Gene editing loses its sizzle. CRISPR Therapeutics IPO debuts beneath the range
Some of the bloom has come off the rose of gene editing. CRISPR Therapeutics had to accept $14 a share to launch its IPO, a bit below the range that it had set for itself. And that had to be a disappointing debut after rivals Editas and Intellia were both able to fire off hot offerings earlier in the year — though they have also been feeling the chill more recently.
CRISPR Therapeutics $CRSP still came away with $56 million from the maiden offering, adding $35 million with a sale of 2.5 million shares to its big partner Bayer under their earlier pact. Add it up and the $91 million does drop into the same ballpark as the $94.4 million score by Editas and the $108 million reaped by Intellia in the spring. But it’s significantly less than what the biotech was angling for.
These companies have been developing preclinical programs relying on CRISPR-Cas9 gene editing technology, adapting what’s been widely billed as a faster, cheaper way to slice and splice DNA in pursuit of new treatments. And each have plans to cautiously leap from animals into humans, leaving the field full of promise but years away from any actual product. More investors may be waking up to the fact that this is one revolution that is likely to play out in slow motion.
That may be why Editas shares $EDIT have swooned, sliding from a high of to $44 to yesterday’s close of $13.81, below its debut price. Intellia $NTLA has also been feeling the chill, dropping from $30.40 to yesterday’s close of $12.02. Earlier this year gene editing had been one of the few bright spots among a significantly reduced stream of biotech IPOs, as the big boom of 2013-2015 faded.
The latest gene editing IPO leaves the three top players on full public display, with a fourth, Caribou, still operating privately with venture backing.
CRISPR Therapeutics, headed by CEO Rodger Novak and based in Switzerland with R&D in Cambridge, MA, has been playing its cards close to its vest in recent months, but it sent a clear signal about the upcoming IPO in June, when it added a completely unneeded $38 million to its last venture round, taking it to a whopping $140 million. Biotechs that go public these days need plenty of cash in the bank and insider investors lining up to buy shares.