Thursday was hardly a good day to be a shareholder of Intellia Therapeutics (NASDAQ: NTLA). After the biotech delivered some news from the lab and witnessed one analyst's negative reaction to it, the company's share price closed more than 20% lower.
Intellia, which is a clinical-stage biotech developing medications using cutting-edge, genome-editing technology, delivered its latest news that morning.
The company unveiled the results from a phase 2 trial of its NTLA-2002, which targets hereditary angioedema (HAE), a swelling disorder. The 27-patients study saw the treatment reduce monthly angioedema attack rates by 86% to 81%. In a group of 11 patients using a higher dose of the drug, eight had a complete response to treatment, i.e., they experienced no attacks for up-to eight months after dosing.
Intellia said that NTLA-2002 was generally well tolerated and demonstrated no serious adverse events.
The company talked up the findings of the study, quoting CEO John Leonard as saying that "We are highly encouraged by these results, which we believe sets NTLA-2002 apart from other prophylaxis treatments."
He added that "What was previously an unimaginable potential to be free of chronic therapy is one step closer to becoming a reality for the HAE community."
There are doubts that these results will be sufficient to propel NTLA-2002 and Intellia to prominence and success. After digesting them, Baird analyst Jack Allen assertively lowered his price target on the stock to $18 per share from his previous $24, and maintained his neutral recommendation.
According to reports, Allen acknowledged the efficacy of the drug but cautioned that its performance wasn't sufficient to mitigate the risks of in vivo gene editing.
If I were an investor, I wouldn't yet bail on Intellia. The Baird prognosticator certainly has a point, but this type of drug development is still at an early stage, and the company is clearly leveraging it in a clever way. It might just be a good discount play for investors who aren't risk adverse.
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