This is from the Motley Fool five days ago:
Sangamo’s stock has been red-hot over the past 12 months due to the growing interest in all-things gene therapy. The backstory is that Sangamo struck a series of licensing deals with biopharma heavyweights Gilead Sciences (NASDAQ: GILD) and Pfizer (NYSE: PFE) to develop next-generation therapies for cancer and rare diseases like the bleeding disorder hemophilia.
The Gilead partnership centers around creating adoptive cell therapies that can be manufactured at scale using Sangamo's zinc-finger nuclease (ZFN) gene-editing platform. The current generation of adoptive cell therapies require extensive manufacturing processes that can delay treatment, and create backlogs of patients.
That being said, Gilead's decision to tap Sangamo's ZFN platform did surprise most Wall Street analysts and industry insiders. The consensus was that Gilead would ultimately go the CRISPR route for its gene-editing needs. After all, Sangamo's ZFN platform is more labor-intensive and time-consuming than CRISPR. With serious questions currently swirling around CRISPR's safety in human subjects, however, Sangamo's ZFN tech was apparently the more compelling choice for Gilead at this stage in the game.
The big ticket item for investors here is that this gene-editing deal with Gilead could eventually translate into a whopping $3 billion in total milestone payments for Sangamo -- that is, if things go according to plan. That's a staggering opportunity for a company with a market cap of less than half that amount at present.
Sangamo's severe hemophilia A partnership with Pfizer is also on track to produce preliminary data by mid-year. If successful, this partnership may trigger buyout talks between the two companies. Pfizer, after all, has deep interests in novel treatments for rare diseases, and the biopharma is currently in the process of ramping up its adoptive cell therapy pipeline as well. Put simply, Sangamo would be a near-perfect fit for Pfizer.
Aside from the possibility of a buyout from one of its partners, Sangamo's deep and robust gene therapy platform also offers up another compelling reason to own this stock right now. Sangamo could run into some bad luck in the clinic, but the sheer breadth of its cutting-edge pipeline should ultimately land the company a commercial-stage product at some point.
So, like its clinical-stage peer Jounce, Sangamo's risk-to-reward ratio is arguably heavily skewed toward the upside as things stand now. The biotech's 10.8% drop last week therefore comes across as an incredible buying opportunity for investors with a long-term mind-set.
From The Motley Fool
