• U.S. regulators have placed a clinical hold on CRISPR Therapeutics’ lead candidate, spurring a double-digit drop in the Swiss biotech’s stock value by Thursday morning.
• The hold targets the Investigational New Drug application for CTX001, an ex vivo gene-editing therapy that CRISPR and partner Vertex Pharmaceuticals are testing as a treatment for sickle cell disease in the U.S. and beta-thalassemia in Europe. CTX001’s intended effect is to make the body produce more fetal hemoglobin in red blood cells — which the companies believe could help transfusion requirements for β-thalassemia patients and sickle crises for sickle cell patients.
• CRISPR and Vertex said they are awaiting more information from the Food and Drug Administration about the rationale behind its hold. The drugmakers received a thumbs up from European regulators earlier this year to start a trial of CTX001 in adults with transfusion dependent β-thalassemia, and plans for that Phase 1/2 study remain “unchanged,” according to a May 30 statement.

Shares of both Vertex and CRISPR sunk in after-hours trading Wednesday following announcement of the hold. Vertex, which benefits from a slate of profitable cystic fibrosis drugs, mostly rebounded by Thursday’s market open. CRISPR wasn’t so fortunate.

The smaller biotech has no therapies in the clinic. CTX001 is the most advanced, and a sort of bellwether for its parent’s eponymous CRISPR/Cas9 gene-editing platform — upon which CRISPR’s entire business rests.

CRISPR/Cas9 platforms have garnered considerable interest from the industry for their disease-curing potential. But, as is often the case with new technology, setbacks have arisen. Chief among them is a fear that gene-editing treatments may not be safe. The FDA’s clinical hold therefore may have stoked those fears, pushing CRISPR shares down 15% to $62.49 apiece.

Until the FDA provides more information, it’s hard to gauge the fairness of the CRISPR sell off. If regulators need more data from already conducted pre-clinical studies, the biotech could in theory gather and submit that rather quickly. If the agency requires CRISPR to undertake additional studies, however, the submission timeline could be significantly extended.

In either case, the clinical hold is a reminder to CRISPR and its shareholders that new technologies and innovative therapies rarely make it through drug development without hitting turbulence or delays.

“In the U.S., we are on track to file an IND for sickle cell disease and we’ll also file outside the U.S,” Vertex CEO Jeffrey M. Leiden said during the company’s first quarter earnings call in April. “And again, depending on exactly when we do that, we anticipate starting dosing soon thereafter. So my hope is we’ll be dosing in both diseases this year, and that should allow us to start to generate some data in patients.”