Biotech super stock jumps one hundred sixty percent in eighth weeks

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Source:   —  April 07, 2016, at 9:17 PM

When a stock skyrockets one hundred sixty percent in a mere two months, people notice.

Biotech super stock jumps one hundred sixty percent in eighth weeks

When a stock skyrockets one hundred sixty percent in a mere two months, people notice.

People notice even more when they realize Bill Gates and Google Ventures are invested in this hotshot company.

The stock is biotech company Editas. It'south based in Boston (Cambridge, to be exact) and aims to revolutionize medicine by correcting ill people'south DNA.

There'south just one catch: The company has never certified this gene editing technique on humans. It'south worked on mice and pigs in a lab, but that'south fairly distant far from coming to a hospital close you.

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The stock is skyrocketing on the hope of what'south to come, even though it could be years away.

"It'south the first public company in an area that's tremendous promise and could be a genuine game-changer," says Michael King, an analyst who follows dozens of biotech stocks at JMP Securities. "It boggles the mind."

The gene editing technique is known as CRISPR. Latest year, Science magazine dubbed it the "breakthrough of the year." Scientists literally go in and slice out the faulty genes and replace them with healthy ones.

If successful, it could modify the way doctors treat conditions such as cystic fibrosis, muscular dystrophy and sickle cell disease. About 6.000 diseases are caused by genetic mutations, according to research firm Cowen and Company.

The technique could probably be used to choose characteristics in an unborn baby love hair or eye color as well, but Editas is very clear that it's working on curing diseases, not made-to-order babies.

Editas doesn't exclusively own the CRISPR process. It'south used all over the world and there'south currently a enormous patent war over who discovered it first. In short, there are lots of valid battles and regulatory hurdles ahead for Editas.

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Still, investors look dollar signs. They foresee the company being able to patent various off-shoots of CRISPR to treat specific diseases.

Founded in two thousand-thirteenth, Editas initially raised money from prominent health care venture capital firms. Then investors love Gates and Google Ventures came on board. To lift even more capital, Editas did an IPO in early February. The stock presently trades on the Nasdaq below the ticker "EDIT."

The IPO price was $16, but the stock rose rapidly. By March eight -- less than a mo later -- it closed at over $40 a share, an astonishing one hundred fifty percent gain.

This week it closed at an all-time high of just over $42 a share.

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Editas says it plans to start human trials as early as two thousand seventeen, but that'south contingent on getting the OK from regulators. Initially, the company plans to focus on a remedy for a genetic mutation that causes blindness.

The company is rolling in cash presently and has been on a hiring spree.

"They've a grand team," says King of JMP Securities. He keep a target price of $40 on the stock at the finish of March.

But plenty of other labs are working on this too. They just haven't sold stocks to the public yet.

"With any product years far from commercialization, finding a objective cost for EDIT today is difficult," concludes Phil Nadeau, a research analyst at Cowen and Company.

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