Vertex Pharmaceuticals (NASDAQ: NASDAQ:VRTX) and CRISPR Therapeutics (NASDAQ: CRSP) faced questions from an FDA advisory committee on Monday, October 31, regarding their joint gene therapy, exa-cel, for sickle cell disease (SCD). The committee raised concerns about the precision and reliability of the gene-editing process used in exa-cel's manufacturing.
The therapy, which uses a gene-editing process on hematopoietic stem and progenitor cells (HSPCs), aims to produce functional red blood cells, potentially alleviating or eliminating SCD symptoms. SCD is an inherited disorder that causes red blood cells to harden and warp into a crescent moon shape, drastically affecting their functionality.
Regulators questioned Vertex's use of software simulations over diagnostic experiments to detect unintended edits during the gene-editing process. They suggested additional diagnostic lab work and clinical data analysis may be needed to ensure no off-target editing in all doses of exa-cel. Yet, demonstrating that there are no cells with unintended edits might be technically challenging or even impossible.
Despite these concerns, regulators expressed no doubts about exa-cel's efficacy for SCD or its safety regarding the infusion process or intended impact. The approval of exa-cel seems likely if these minor issues can be addressed.
The final decision on exa-cel's approval by the FDA is scheduled for December 8. This approval would mark CRISPR Therapeutics' market entry and provide Vertex with revenue diversification, as it currently relies solely on cystic fibrosis therapies. The ruling is keenly awaited by shareholders due to its potential impact on both companies' futures.
InvestingPro Insights
InvestingPro's real-time data and expert tips shed light on the financial health and market performance of both Vertex Pharmaceuticals and CRISPR Therapeutics.
For Vertex Pharmaceuticals, InvestingPro data shows a healthy market capitalization of 97.5B USD and a P/E ratio of 28.68 as of Q2 2023. The company's revenue growth is promising, with an increase of 13.83% in the last twelve months as of Q2 2023. The company's return on assets stands at 18.73%, suggesting effective management.
InvestingPro Tips suggest that Vertex holds more cash than debt on its balance sheet and has high earnings quality, with free cash flow exceeding net income. These factors, combined with the company's consistently increasing earnings per share, indicate a strong financial position.
On the other hand, CRISPR Therapeutics, with a market cap of 3900M USD, is less established. The company has been experiencing significant sales growth, as indicated by a revenue growth of 1047.7% in the last twelve months as of Q2 2023. However, the company has not been profitable over the last twelve months, and its P/E ratio stands at -8.83.
InvestingPro Tips for CRISPR highlight that the company holds more cash than debt on its balance sheet and has seen a significant return over the last week. Yet, the company does not pay a dividend to shareholders, which could be a point of consideration for potential investors.
These insights provide a snapshot of the financial health and performance of both companies. For a more comprehensive analysis and additional tips, readers can check out the InvestingPro platform, which offers over 17 tips for each company.
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