Shares of Crispr Therapeutics (CRSP) - Get CRISPR Therapeutics AG Report rose Tuesday after it said it would receive a $900 million payment from fellow biotech firm Vertex Pharmaceuticals (VRTX) - Get Vertex Pharmaceuticals Incorporated Report.
The payment is for rights to 60% of the profit from sales of the CTX001 gene-editing therapy. If regulators clear the drug for marketing, Vertex will pay out another $200 million.
CTX001 is an investigational gene-editing therapy that the companies jointly developed to treat sickle-cell disease and transfusion-dependent beta-thalassemia. It’s currently in Phase 1 and 2 trials.
“Vertex will be responsible for 60% of program costs and will receive 60% of profits from future sales of CTX001 worldwide, representing a 10% increase in program economics compared to the previous agreement,” the companies said.
Shares of Crispr, Zug, Switzerland, recently traded at $118.19, up 2.6%. The stock on Tuesday has traded up as much as 9.1% at $125.48. It has climbed 12% in the past six months.
Shares of Vertex, Boston, traded little changed at $219.10. They have eased 0.4% over the past six months.
“We see a significant commercial opportunity for CTX001, and we believe we will be able to further enhance that opportunity by fully leveraging the breadth of Vertex’s capabilities,” said Vertex Executive Chairman Jeffrey Leiden.
In February, TheStreet.com Founder Jim Cramer said of Vertex, "I don't know why this one is as low as it is."
Vertex shares fell in October after the company said it was halting development of its VX-814 drug for a lung and liver malady due to liver toxicity, and some analysts reacted negatively.