HomeMarket NewsCRISPR Therapeutics Q4 Earnings Impressive, Collaboration Revenues Propel Stock Soar

CRISPR Therapeutics Q4 Earnings Impressive, Collaboration Revenues Propel Stock Soar

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Robust Earnings Drive Investor Optimism

CRISPR Therapeutics (CRSP) has exceeded the financial forecasts and jolted Wall Street with a remarkable turnaround in their quarterly report. The company reported an earnings per share of $1.10 for the fourth quarter of 2023, a stark contrast to the estimated loss of 40 cents. During the equivalent period in the previous year, the company had experienced a loss of $1.41 per share.

The stellar performance was largely attributed to the collaboration revenue received from Vertex (VRTX) following the approval of Casgevy (exagamglogene autotemcel [exa-cel]) for two significant blood disorder indications. As a result, CRISPR’s stock soared by 4.7% on February 21, creating ripples of excitement among investors.

Collaboration Revenues – A Catalyst for Growth

Casgevy, a breakthrough therapy, was given the green light by the FDA in the United States for sickle cell disease (SCD) indication in December 2023 and for transfusion-dependent beta thalassemia (TDT) indication in January 2024. The positive developments extended across the Atlantic, with the therapy securing its inaugural approval in the United Kingdom in November 2023, and receiving conditional approval in the EU for both SCD and TDT earlier this month.

This substantial progress translated into total revenues of $201.2 million during the fourth quarter, surpassing the Zacks Consensus Estimate of $138 million. CRISPR’s financial upturn is clearly evident when compared to the meager revenues of less than $0.1 million during the same period last year.

Financial and Operational Highlights

The financial triumph was accompanied by notable reductions in both research and development, as well as general and administrative expenses, attributed to decreased external research, manufacturing, and professional costs. Collaboration expenses, however, witnessed a significant surge, primarily driven by an additional licensing fee owed to Vertex.

CRISPR’s stock has surged by an impressive 64.7% over the past year, significantly outperforming the industry, which experienced an 8.5% decline in the same period.

Zacks Investment Research
Image Source: Zacks Investment Research

Strategic Shifts and Promising Pipeline

Despite the robust figures, CRISPR has made the audacious decision to discontinue the development of first-generation allogeneic CAR T product candidates, CTX110 and CTX130 while shifting its focus towards the next-generation CAR T candidates, CTX112 and CTX131. These candidates are currently being studied in separate phase I/II clinical trials.

Furthermore, the company has exciting plans for the future, with the initiation of studies for CTX112 in systemic lupus erythematosus and the initiation of a phase I study for CTX131 in hematologic malignancies, both scheduled for the first half of 2024.

CRISPR’s in-vivo gene editing programs are also making headway, with the ongoing study of its first two candidates, CTX310 and CTX320, scheduled to be followed by the nomination of additional in-vivo programs targeting both rare and common diseases in mid-2024.

Stock Recommendations and Future Outlook

CRISPR currently holds a Zacks Rank #3 (Hold). While this might raise caution flags for some, it’s worth noting that the stock’s growth potential remains an attractive prospect for many investors.

For investors seeking alternative options in the drug/biotech industry, Puma Biotechnology, Inc. (PBYI) and ADMA Biologics (ADMA) are worthy contenders. PBYI, currently sporting a Zacks Rank #1 (Strong Buy), and ADMA, carrying a Zacks Rank #2 (Buy), present compelling alternatives.

Given the ongoing positive trajectory, the future holds immense promise for CRISPR Therapeutics with the strong possibility of maintaining its upward momentum as it continues to make significant strides in the field of genetic medicine.

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