Cathy Wood, CEO of investment management firm Eric Invest, is known for focusing on companies with significant innovation potential. A choice of her company, Antelia treatment (NASDAQ: NTLA )Match the bill.
Intellia is a mid-cap biotech company that specializes in gene editing and developing drugs for rare diseases. The drugmaker has already performed exceptionally well this year, with shares up 47%. Should investors consider buying shares of Intellia Therapeutics after this run?
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Intellia Therapeutics’ two lead pipeline candidates are lonvo-z and nex-z. The former is an investigational treatment for hereditary angioedema, a rare condition that causes painful episodes of swelling throughout the body, including the limbs and face. Nex-z targets transthyretin amyloidosis, a genetic disease that causes the transthyretin protein to malfunction and can lead to a series of life-threatening heart problems.
Last year, the US Food and Drug Administration (FDA) put two Phase 3 studies on clinical hold for Nex-z after one patient died of liver failure. Here’s the good news: The FDA has now lifted these clinical holds and allowed Antelia’s treatment to proceed with its clinical studies. Since the stock fell following these negative developments last year, it’s no surprise that it’s pulling back while the biotech takes a big step to put these issues in the rearview mirror.
Despite the good news, there are good reasons to remain skeptical about Intellia Therapeutics’ prospects. First, neither the company nor regulators have disclosed whether nex-z caused the liver issues that led to the patient’s death. Without that little bit of information, Antelia’s treatment could, for all we know, run into similar issues in the near future. True, the company is taking a more cautious approach in studying the next step for the next step.
This will exclude patients with certain liver issues (and a number of other health problems), for example, while carefully monitoring for signs of liver inflammation. However, the fact that nex-z could still be responsible for a patient’s death is somewhat worrying. Gene-editing drugs have already had a hard time accelerating commercial efforts because they are typically costly and complicated to administer, making it challenging for third-party payers to adopt them. The lingering safety issue will not make things any easier for the company.
