CRISPR Stocks in Wake of Verve Therapeutics Acquisition by Eli Lilly

 

Last night, news broke that pharma giant Eli Lilly was in talks to acquire Verve Therapeutics.  After a 3-year lull in major CRISPR dealmaking following the Covid bubble, this brings the space the Big Pharma validation that genome editing is not a crazy fantasy, but a core modality of future drug innovation. To my surprise, even hardcore biotech investors had been waiting for such validation before considering the space investable. 

Needless to say, the news will trigger pin action in other CRISPR stocks.  In this blog post, also based on a similar experience I had in the RNAi space about 10 years ago, I will lay out how I see it play out,  

Verve acquisition is a steal

As you will remember, Verve is developing an exciting one-time PCSK9 base editing treatment, VERVE-102, that could transform LDL-cholesterol-driven atherosclerotic cardiovascular disease (ASCVD).  According to the rumors in the Financial Times the proposed acquisition price is ~$1.3B.  This would be a bargain considering the potential of VERVE-102. 

Even with the current small available safety dataset, it is hard for me not to see VERVE-102 as a highly compelling option for the 1-2 million heterozygous familial hypercholesterolemia (heFH) population in the US and Europe alone.  Slap on that a $100,000 treatment price, this alone has Glp1-type market dimensions.

Under normal market conditions, such a steal would not be possible.  But these have been anything but normal biotech investment times. I believe that more than the nice short-term financial reward of an acquisition, Verve management is doing here what is best for VERVE-102 reaching its maximal potential.  Ultimately, it takes the financial resources, experience, and credibility of a pharma giant to develop and commercialize such a revolutionary treatment to such a big market.  

Who is next?

But luckily for investors, Verve Therapeutics has not been the only severely undervalued CRISPR company.  When Alnylam started to gain tremendous traction in 2012-3 after demonstrating that you can make RNAi gene silencing work in humans, still working as a consultant to companies and investors back then, I noticed how funds started to dig into who could be the next Alnylam to invest in.

So on the back of very strong recent clinical data in the space (VERVE-102, NTLA-2001/2, BEAM-302) and now the Big Pharma validation, I expect the same dynamic to unfold here.

Intellia Therapeutics

The first obvious company to benefit from fund inflow should be Intellia Therapeutics.  Verve Therapeutics will be acquired mostly for a therapeutic candidate that has shown promise in the clinic. Intellia therefore with not just one, but three clinically validated market opportunities (ATTR-CM, ATTR-PN, HAE) and a reasonably large market cap of around $900M and good trading liquidity for funds to take needle-moving positions in, will come first on the radar.

What is more, almost the entire market cap can be accounted for by its cash position and the stock has come down from a high of around $200 4 years ago to $9.  The main reservation by the investor community has been that patients will prefer a daily pill over a futuristic-sounding lifetime treatment, if not cure.  I guess they were wrong.  Not only is Eli Lilly’s proposed acquisition a vote of confidence in CRISPR modality, but the KOLs in the ATTR and HAE field are already fully on board.

Beam Therapeutics

Beam with a market cap about 2x of Intellia’s will also come into investor focus.  While I do have a small position in that company, it is by far not as big as the one I have in Intellia.

This is because I consider uncertainties around its two lead candidates, for sickle cell disease (SCD) and alpha-1-antitrypsin disease (AATD), to be higher than for Intellia’s opportunities.  Their sickle cell disease base editing should be superior to that of already approved Casgevy by Crispr Therapeutics and Vertex Pharmaceuticals. 

But will that be enough for the ex vivo autologous hematopoietic stem cell approach to gain quicker commercial traction than Casgevy?  With regard to BEAM-302 for AATD, I am still waiting for more clarity on the liver safety of their (non-GalNAc) LNP.  It was the new safety standard set by VERVE-102 (GalNAc-targeted and ‘Novartis ionizable lipid’) that makes VERVE-102 a viable therapeutic in the first place.

