CRISPR Therapeutics(NASDAQ: CRSP) and Moderna(NASDAQ: MRNA) have much in common. They're both innovative biotechs working in relatively newer niches of this booming industry.
However, they've moved in the wrong direction this year. CRISPR's shares are down by 27% year to date, and Moderna's are down by 41%. Regardless of their performances so far in 2024, both stocks are worth investing in this month. Read on to find out why.
1. CRISPR Therapeutics
CRISPR Therapeutics recently hit a breakthrough point when it earned approval for its first product, Casgevy, a therapy for sickle cell disease and transfusion-dependent beta-thalassemia. Casgevy is also the first medicine on the market that uses the famous CRISPR gene editing technique. Given this significant milestone, why is the company underperforming the market?
Here are two potential reasons. First, after Casgevy's approval, some investors decided to take some profits. Second, it will take time before Casgevy contributes meaningfully to CRISPR Therapeutics' financial results. Ex vivo gene editing medicines like Casgevy require that patients' cells be collected and used to manufacture the treatment before it's reinserted into them. The process takes a while and can only be done in qualified treatment centers.
Though it's impossible to ignore these factors, investors may be undervaluing Casgevy's prospects. CRISPR Therapeutics partnered with biotech giantVertex Pharmaceuticals to develop and market it. As a result, the medicine earned approval in places a midcap biotech by itself may not have targeted: Saudi Arabia and Bahrain. These markets alone have some 23,000 eligible patients. The partners estimate an addressable market of 35,000 people in the U.S. and Europe.
Casgevy, at a price of $2.2 million in the U.S. -- and very little competition to speak of, at least for now -- could easily vastly exceed the $1 billion in sales milestone. Yes, it might take a little longer than it would if Casgevy were an oral pill, but patient investors should bide their time.
That's why CRISPR Therapeutics is a great stock to buy this month. It hasn't performed well this year, but over the long run, it has the tools to become a major player in the promising gene editing realm. Interested investors should scoop up the company's shares while they're down.
2. Moderna
Moderna made a name for itself during the pandemic by developing and marketing a successful COVID-19 vaccine. Although sales from this product have fallen off a cliff, the company has made plenty of progress.
Moderna is setting a solid foundation that could allow it to perform well over the long run. That starts with newer approvals: Moderna has now earned the green light for an RSV vaccine called mRESVIA and should launch at least one other product within the next couple of years.
The company's combined coronavirus/flu vaccine aced a phase 3 study. It elicited higher immune responses than some individual vaccines in both categories in its late-stage trial.
Few people like getting shots, even if it's necessary to do so. Getting one beats getting two, provided patients don't have to sacrifice efficacy. It looks like that won't be a problem.
Moderna has several other phase 3 candidates -- a potential stand-alone flu vaccine, one for the cytomegalovirus (there currently is none), another for the norovirus, and still another that's being developed as a personalized cancer vaccine in collaboration with Merck. Moderna should recover in time, even of its financial results currently don't inspire confidence.
What does that mean for investors? The stock is down 41% year to date. There are several potential catalysts related to the company's late-stage pipeline on the horizon that could jolt the stock price.
In the long run, Moderna's vast pipeline of mRNA-based products should help it develop plenty of successful candidates. Now is a good time to buy.
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Prosper Junior Bakiny has positions in Vertex Pharmaceuticals. The Motley Fool has positions in and recommends CRISPR Therapeutics, Merck, and Vertex Pharmaceuticals. The Motley Fool recommends Moderna. The Motley Fool has a disclosure policy.
