editing already existed, including zinc-finger nuclease (ZFN) technology and transcriptional activator-type nuclease (TALEN). However, CRISPR-Cas9 was significantly less expensive and much easier to use than these earlier approaches.

The Beginnings of Intellia Therapeutics

Intellia Therapeutics was founded in May 2014. The name of the company is based on the Greek word entelia, which the company says means "a situation of excellence, without fault, and having all the elements, qualities or characteristics required. "

Biotech was formed by venture capital firm Atlas Venture and Caribou Biosciences. Atlas Venture has a long history of investing in life sciences companies in the start-up phase, some of which have become big winners such as Alnylam Pharmaceuticals and Exelixis . Nessan Bermingham, partner of Atlas Venture, became the first CEO of Intellia Therapeutics

Caribou Biosciences is a private biotechnology company specializing in the use of CRISPR-Cas9. The company was co-founded by Jennifer Doudna, one of the pioneering CRISPR-Cas9 researchers. One of the first actions of Intellia was to license Caribou for gene editing technology and to enter into contracts with the company for research and development services.

In November 2014, Intellia completed a $ 15 million round. Atlas Venture and Novartis contributed the most to this financing. Both companies each hold at least 8% of Intellia, Caribou Biosciences holding nearly 13% of biotech.

Novartis did not just buy a stake in Intellia. In January 2015, the large pharmaceutical group and small biotech announced a five-year research and development collaboration focused on the use of CRISPR-Cas9 in the development of T-cell (T-CARD) and cell therapies. chimeric hematopoietic strains (HSC). 19659014] The expertise of Intellia in the gene editing attracted the attention of another large company the following year. In April 2016, Regeneron Pharmaceuticals signed a six-year contract with Intellia to develop CRISPR-Cas9 therapies. Intellia received $ 75 million from the start as part of the deal. In exchange, Regeneron has obtained exclusive rights for products targeting up to 10 indications, based on Intellia's CRISPR-Cas9 research.

The Initial Public Offering of Intellia

In February 2016, Editas Medicine became the first CRISPR-based biotech to make an IPO. Intellia Therapeutics did not wait too long to join the fray

Biotech announced the price of its IPO on May 5, 2016. Intellia was planning to sell 6 million shares at a price of 18 dollars per action. Subscribers of the stock offer also got an option to purchase 900,000 additional shares at the IPO price

Intellia reported on May 11, 2016 that the # 39; IPO had been concluded with 6.9 million shares sold. The net proceeds of biotechnology after all commissions, underwriting discounts and expenses amounted to about $ 112.9 million

Inventory History of Intellia Therapeutics

Possessing Great Potential for the CRISPR-Cas9 gene edition, you could expect. That was – but only briefly.

NTLA Data by YCharts

The course of Intellia's action has exploded in the days following its IPO. However, the stock quickly fell well below its IPO price. There were at least two reasons behind the decline of Intellia

. One was simple: Intellia was skyrocketing up to a market cap of nearly $ 1 billion with no earnings and prospects of having at best approved production years. In the words of former Federal Reserve Chairman Alan Greenspan, there was probably an "irrational exuberance" among investors compared to the Intellia Therapeutics action

Another factor major was considerable uncertainty about Intellia's intellectual property rights. As previously mentioned, Intellia has obtained a license for its CRISPR-Cas9 technology from Caribou Biosciences. The patents concerned belong to a group of patents originally filed by the University of California Berkley (UCB), the University of Vienna and Dr. Emmanuelle Charpentier, who was one of the of the first CRISPR-Cas9 researchers and co-founder of another However, other parties also granted sublicenses to the intellectual property of UCB, the University of Viena and of Charpentier. These parties included CRISPR Therapeutics and ERS Genomics, which were formed to provide access to Charpentier's intellectual property.

To further complicate matters, the Broad Institute, Harvard University and the Mbadachusetts Institute of Technology (MIT) obtained patents for use of CRISPR-Cas9 in eukaryotic cells – cells with a nuclease, including including all human and animal cells. The UBC party and parties aligned with the Broad Institute were entangled in patent litigation that concerned investors who owned or were considering buying any CRISPR-based biotech stocks, including Intellia.

In December 2016, Intellia Therapeutics, Caribou Biosciences, CRISPR Therapeutics, and ERS Genomics announced "a global agreement for cross-consent and invention management" that allowed all organizations to share the intellectual property held by UCB, the University of Vienna and Charpentier. This agreement has simplified some aspects of patent uncertainty

But the situation has deteriorated for Intellia and its allies in February 2017. The USPTO has ruled that the Broad Institute patents for Use of CRISPR-Cas9 in eukaryotes cells did not interfere with patents on the UCB side. Although the UBC team appealed the decision in federal court, the decision definitely undermined the actions of Intellia and other biotechs aligned with UCB.