Prime Medicine

Having just cured p47phox variant chronic granulomatousdisease (CGD) which could entail a valuable priority review voucher, Prime Medicine is now focusing on the relatively large severe genetic liver disease opportunities of Wilson’s Disease and AATD.

While not as clinically advanced as Beam Therapeutics, Prime Medicine has the benefit of learning from the LNP safety of the Intellia, Beam, and Verve programs.  I therefore expect them to bring forward a lower-risk GalNAc-enabled LNP similar to Verve’s when it enters the clinic next year.

From a platform point of view, prime editing is the future of CRISPR medicine due to its versatility and exquisite on-target specificity.  Prime Medicine with a dominant IP position in prime editing, a market cap of $200M, much of which in cash, is therefore a prime candidate for a Big Biotech/Pharma looking to make use of that technology for its in-house targets.

Metagenomi

Going nowhere in its clinical pipeline, but generating new, especially smaller CRISPR editors that could have delivery and immunologic advantages, is Metagenomi.  Its lead candidate is a CRISPR-enabled gene drop-in approach for hemophilia A (MGX-001) which it hopes to bring into the clinic in 2026.

While I consider Metagenomi’s gene drop-in data to be industry-leading, there are questions around its safety profile since it will involve not only LNP, but also AAV for systemic delivery.  So while MGX-001 could be the first ‘gene therapy’ for hemophilia with sustained transgene expression, Metagenomi’s valuation will unlikely get recognition for it until actual clinical data.

The main reason why Metagenomi is interesting here is that it is not only trading 70% below cash ($55M market cap, $200M cash), but that it has an important partnership with Ionis Pharmaceuticals which could view CRISPR as an increasingly important mechanism to shore up its commercial ambitions in ASO-led franchises such as ATTR, HAE, and cardiovascular disease.

If I were Ionis Pharmaceuticals, I would just buy Metagenomi for $200M, retire preclinical MGX-001 for little cost and thus get rid of my future milestone and royalty obligations.  Of course, Ionis may prefer Prime Medicine for its more versatile technology.

Buying a platform-only company in this biotech tape is certainly not for the faint of heart and large funds will shy away from Metagenomic at least initially due to its small size and illiquidity.  I can see it, however, emerge as an attractive second-wave opportunity should interest in CRISPR stocks be sustained enough.  As a backstop, you still have Ionis Pharmaceuticals having to make a decision on investing further into Metagenomi later this year.

You may ask yourself why I have not mentioned the biggest CRISPR company by market cap, $3.6B CRISPR Therapeutics.  This is because of initially overoptimistic expectation for Casgevy sales and with their recent RNAi deal spreading themselves out too thinly and losing their cutting edge so early in the game.  I would also like to see them disclose the liver safety before attributing value to their first generation Cas9 nuclease-based cardiovascular CRISPR franchise.

 

Disclosure: Verve Therapeutics became my largest portfolio position after they disclosed VERVE-102 data two months ago.  While smaller than my positions in Huntington’s disease gene therapy company uniQure and RNA editing company ProQR, Prime Medicine and Intellia Therapeutics are not far behind and very meaningful positions with close to 10% portfolio weightings.

This is not financial advice.  It is intended for those interested in contemplating the stock market repercussions of the rumored Verve Therapeutics acquisition.  Buying a stock is the simple part, successfully trading it for profit much more difficult. 

2nd Patient with Chronic Granulomatous Disease Successfully Treated with Prime Editing

Prime editing researchers are so excited about the technology that sponsor Prime Medicine is unable to control the newsflow on their CGD trial.  As happened 3 weeks ago at the ASGCT where news of a first patient successfully treated with PM359 leaked, Prime Medicine co-founder Dr. David Liu just dropped (23:00min mark) that a second subject has been treated…with even greater efficacy.

