Gene Edit­ing Tech­nol­o­gy’s $50 Bil­lion Mar­ket Op­por­tu­ni­ty

Ge­net­ic med­i­cine is poised to un­lock more val­ue for pa­tients and in­vestors. In the lat­est episode of RBC’s Pathfind­ers in Bio­phar­ma pod­cast, Biotech­nol­o­gy An­a­lyst Lu­ca Is­si high­lights the most promis­ing tech­nolo­gies.

Key points

  • Dis­rup­tive tech­nolo­gies emerg­ing in ge­net­ics med­i­cine in­clude mR­NA – the pow­er be­hind suc­cess­ful COVID-19 vac­cines, now be­ing tri­alled for melanoma treat­ment.
  • Af­ter many set­backs, siR­NA tech­nol­o­gy is al­so start­ing to de­liv­er new treat­ments, with po­ten­tial in ar­eas such as car­diomy­opa­thy.
  • Gene edit­ing is be­ing tri­alled against con­di­tions such as sick­le cell dis­ease: ear­ly da­ta on com­bat­ing the risks as­so­ci­at­ed with this tech­nol­o­gy is en­cour­ag­ing.
  • With an es­ti­mat­ed 27 ge­net­ic med­i­cines al­ready ap­proved, com­pa­nies who can com­bine the right choice of in­ter­ven­tion with strong ex­e­cu­tion stand to ben­e­fit.

Lis­ten to the full episode here or dive deep­er in­to the lat­est ad­vances in ge­net­ic med­i­cine be­low.

Melanoma is a tar­get for mR­NA vac­cines

RBC’s Lu­ca Is­si be­lieves mR­NA (mes­sen­ger ri­bonu­cle­ic acid) is trans­form­ing the vac­cine in­dus­try. Un­like tra­di­tion­al vac­cines, mR­NA does not en­tail in­ject­ing part of an ac­tu­al virus, but an ar­ti­fi­cial ver­sion based on ge­net­ic code. A key ad­van­tage is that these can be man­u­fac­tured rel­a­tive­ly quick­ly and cheap­ly.

Ear­ly da­ta shows promis­ing re­sults for mR­NA in tack­ling melanoma, al­beit based on small stud­ies. In this process, a pa­tient’s tu­mor biop­sy is com­pared with healthy tis­sue to pro­duce mR­NA de­signed to stim­u­late the im­mune sys­tem in a way that at­tacks the can­cer, ex­plains Is­si.

“Every sin­gle pa­tient will get a dif­fer­ent cock­tail of mR­NA – this is the epit­o­me of per­son­al­ized med­i­cine,” Is­si says. While more re­search da­ta is re­quired, he adds, “there is rea­son to be­lieve that this tech­nol­o­gy will not be lim­it­ed to in­fec­tious dis­ease, but will cre­ate val­ue for oth­er in­di­ca­tions.”

In­vestors who stuck with siR­NA were re­ward­ed

Mean­while, ad­vances con­tin­ue in the linked field of small in­ter­fer­ing RNA, siR­NA. This tech­nol­o­gy has ex­ist­ed for many years – An­drew Fire and Craig Mel­lo won a No­bel Prize for its dis­cov­ery in 2006 – but set­backs in tri­als hin­dered de­vel­op­ment, says Is­si.

“Most in­vestors lost hope and left the space. A few de­cid­ed to stay, and were re­ward­ed in a pret­ty im­pres­sive way,” he notes. An in­no­va­tion called GalNAc en­abled safe de­liv­ery of siR­NA, and sev­er­al drugs have now been ap­proved for use.

To­day the tech­nol­o­gy is chiefly used in treat­ments for liv­er con­di­tions, but com­pa­nies are work­ing on ap­pli­ca­tions in oth­er ar­eas, in­clud­ing car­diomy­opa­thy.

“The cu­mu­la­tive val­ue for this field is now $50 bil­lion, if you com­bine mar­ket cap as well as some of the M&A we have seen in that space. In­no­va­tion takes time and nev­er works in a straight line – but dis­rup­tive tech­nol­o­gy can ul­ti­mate­ly suc­ceed.” – Lu­ca Is­si, Biotech­nol­o­gy An­a­lyst, RBC Cap­i­tal Mar­kets

Risks of gene edit­ing ap­pear low

Gene edit­ing is an­oth­er fast-mov­ing and high­ly promis­ing field. Among the pi­o­neers are CRISPR Ther­a­peu­tics, which is con­duct­ing tri­als on the treat­ment of sick­le cell dis­ease.

With some 6,000 so-called mono­genic dis­eases, where a sin­gle gene is the cause, the po­ten­tial ap­pli­ca­tions are huge. As a “one and done” pro­ce­dure – a gene is per­ma­nent­ly edit­ed to fix the dis­ease – this tech­nol­o­gy has dis­rup­tive po­ten­tial, says Is­si.

Again, de­vel­op­ment will take time. Con­cerns in­clude the po­ten­tial for un­in­tend­ed con­se­quences on oth­er genes, and in the chil­dren of pa­tients, though ear­ly da­ta sug­gests the risks in both cas­es may be low.

Pri­or­i­ti­za­tion and ex­e­cu­tion are key to suc­cess

RBC es­ti­mates 27 ge­net­ic med­i­cine drugs now have ap­proval. “This could be just the tip of the ice­berg. We con­tin­ue to be­lieve that ge­net­ic med­i­cine is the next wave of in­no­va­tion in biotech,” Is­si states.

Across the ge­net­ics land­scape, the win­ners will be those who pri­or­i­tize the right con­di­tions for treat­ment – and who have the ca­pac­i­ty to car­ry through im­ple­men­ta­tion.

“I think it’s im­por­tant that with these more in­no­v­a­tive tech­nolo­gies, we first go af­ter in­di­ca­tions with large un­met med­ical need, where you can jus­ti­fy tak­en the risks giv­en the sever­i­ty of the dis­ease,” Is­si con­cludes. And in a cap­i­tal-in­ten­sive sec­tor and a tough eco­nom­ic back­drop, “old school ex­e­cu­tion and strat­e­gy will mat­ter too.”

“This could be just the tip of the ice­berg – we be­lieve ge­net­ic med­i­cine is the next wave of in­no­va­tion in biotech.” – Lu­ca Is­si, Biotech­nol­o­gy An­a­lyst, RBC Cap­i­tal Mar­kets

Gain per­spec­tives from the cut­ting edge of biotech to help you lead to­day and de­fine to­mor­row. Ex­plore RBC’s Pathfind­ers in Bio­phar­ma se­ries.


Luca Issi

Biotechnology Analyst, RBC Capital Markets