In the biotechnology field CRISPR is viewed as the Next Big Thing. Journals like the MIT Technology Review have called it “the biggest biotechnology discovery of the century.” For decades money has been poured into bringing down the cost of mapping the genome. Most agree that the mapping problem is behind us as costs are reasonable and still declining. This provides the foundation to take the next step – modifying those genomes.

At a very high level CRISPR is a set of techniques that “has the potential to to achieve precise, directed changes in DNA.” You can think of it like a kind of “cut and paste” tool for the genome.

Editas (NASDAQ:EDIT) completed their IPO this week in a difficult market and is now the first “pure play” on CRISPR. As we evaluate Editas as an investment opportunity we'll cover some of the advantages CRISPR offers in terms of drug development but also acknowledge the long, expensive and uncertain path of bringing these therapies from the lab to FDA-approved commercial products.

EDIT is trading close to their original $16 bottom-of-the-range IPO price after a brief pop to $18. This suggests some caution from institutional buyers in what has been a bad market so far this year. The company sold 6.8 million shares, raising $108M in the IPO. With 36.6 million shares out this puts the market capitalization at just under $600M.

Editas has positioned themselves a kind of platform company that plans to develop a broad range of drug therapies on top of the CRISPR technology while also innovating around the core technology to enhance it to suit their needs. The founders and advisory board include Feng Zhang of the Broad Institute who holds key patents (for now) and George Church of Harvard Medical School, MIT and the National Academy of Sciences. Church is a bit of a rock star in the CRISPR space at this point.

An operating management team has somewhat hastily put in place along with a board that is mostly a mix of biotechnology venture investors. The team will need some time to “gel” as a team. The company acknowledges in their prospectus that their internal controls need work.

The Editas strategy is a combination of broad activity in terms of research programs (for which they hope to attract larger partners) and focused drug development for specific genetic-based diseases. The lead program targets a congenital eye disease called Leber Congenital Amaurosis 10 “LCA10” which causes progressive blindness. The problem is a defect in the genome which results in the wrong protein being produced, which causes the blindness.