 

90% gene correction efficacy

As was detailed in a subsequent press release by Prime Medicine, the first patient saw a 66% correction of the GT deletion in the mutated NCF1 gene in hematopoietic stem cells that had been treated with prime editing ex vivo.  Importantly, neutrophil (day 14) and platelet (day 19) engraftment occurred extremely fast following transplantation compared to prior experiences with Cas9 nuclease (e.g. Casgevy, ~30 days) and similar to base editing (Beam Therapeutics sickle cell program).  This indicates that non-double-strand DNA cleavage methods are preferable for ex vivo HSC editing from that perspective alone.

Following a company re-organization where Prime Medicine announced it would not further pursue PM359 in favor of commercially more attractive genetic disease in the liver, the future of that program seemed in limbo.  However, with a second patient now treated, and at remarkable 90% gene correction efficacy according to David Liu, it now looks like Prime Medicine will complete the first patient cohort and seek ways to monetize the priority review voucher potential (PRV) of that program.  PRVs have recently sold for ~$150M a piece and provide a critical incentive for the development of treatments for rare pediatric diseases.

The PRV incentive was highlighted by David Liu, the intention to complete the first cohort confirmed in a fireside chat yesterday at Jefferies by the new CEO Allan Reine.  Considering the rarity of this form of CGD (~1 in 600,000 births), I would not be surprised if the new FDA granted PM359 early approval after this cohort considering that HSC gene editing is now well established.

 

Update on arbitration with Beam Therapeutics

Clinical results with CGD and preclinical data from Prime Medicine’s in vivo liver programs show that, with optimization and know-how, prime editing efficacies can be as high as with the simpler, but somewhat dirtier Cas9 nuclease and base editing.  This makes them the preferred CRISPR editing modality for virtually all indications and has led to a conflict with Beam Therapeutics as they see their lead alpha-1-antitrypsin (AATD) base editing program under threat.

Previously, I had viewed Beam Therapeutics to have the upper-hand with regard to correcting the Z allele as this, as a single transition application, would seem to fall within its exclusive field of use of prime editing under their agreement with Prime Medicine.  Allan Reine, however, hinted at Jefferies that the edit Prime Medicine is pursuing is aimed at restoring the wildtype amino acid…not necessarily wildtype DNA.  This could mean that Prime Medicine’s strategy is to replace the AAG lysine codon in the 342 Z allele to GAA glutamic acid, instead of GAG as Beam Therapeutics is doing.  This would involve two, not a single transition and thus arguably fall outside the scope of Beam’s exclusive field 😊.

Disclosure: I am long Prime Medicine with about 7% of my portfolio allocated.  Given yesterday’s bullish regulatory (FDA CBER listening session), legal, and clinical developments and the basic premise that prime editing is the preferred CRISPR modalities in the foreseeable future, I am looking to add to my position.  Hard to believe a company controlling such a monumental technology can go bankrupt as the markets seem to price in.

Beam Therapeutics and Prime Medicine Need to Unite

Prime Medicine disclosed this week that they were in binding arbitration with Beam Therapeutics regarding their development of prime editing for alpha-1-antitrypsin disease (ATTD).  This is one of the fall-outs from the VC-driven glut of CRISPR-related start-ups during its hype phase.  It is an opportunity to correct one mistake by uniting the two technologies under one roof for the benefit of patients and investors.

Beam gained exclusive rights for transition mutations

When Prime Medicine was set up in 2019, Beam Therapeutics (founded in 2017) gained exclusive rights to the use of prime editing for transition mutations, i.e. converting A>G, G>A, C>T, and T>C.  This way, Beam Therapeutics’ foundational base editing capabilities would be shielded from competition by a company having the same scientific founder, Dr David Liu.

2019 collaboration and license agreement

While in theory, Beam's rights appear straightforward, in practice things often become murky, especially when interests diverge.  Typical collaboration and license agreements, and this one in particular, rely on the sharing of know-how to actually enable therapeutic development.  If the parties are at war, however, this clearly is unrealistic.  

