As the shareholders already know, CRISPR therapies (NASDAQ: CRSP) has quite a few opportunities on the table. Thanks to its commercialized drug, pipeline packed with opportunities to produce blockbuster drugs, and great financial flexibility, there is no shortage of reasons to buy the stock.
But even for those who appreciate the company’s merits, the picture is probably even brighter than they realize. Here are three reasons why the stock is worth buying.
1. Casgevy is about to ramp up its activities
CRISPR’s first commercialized product, a gene therapy called Casgevy, which treats or functionally cures both sickle cell disease (SCD) and beta-thalassemia, is in the midst of a global rollout. Developed in collaboration with Vertex PharmaceuticaCasgevy is now approved for sale in the US, EU and UK, as well as several other countries. There are already 25 Authorized Treatment Centers (ATCs) operating worldwide to administer the therapy, and many more will open over time.
Although the biotech sector reported less than $1 million in revenue in the first quarter of 2024, that will change quickly for the rest of the year and beyond. Patients have already begun the treatment process by having their cells harvested as part of the Casgevy manufacturing process. As more treatment centers open, more patients will be eligible for treatment and sales will start to flow in.
While that is happening, the company will also be working hard to improve key aspects of the manufacturing process as it relates to the conditioning regimen required to prepare patients for harvesting their cells. That is a major concern because at this point it can last many weeks and require a hospital stay of a few days.
If these efforts succeed, and they likely will eventually, it will increase Casgevy’s addressable market size because it will make the therapeutic process less burdensome for patients.
2. Programs in the pipeline with huge target markets
CRISPR’s research and development (R&D) pipeline includes numerous clinical-stage programs for cell and gene therapies that could one day compete in massive markets, with more to come.
For example, the CTX 320 program is aimed at treating atherosclerotic cardiovascular disease (ASCVD) in people with elevated lipoprotein A levels. According to iData Acumen, the market for similar drugs to treat ASCVD will reach $195.8 billion by 2030.
The biotech is also working on another program, CTX 310, which could one day treat or cure a number of different dyslipidemias, including high cholesterol with hereditary origins. The next step after that might be to further refine the program so that it can be used for general cholesterol reduction, which is a common function of many different cardiovascular medications. Not to mention the company’s many oncology programs, some of which could be broadly applicable to the treatment of a wide range of solid tumors.
It may not be able to successfully implement all of its attempts, but right now it has so many different programs that it will probably succeed with at least a few in the long run. In other words, the pipeline offers many reasons to be optimistic about the future.
3. The balance sheet is rock solid
The final reason to buy this stock today is that its balance sheet looks as good as any in the biotech sector. At the end of the first quarter, the company had approximately $2.1 billion in cash, cash equivalents and short-term investments, with no long-term debt, and only $218.9 million in long-term lease obligations.
For reference, operating expenses for the last twelve months were $433.6 million. So CRISPR Therapeutics has plenty of money, and can probably easily borrow large amounts more at a reasonably low interest rate if necessary. It has virtually no financial pressure, which means it has free rein to invest where it sees the best opportunities for growth – and, combined with its other advantages, that’s a reason to buy it.
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Alex Carchidi has no position in any of the stocks mentioned. The Motley Fool holds positions in and recommends CRISPR Therapeutics and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
3 Reasons to Buy CRISPR Therapeutics Stock Like There’s No Tomorrow was originally published by The Motley Fool