Finally, the attention of investors returned to the potential of CRISPR-Cas9. All CRISPR-focused biotech stocks performed well in the second half of 2017. However, Intellia's momentum ceased when the company announced a new share offering on November 1, 2017, diluting investors.

In 2018, the stock of Intellia is well behaved. The company has reported progress on several fronts, including the success of genetic modification in mice that contributes to liver problems badociated with some alpha-1 antitrypsin deficient patients and the initiation of final tests in non-human primates targeting l & # 39; ATTR.

CRISPR-Cas9 Controversies

Questions were also raised along the way on the safety and effectiveness of CRISPR-Cas9. For example, in May 2017, Nature Methods published a study that found that CRISPR-Cas9 could lead to many unintended genetic mutations. This was quite disturbing since one of the benefits of editing the CRISPR-Cas9 gene is its accuracy.

Finally, this particular question was put to rest. In March 2018, the authors of the study published a retraction and an error correction. Their initial findings were untrue: CRISPR-Cas9 did not cause hundreds of out-of-target mutations

Meanwhile, however, another potential problem with CRISPR-Cas9 surfaced. In January 2018, the researchers published an article on a web site focused on pre-printed scientific research that was not peer reviewed. This article suggests that human immune responses may interfere with CRISPR-Cas9.

Scientists have discovered that many humans have immune responses to the types of bacteria in which CRISPR-Cas9 self-defense mechanisms have been found. Although they have not shown that immune responses would certainly cause problems with the CRISPR-Cas9 function in humans, their research has raised concerns about this possibility

This news drove down stocks of Intellia, CRISPR Therapeutics and Editas Medicine. The decline was short-lived, however. Each stock bounced back quickly as investors learned that there could be workarounds to the problem of the immune response – if that actually happened to be a problem.

This was not the end of fears for CRISPR-Cas9. In June 2018, two separate articles published in Nature Medicine highlighted the possibility that the use of CRISPR-Cas9 could cause cancer. The gene editing method works more efficiently in cells with mutations in the p53 gene. However, p53 mutations are linked to an increased risk of several types of cancer.

These are not all bad news. At this point, the higher cancer risk seems to be only a problem when CRISPR-Cas9 is used to "knock out" or delete a DNA sequence and replace it with a corrected sequence. The principal candidate of Intellia targeting ATTR uses only the type of gene knockout edition. However, some preclinical biotechnology programs suppress and replace DNA sequences. There could be challenges for Intellia in the long term related to the increased risk of cancer.

More recently, another scientific paper published in Nature Biotechnology on July 16, 2018, has again raised concerns about the potential of CRISPR-Cas9 to induce unexpected genetic mutations. Early results suggest that involuntary DNA sequence changes could occur far from the target site

What are the Next Steps for Intellia Therapeutics

Intellia Therapeutics and Regeneron Hope to Submit a Case to the Food and Drug Administration (FDA) By the end of 2019, begin Phase 1 clinical trials of the CRISPR-Cas9 gene editing therapy targeting AATR. The transition to clinical trials in humans is an important step for Intellia

. However, the company has other pipeline programs that it hopes to advance. Here is a summary of the candidates for the Intellia Pipeline:

Source: Intellia Therapeutics.

The main thing that investors should take out of Intellia's pipeline is that biotechnology is still very much in preliminary stages. Preclinical discovery is the first step in the drug development process. Preclinical development, which may include tests in test tubes or in animals, comes next. Intellia's references to "end-stage preclinical development" simply mean that preclinical testing is sufficiently advanced that the company hopes to progress to clinical trials in humans in the not-too-distant future.

Can Intellia Therapeutics be purchased?

The promise for CRISPR-Cas9 is certainly exciting. The main Intellia program targets an ATTR disease that affects 50,000 patients worldwide. Currently, treatment options are limited and the disease is usually fatal within 15 years of the onset of symptoms. The potential to cure ATTR is very attractive – and would undoubtedly make billions of dollars from Intellia if it succeeds.

But if Intellia will be successful or not is unknown. Some of the CRISPR-Cas9 risks were discussed. Other problems may still occur. And in addition to these potential problems, the intellectual property rights issues for CRISPR-Cas9 remain unresolved.

To add further to the arguments against Intellia, biotechnology is well behind CRISPR Therapeutics and Editas Medicine in development. These two competing CRISPR-based biotechs hope to begin Phase 1 clinical trials for their leading candidates later this year.

Biotechs with clinical stage drugs are only suitable for aggressive investors. But biotechnology stocks like Intellia Therapeutics, which does not even have a candidate in clinical trials, should only be considered by the most aggressive investors. Although I am cautiously optimistic about the prospects for CRISPR-Cas9 and, by extension, for Intellia Therapeutics, I do not think the title is a title to buy at the moment.