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A Comprehensive Guide to Genomic ETFs

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Scientists across the world are researching some inconceivable biological concepts like creating a gene-edited human baby or a human-animal hybrid embryo or curing diabetes and obesity by making some changes in the DNA. The science behind these revolutionary concepts is genome editing.

Genome editing is a technique to alter or modify the DNA of a cell or organism. It uses an enzyme to cut the DNA at a particular sequence and then it is repaired by the cell, making a change to the sequence, per the verified sources. As a result, the characteristics of a cell or organism are changed.

Given the growing applications of gene-editing, it is a rising market which offers endless opportunities. According to analysts, growing demand for personalized medicine, solid investments and higher R&D activities will soon make genomics the next big thing in the investing space. In fact, going by a MarketsandMarkets report, the $18.9-billion global genomics market is expected to reach $35.7 billion by 2024, at a CAGR of 13.5%.

Genomic-Editing Market on a Tear

The genomic-editing space has come under the spotlight with the release of encouraging data from the first-ever human study assessing an in vivo CRISPR-based gene editing therapy candidate, NTLA-2001. Notably, CRISPR (Clustered Regularly Interspaced Short Palindromic Repeats)/Cas9 is a very efficient and fast technique to edit genomes. It is also worth noting here that the CRISPR/Cas9 segment delivered robust performance and contributed for the largest revenue share of 40.2% in 2020, as mentioned in a Grand View Research report.

On Jun 26, Intellia Therapeutics, Inc. (NTLA - Free Report) and Regeneron Pharmaceuticals, Inc. (REGN) released positive interim data from an ongoing Phase 1 clinical study of NTLA-2001, which is being developed as a single-dose treatment for transthyretin (ATTR) amyloidosis. Intellia’s gene editing study data is being considered a major milestone in the field as it highlighted for the first time that gene editing can work in a human. Notably, the results “decisively exceeded” analyst expectations, per a Fierce Biotech article.

A rise in the utilization of CRISPR genome editing technology is being observed in the diagnostics space. Amid the pandemic, CRISPR-based novel diagnostic tools developed to mitigate the adverse impact of the COVID-19 pandemic have created new opportunities, per the verified sources. In fact, a group of researchers from the Nanyang Technological University developed a CRISPR technology-based diagnostic test, VaNGuard (Variant Nucleotide Guard), to detect mutated SARS-CoV-2 strains in March 2021, per a Grand View Research report.

The gene-editing space also grabbed eyeballs with the announcement of the 2020 Nobel Prize winners for Chemistry. The prestigious award was won by Jennifer Doudna, PhD, and Emmanuelle Charpentier, PhD, who are considered pioneers in the development of CRISPR technology as a “genetic scissors.”

Key Players in the Gene-Editing Space

Companies such as Editas Medicine (EDIT - Free Report) , CRISPR Therapeutics (CRSP - Free Report) and Beam Therapeutics (BEAM - Free Report) are using the CRISPR/Cas9 gene-editing technology to develop their respective candidates for addressing various ailments. CRISPR Therapeutics’ lead pipeline candidate is CTX001, an investigational ex vivo CRISPR gene-edited therapy, which is currently being developed for treating transfusion-dependent beta thalassemia (TDT) and sickle cell disease (SCD). The company is co-developing CTX001 in partnership with Vertex Pharmaceuticals (VRTX).

Other than CRISPR Therapeutics, Editas Medicine works with 2 distinct CRISPR nucleases: Cas9 and Cas12a. The company’s lead pipeline candidate is EDIT-101, which employs CRISPR gene editing to treat LCA10 — a rare genetic illness that causes blindness.

A Thorough Guide to Genomic ETFs

The above-mentioned trends have been benefiting genomics ETFs. Here we highlight a host of ETFs that investors can keep a tab on:

ARK Genomic Revolution ETF (ARKG - Free Report) — up 54.2% in the past year

This is an actively-managed ETF focusing on companies likely to benefit from the extension and enhancement of the quality of human and other life by incorporating technological and scientific developments plus improvements and advancements in genomics into their business. The fund typically holds 30-50 stocks in its basket. The fund charges 0.75% in expense ratio. It has accumulated $9.28 billion in its asset base (read: Top-Performing Biotech ETFs of Last Week).

Global X Genomics & Biotechnology ETF (GNOM - Free Report) — up 27.3%

This is a new entrant in the space, having accumulated $243.9 million since its inception on Apr 5, 2019. It seeks to invest in companies that stand to benefit from advancements in the field of genomic science, such as companies involved in gene editing, genomic sequencing, genetic medicine/therapy, computational genomics and biotechnology. The product follows the Solactive Genomics Index, charging 50 basis points in annual fees. It holds 40 stocks in its basket (read: 4 ETF Areas Surged Last Week).

iShares Genomics Immunology and Healthcare ETF (IDNA - Free Report) — up 26.2%

This is another new entrant, which was launched in June 2019. Tracking the NYSE FactSet Global Genomics and Immuno Biopharma Index, the fund provides exposure to developed and emerging market companies that could gain from long-term growth and innovation in genomics, immunology and bioengineering. It holds a basket of 49 securities. The fund has AUM of $322.6 million and charges a fee of 47 basis points (read: Moderna ETFs to Rise on Positive COVID-19 Vaccine Updates).

Invesco Dynamic Biotechnology & Genome ETF (PBE - Free Report) — up 26%

This fund follows the Dynamic Biotech & Genome Intellidex Index. The index comprises companies that are majorly engaged in the research, development, manufacturing and marketing plus distribution of various biotechnological products, services and processes and companies that gain significantly from scientific and technological advances in biotechnology and genetic engineering and research. The fund holds 31 stocks in its basket. It has managed $293.1 million in its asset base. Expense ratio is at 0.58% (read: Biotech ETFs Surge on Biogen's Alzheimer Drug Approval).

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