Prime editing was in its infancy in 2019 when the agreement was signed. Since then, numerous improvements to prime editing have emerged to increase the miniscule efficiency of the original invention.  Any researcher contemplating using prime editing knows what I’m talking about as he will get dizzy from the dozens of possible iterations to choose from.  Moreover, to get to the >50% in vivo prime editing efficiencies Prime Medicine is now reporting, the company will have gathered critical trade secrets.

The question that then often arises is whether related IP and know-how is within the scope of the agreement.  We also have yet to learn how long the term of the collaboration agreement was.  In any case, I expect sufficient wiggle room for Prime Editing to get something out of a hostile arbitration.

Base editing as a transition mutation in the evolution of CRISPR technology

Base editing was a tremendous invention and associated with high editing efficiencies from the get-go.  However, this high editing efficiency also comes at the cost of the bystander editing issue, meaning that bases nearby target As and Cs in the protospacer loop region also get easily edited.  This sometimes is relevant for both safety and efficacy of the editing approach.  Moreover, as the base editing enzyme hangs out in the nucleus, it similarly indiscriminately deaminates single-stranded RNAs it encounters.  This is a particular issue when the enzyme is not delivered as an RNP or mRNA and will be present in a cell for longer.  Finally, despite not introducing double-strand breaks like Cas9 nuclease, it sometimes leaves behind small indels, and in the case of cytidine deaminases surprisingly many translocations.

So as the efficiency of prime editing, which has incredible specificity, is catching up with base editing, it more and more becomes a threat to the bread-and-butter applications of base editing, including AATD.  And in theory, if Beam Therapeutics were to push alpha-1 editing upwards of 60% in competing with prime editing, the efficiency of ‘clean edits’, that is edits without concurrent bystander edits actually decreases.

And what if you had to go back in and correct the edit if you find out 10 years down the line that an edit was problematic?  With the precision of prime editing, the target site will be there as predicted and therefore targetable.  That is not the case when you have to deal with target sites containing just the on-target edit, a mix of on- and bystander edits, or just bystander edits.

A similar situation presents for sickle cell disease, although in this case Beam Therapeutics got rights to the causative sickling transversion mutation in the beta-globin gene, not 'just' reactivating fetal gamma-globin via base editing.  Base editing, it increasingly appears, is at the risk of becoming a transitory technology. 

Get David Liu in the room!

Clearly, the prime editing competition is on its heels of Beam's two lead programs (AATD and SCD) and eventually will be the preferred options for patients. 

This is where I believe the scientific founder David Liu could and should step in.  How can he watch Beam Therapeutics shelve prime editing and access to better medicines for patients just so that Beam can protect its own franchises?  Also, if not Prime Medicine, other companies working on ‘gene writers’ will eventually get there, too, so none of his companies would benefit from the opportunity prime editing presents.  With prime editing enabled in-house, Beam could further cement disease franchises in the form of follow-on products.  

Last, but certainly not least, the development of prime editing for addressing genetic disease caused by many mutations within a given gene, an application that only prime editing is fit to pursue is stalled when Prime Medicine, or their licensing partners, are prohibited from addressing basically 50% of the point mutations?  How can David Liu accept this?

So get in the room, David Liu, and talk sense into the executives.  You have the moral power to do this and investors from both companies stand to benefit from seeing the two companies united.

First Curative Correction of a Deletion Mutation by Prime Editing

Another week, another disease cured by CRISPR technology.  

Today, Prime Medicine revealed that a young man with autosomal recessive chronic granulomatous disease (CGD) successfully received his own hematopoietic stem cells after ex vivo correction of a 2 nucleotide deletion in the NCF1 gene.  This is the first time a deletion mutation has been corrected and was achieved by prime editing, the most versatile of CRISPR technologies.  Cells, in particular the critical neutrophils engrafted in record time, supporting the ‘gentle’ nature of prime editing which does not involve double-strand breaks.  This can be problematic in the hematopoietic stem cell setting (p53 response).

