Quick Summary

Editas Medicine (EDIT) is early-stage biotech focused on developing human therapeutic applications using the CRISPR-Cas9 ("CRISPR") gene-editing technique. CRISPR is a method that uses the body's natural immune response to essentially cut and potentially replace problem strands of DNA that cause various diseases. The promise of CRISPR is accuracy, low cost, and (if done at an early enough stage), permanence, removing an inheritable disease from a bloodline forever. At this stage, Editas is still pre-revenue, with income coming only from R&D partnerships and early licensing payments. The company has 3 primary treatment candidates. EDIT-101 targets LCA10, a form of blindness. This treatment is currently in phase 1/2 trials, and Editas is partnering with AbbVie for distribution. Its other two candidates are pre-trial. EDIT-102 targets Usher syndrome type 2A and EDIT-301 is for sickle cell disease and beta-thalassemia.

Does The Company Have Recurring And/Or Rising Revenues?

NO. In fact, Editas has no product or license revenues to speak of as of now, and its ongoing success as a company depends on highly uncertain clinical development of CRISPR in human applications. There is substantial revenue potential, however. The peak market for EDIT-101 could approach $1 billion per year, and EDIT-102 and 301 both target conditions that are more than twice as prevalent as LCA10. Longer-term, Editas stands to benefit greatly if CRISPR is able to fulfill its promise of treating chronic hereditary diseases.

Does The Company Have Durable Competitive Advantages?

NO. The potential applications of CRISPR and the fact that was discovered almost simultaneously by two different research teams make its licensing situation confusing and uncertain. There does not seem to be any clear-cut patent advantage that would prevent competitors like Intellia and CRISPR Therapeutics from competing with Editas. In fact, CRISPR is far ahead on a competitor to EDIT-301, which is already in phase 1/2 trials. The only conceivable moat for Editas is REGULATORY BARRIERS, and given the developing competitive situation, we don't believe this applies at this time.

GreenDot Rating: RED

Editas is an exciting company pursuing some really exciting, next-generation medical applications. While there is the potential for big revenue gains, and potentially a regulatory moat down the road, the company's current lack of revenues and the uncertain legal status of its patents lead us to give it a RED (unattractive) rating at this point in time. That rating could change in the future as the firm's outlook becomes more clear. It is just too speculative at this point in time.