Unlocking Biotech’s Hidden Gems
The biotech industry is known for its unpredictability, with stocks often surging on clinical or regulatory breakthroughs. While it’s impossible to predict with certainty which companies will experience a surge, Wall Street analysts can provide valuable insights. One such company is Intellia Therapeutics (NASDAQ: NTLA), a clinical-stage biotech with a significant upside potential.
A Promising Prospect
According to analysts’ consensus estimate, Intellia Therapeutics’ shares could skyrocket by 354% if they reach their average price target of $65. But should you invest in Intellia Therapeutics expecting massive gains? To answer this, let’s delve into the company’s profile and prospects.
Gene-Editing Specialist
Intellia Therapeutics fits the profile of stocks that investors have been shying away from in recent years: speculative and unprofitable companies. As a gene-editing specialist, the company needs to demonstrate significant progress to impress investors. Fortunately, Intellia has two ongoing phase 3 studies that could provide a much-needed boost.
Pipeline Progress
The first phase 3 study is for NTLA-2001, a treatment for transthyretin amyloidosis with cardiomyopathy, a rare disease caused by abnormal protein buildup in body organs. Intellia could provide updates on this study throughout the next 12 months. Additionally, the company plans to start another phase 3 study for NTLA-2001 in treating hereditary transthyretin amyloidosis with polyneuropathy by year-end. Intellia is also running a late-stage study for NTLA-2002, a treatment for hereditary angioedema, a rare condition marked by swelling of the limbs.
Market Potential
If successful, NTLA-2001 and NTLA-2002 could tap into commercial opportunities worth over $11 billion and $6 billion, respectively, by 2029. While it’s unlikely that these treatments will capture the entire market, even a fraction of these opportunities could significantly impact Intellia’s performance.
Risks and Rewards
However, predicting the success of these therapies is impossible, and even promising data from phase 2 clinical trials doesn’t guarantee success in late-stage studies. If either of Intellia’s leading programs fails, its shares could plummet. Despite this, Intellia has some factors working in its favor, including a partnership with biotech giant Regeneron Pharmaceuticals and a solid cash position of $940 million as of June 30.
Is Intellia Therapeutics a Buy?
Intellia Therapeutics remains a high-risk, high-reward play. While it may not be suitable for risk-averse investors, those with a higher risk tolerance might consider initiating a small position in the stock. Ultimately, the company’s performance will depend on the success of its candidates in phase 3 studies.
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