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5 Gene Therapy Stocks to Enrich Your Portfolio

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The next big thing in the biotech space is shaping up to be gene-replacement therapy to treat an array of diseases, including inherited bugs. It is one of the safest and effective ways to treat specific disease causing genes, and it is either done directly in the human body or by extracting cells, engineering them in the lab, and then injecting back into the patient.


Shares of gene-therapy companies are rising even more now after Roche Holding AG (RHHBY - Free Report) announced plans to acquire Spark Therapeutics, Inc. (ONCE - Free Report) for $4.8 billion. Roche acquired the gene therapy pioneer for a 122% premium, which is about to introduce a treatment for a rare eye disease in the market. Lest we forget, Spark Therapeutics’ drug Luxterna was approved way back in 2017 to treat inherited retinal diseases that lead to blindness. By the way, Spark Therapeutics’ major drug SPK-8011 is a factor VIII gene transfer treatment for inherited blood disorder hemophilia A.


Meanwhile, Roche is expected to acquire all outstanding shares of Spark Therapeutics’common stock, while the latter will recommend its board to allow its shareholders tender their shares to Roche. The acquisition of Spark Therapeutics shows that established big pharma companies are interested in making huge investments in genetic cures and treatments. And it is widely believed that the deal has paved the way for more merger and acquisitions in the space.


Analysts at Janney Montgomery Scott rightly pointed out that the deal will not only have an encouraging impact on investor sentiment toward gene therapy names, but also on the broader medical industry. In fact, they added that “given advancements in manufacturing, de-risking on dosing safety and efficacy, fast development times for rare disease, and favorable regulatory environment, the space is appealing and differentiated as a growth investment.”


That’s why we are bringing you the best gene therapy stocks that have not only soared on the deal news but are also poised to make the most of the next gene revolution.


Solid Biosciences


Solid Biosciences Inc.’s (SLDB - Free Report) lead product candidate includes SGT-001, a gene therapy that is in Phase I/II clinical trials to restore functional dystrophin protein expression in patients’ muscles. The company currently flaunts a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


Shares of Solid Biosciences jumped 9.6% on Feb 25 buoyed by the news of Roche’s acquisition of Spark Therapeutics. The company’s expected earnings growth rate for the current quarter is a solid 30.9%.


In fact, the stock’s projected earnings growth rate for the current year is 23.3%, higher than the broader Medical - Biomedical and Genetics industry’s expected gain of 9.5%.


REGENXBIO


REGENXBIO Inc. (RGNX - Free Report) is a clinical-stage biotechnology company that focuses on the development, commercialization and licensing of recombinant adeno-associated virus gene therapy. Its products include RGX-501 for the treatment of homozygous familial hypercholesterolemia.

The Zacks Rank #3 (Hold) company climbed 16.2% on the deal news. The company’s expected earnings growth rate for the current quarter is a promising 37.3%. Actually, the stock’s projected earnings growth rate for the current year is 195.5%, way more than the broader Medical - Biomedical and Genetics industry’s expected gain of 9.5%.


In the past 60 days, REGENXBIO has seen two earnings estimates move north, while none moved south for the current year. The Zacks Consensus Estimate for earnings rose 4.9% in the same period.

 

 

Editas Medicine


Editas Medicine, Inc. (EDIT - Free Report) operates as a genome editing company. It recently entered clinical trials with CRISPR-based gene editing tools.


Following the deal news, the Zacks Rank #3 company gained 5.3%. The company’s expected earnings growth rate for the current quarter is a favorable 50%.


As a matter of fact, the stock’s projected earnings growth rate for the current year is 25.2%, higher than the broader Medical - Biomedical and Genetics industry’s expected gain of 9.5%. The Zacks Consensus Estimate for its current fiscal year earnings has moved up more than 100% in the past 90 days.

 


UniQure


uniQure N.V. (QURE - Free Report) engages in the discovery, development, and commercialization of gene therapies especially in the Netherlands. The Zacks Rank #3 company develops AMT-060, which is in Phase I/II clinical trial to treat hemophilia B.


Shares of uniQure surged 34.3% on the deal news. The company’s expected earnings growth rate for the current quarter is a superb 27.5%. In fact, the stock’s projected earnings growth rate for the current year is 16.3%, more than the broader Medical - Biomedical and Genetics industry’s expected gain of 9.5%. The Zacks Consensus Estimate for its current fiscal year earnings has moved up more than 100% in the past 60 days.

 


Spark Therapeutics


The news that Roche has acquired Spark Therapeutics helped shares of the latter skyrocket 120.1%. Spark Therapeutics is basically known for the development of gene therapy products for patients suffering from debilitating genetic diseases.


The Zacks Rank #3 company’s expected earnings growth rate for the current quarter is a solid 8%. The stock’s projected earnings growth rate for the current year is 112.8%, way higher than the broader Medical - Biomedical and Genetics industry’s expected gain of 9.5%. The Zacks Consensus Estimate for its current-quarter earnings has moved up more than 100% in the past 60 days.

 


Breakout Biotech Stocks with Triple-Digit Profit Potential


The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.


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