CGD is an ultra-rare (~6000 patients in the US and EU) severe immunodeficiency caused by insufficient NADPH oxidase activity in phagocytic cells.  This activity is needed to kill off pathogens via reactive oxygen species (ROS).  The disease carries a high morbidity from recurrent and chronic infections with life expectancies in developed countries typically ranging from 30-60 years.  20% restoration of NADPH activity is thought to be curative.  Prime Medicine exceeded that easily with activity rising to 66% by day 28 following transplant.

  

NCF1 accounts for ~20% of CGD, most of which due to the deltaGT mutation.  This translates into a market opportunity of ~2000 patients in developed countries.  Considering that PM359 represents a most compelling treatment option despite of pre-conditioning concerns, de-prioritizing a  ca. $10B TAM is not an obvious decision as this trial could rapidly be expanded into pivotal trial phase.

I suspect Prime Medicine did not want to invest in the infrastructure involved in commercializing such an ex vivo cell therapy.  Instead, it is seeking a partner for the asset and is now concentrating its resources on in vivo LNP-delivered prime editing treatments for Wilson’s and alpha-1-antitrypsin diseases.  Vertex Pharmaceuticals, the commercial entity behind sickle cell CRISPR medicine Casgevy, would be a possible option and the prospect of PM359 receiving a priority review voucher (which recently have been selling for ~$150M a piece) should be a nice incentive.

Unfortunately, as part of the re-organization of the company, Prime Medicine is also dropping the program for X-linked CGD which is 3-4x more common than NCF1 CGD, but is caused by a plethora of mutations throughout the CYBB gene.  The company had pursued a gene drop-in approach with which it had hoped to address the entire CYBB market.  Considering the progress in ‘N=1’ drug development, X-linked CGD could have been a great showcase of conducting a basket-trial (possibly including them in the NCF1 pivotal trial phase) involving various mutation-specific prime editors.  Because whether CGD is caused by a mutation in the NCF1 or CYBB gene, the end goal would be the same: restoration of NADPH1 oxidase activity (as measured by DHR).

Landmark ATTR-Polyneuropathy Data by Intellia Caps Off Momentous Week in CRISPR Therapeutics

This has been a most remarkable week in CRISPR Therapeutics as momentum continues to build. 

Bespoke therapeutic in 6 months

First, the drug development world and beyond was captivated by the story of how a baby born with life-threatening point mutations in the CPS1 gene was able to receive a bespoke base editing therapy in just 6 months by harnessing the platform potential of nucleic acid-targeted therapeutics and regulators getting out of the way (Musunuru et al 2025). 

Every pharma CEO will be asking her business development underlings about recent underinvestment in the technology when the report shows how development timelines and expenses can be slashed by a factor of 10 when everybody applies ‘common sense’.

I purposely make use of new US administration lingo, because while the CPS1 deficiency story happened under the watch of Peter Marks who was fired as CBER chief because of his involvement in Covid19 mRNA vaccines, there is every reason to believe that drug development will continue to be streamlined by cutting out time-consuming bureaucratic hurdles and applying AI-based document reviews.  Accordingly, Trump's HHS and FDA has repeatedly called for accelerated drug development based on common sense, including biological plausibility.  As further evidence of that, it is phasing out certain lengthy animal toxicology studies.

The most immediate beneficiaries of the story are nucleic acid-targeted therapeutics addressing severe, underserved diseases by harnessing proven delivery and which have a clean off-target profile.  Besides CRISPR-based therapeutics, this also includes oligo-mediated RNA editing which has exquisite on-target specificity and where Rett Syndrome could serve as a template when addressing disease populations segmented by numerous mutations.   

