Editas Medicine Files for CRISPR Technology's First IPO
By Bio-IT World Staff
January 5, 2016 | The first red-hot biotech IPO of 2016 is already upon us, as Editas Medicine of Cambridge, Mass., filed its registration for an initial public offering with the Securities and Exchange Commission this Monday. Editas was the first, but decidedly not the last, company to form in the wake of excitement about CRISPR-Cas9 gene editing technology with the aim of designing new therapies that target genetic defects. The CRISPR system, by far the simplest and most accurate known method for altering the DNA code of living cells, has potential applications in treating genetic disease, cancer, and infections.
Editas has pegged its initial IPO size at $100 million, although as Bloomberg Business notes, that amount is a placeholder and will almost certainly be exceeded. In fact, it’s substantially less than Editas’ current cash on hand; the company has raised over $160 million in private funding and tens of millions more from a partnership with Juno Therapeutics.
Notably, Editas is planning to go public even as an argument over its most foundational patent is still pending resolution, the outcome of which dispute is sure to affect the company’s valuation. Editas derives much of its momentum from its close association with scientific founder Feng Zhang of the Broad Institute of MIT and Harvard, whose patent on the use of CRISPR gene editing in mammalian cells is licensed to the company. That patent could be voided as a result of a plausible claim of priority by Jennifer Doudna of UC Berkeley.
In the meantime, Alex Lash at Xconomy takes note of several interesting revelations in Editas’ IPO registration. Among them: Editas is earmarking as much as $42 million from its IPO for clinical and preclinical trials in two existing programs, for treating the eye disease Leber congenital amaurosis and for cancer immunotherapies co-developed with Juno; the Broad Institute stands to make as much as $68.8 million from each of Editas’ approved products; and Editas has not necessarily secured the rights to any of the intriguing new CRISPR technologies that have emerged from Feng Zhang’s lab.
Editas claims $155 million cash on hand, averaged a net loss of almost $7 million a month in the first nine months of 2015, and derives a small amount of revenue from ongoing commercial partnerships.