While traders enjoyed a day off as the Easter long weekend arrived, there was plenty of news that took place since the markets closed on Thursday. Among other developments, gene-editing darling Editas Medicines (NASDAQ: EIDT) tumbled after announcing a surprise executive shakeup. In particular, the company’s chief executive officer officially stepped down from his role, one of many recent departures which have left shareholders a bit concerned.
After hardly less than a year in his position, Editas Medicines CEO Jim Mullen confirmed that he would be stepping down from the company. In his stead, former chief medical officer Gilmore O’Neill will be his replacement, bringing a bit more direct clinical development experience to the CEO role.
Although Mullen has helped Editas make massive clinical advancements, most gene-editing stocks have crashed over the course of this past year. That’s probably one reason why management has constantly been reshuffling. This includes Editas’ previous chief medical officer, Lisa Michaels, who left just two months ago, among many other senior executives.
The prior CEO before Mullen, Cynthia Collins, departed last February. Despite being a favorite darling among the gene-editing biotech sector, Editas’ dramatic leadership shakeups have started raising eyebrows among some investors. The company’s new CEO, O’Neill, will officially begin his role by June.
“Clearly, one of the things that’s been missing from this company is this very experienced, accomplished drug development background that can connect the medicine with the science. [O’Neill] is exactly the profile we need at this moment in time,” said Mullen in an interview. “What we have to do is focus in a pragmatic manner and find ways to balance the bandwidth of an organization and its business partners in actually delivering on these technologies,” added O’Neill.
Editas currently has ten different clinical programs going on right now. Most still aren’t in human testing yet. Out of the three that have, one targets a rare eye disease, and the other two go after blood disorders.
Shares of Editas were down around 11.5% following the news. Since January, Editas has plummeted over 35%, and down over 51.2% compared to last year. Six analysts have a “buy” rating, while another seven have a neutral “hold” rating instead, a big shift from a couple years ago.
Other similar stocks, like CRISPR Therapeutics (NASDAQ: CRSP), were also down as well by association. Poor news for one gene-editing company quickly spills over to other stocks’ trading behaviour as well. CRISPR has been down 55% since last year, as is Sangamo Therapeutics (NASDAQ: SGMO), another popular CRISPR-stock.
Editas Company Profile
Editas Medicine Inc is a gene-editing company. It is engaged in treating patients with genetically defined diseases by correcting disease-causing genes. The company focuses on developing a proprietary genome editing platform based on clustered, regularly interspaced short palindromic repeats (CRISPR)/ CRISPR-associated protein 9 (Cas9 technology). It has developed CRISPR/Cas9 technology which uses a protein-RNA (ribonucleic acid) complex composed of the Cas9 enzyme bound to a guide RNA molecule designed to recognize a DNA (deoxyribonucleic acid) sequence that requires repair. The company’s only operating segment is developing and commercializing genome editing technology. – Warrior Trading News