 

First patient treated with prime editing medicine

Though behind a paywall, STAT reported last week that the first patient had been treated with a CRISPR prime editing agent.  The timing is fitting, as prime editing, by virtue of it being able to address any small mutation, including non-transition mutations and small deletions, is the most universal iteration of CRISPR.  It is also the safest of them all with Prime Medicine claiming no detectable off-targeting for any of its development candidates.

The CPS1 urea cycle story could have been even better if they had used the safer and more effective delivery of VERVE-102 instead of VERVE-101 used by former Verve employee and co-founder Kiran Musunuru.  Also, the base editor in question had not been tested before in the clinic and was selected by comparing a number of adenine base editors in cell lines which also differed in terms of PAM sites and bystander editing.  A prime editing approach by contrast is not subject to PAM constraints as the edit can happen well within a 50 nucleotide window of a given PAM without losing much efficacy.  There is also no bystander editing to worry about.  This way, the same (proven) prime editor mRNA could be used in the same LNP formulation.

The key to quickly applying prime editing in such circumstances would be (AI/machine) learning from the growing dataset of prime editing experiments to find guide RNAs of high efficacy.

Prime Medicine has made great strides towards getting editing efficiencies up to standard Cas9 and base editing levels.  With the first patient dosed, we can expect data in support of that well before the end of the year (2 months for engraftment in the CGD setting).

 

CRISPR Therapy sets new standard in ATTR-Polyneuropathy

And as if all this was not enough, Intellia today reported 2-year data from their phase I/II study of its Cas9 CRISPR agent NTLA-2001.  Unlike prior TTR knockdown agents by Alnylam (RNAi) and Ionis (RNaseH antisense), key mNIS+7 and Norfolk quality of life measures show that after 2 years of sustained -90% TTR reductions, NTLA-2001 not only stabilizes patients, but the majority of patients improve.  In the dose expansion cohort, there was a clinically highly impactful -8.5 point improvement in mNIS+7. 

Clinically meaningful >4 point improvements were also seen in 5 out of the 6 patients that had been on an RNAi treatment (Patisiran) before.  It is also an improvement over what had been observed at the 12-month timepoint before with NTLA-2001 and sends a strong message:

A one-course treatment permanently changing genetics for the better leads to superior outcomes as the body itself becomes the healing agent. 

I look forward to seeing histology data looking at TTR deposition and whether they start to disappear as the balance shifts towards clearance.

The superior outcome may not come as a surprise when considering that with a 90% gene knockout efficacy, NTLA-2001 halves the amount of TTR being produced following therapy compared to what knockdown agents have been able to achieve.  Still, the fact that improvements seem to accelerate over time is remarkable.

Concordantly, there were no new adverse events and illustrates that acute infusion reactions and possibly transient liver damage around LNP administration is the main safety and arguably only concern of liver-directed CRISPR therapeutics.  Safety challenges arising from having to maintain a certain level of drug concentration, which may e.g. lead to low chronic inflammation and associated transcriptionopathies, do not apply to RNA-/oligo-based CRISPR therapeutics.

With this data, NTLA-2001 should own the ATTR-polyneuropathy market, not just because of its superior efficacy and safety, but also because it is a genetically defined disease and could be given earlier, perhaps even before symptoms manifest.  This would be a hard sell from a health economics point of view for drugs that need to be taken chronically for life.  In the same vein, Intellia reported just yesterday that NTLA-2001 similarly improves the lives of people with genetic ATTR-cardiomyopathy, leading to never seen before increases in the 6 minute-walk-distance measure, not with vutrisiran and not with acoramidis.

Phase 3 studies of NTLA-2001 in ATTR-PN and ATTR-CM are ongoing and should gather steam with the new data.

It is possible that together with the recent PCSK9 data by Verve Therapeutics, last week’s developments and increased signs that regulatory flexibility will continue to be applied if not greatly accelerated by the new administration could mean that the worst for CRISPR investors could be behind.