You can make huge gains investing in a breakthrough drug, but you can do even better putting your money into a new, cutting-edge technology platform that can fuel a company's entire pipeline.
One biotech I recommended to my BioScience Millionaire subscribers last July, Sangamo Biosciences Inc. (Nasdaq: SGMO), has developed a technology from naturally occurring molecules, called zinc finger proteins (ZFPs), that scientists can engineer to edit specific genes in the human genome. It can cut them out, replace them, or add new ones – in other words, it plays with the basic building blocks of life as if they were Lego pieces!
Sangamo is currently using ZFP technology to find cures for some of the most intractable – and often un-druggable – diseases we know of, including HIV, Alzheimer's, Huntington's, and Down's syndrome to name a few.
And Sangamo isn't the only company using ZFPs for research. In fact, it licenses out the technology to scientific institutions and companies all over the world – providing it with a great revenue stream.
As a result, SGMO shares have gone up more than 150% since last summer. Actually, if you'd had the foresight to buy the stock at the beginning of 2012, you'd now be realizing profits of 577% on your money.
The magic word in that sentence is "foresight." The trick is to spot these technologies early in their development, either before they've had IPOs or soon after.
With that in mind, here are a few exciting new technologies to keep an eye on…
Breakthrough No. 1
Amazing Work with Genes
Last year I had the privilege of being the only bioscience writer to attend a privately held international conference in New York City on inflammatory bowel disease. One hundred of the top researchers in the world were there, and one of them, a scientist from Harvard, specifically mentioned ZFPs (see above) as central to his work. He also mentioned a similar gene editing tool called TALENS. But the really exciting one, which he spoke about in passing, is called CRISPR.
CRISPR stands for Clustered Regularly Interspaced Short Palindromic Repeats. I know. Don't ask. The explanation is as long, complex, and sleep-inducing as you might suspect.
But the short version is this: ZFP and TALENS use proteins to do their gene editing, and proteins are – in the sub-microscopic world – big and unwieldy. It's very hard to manipulate them to produce the mass quantities of re-sculpted genes you would need to treat some diseases.
CRISPR, on the other hand, uses very small bits of RNA (ribonucleic acid, a chemical present in all living cells) to achieve the same ends, and comparing it to ZFP and TALENS is like comparing a scalpel to a hatchet. It is fast, precise, and can produce edited genes en mass.
Over the past year, CRISPR has been showing up in labs all over the world and has turned into a tech platform for several new biotechs. Sangamo need not worry – ZFPs and TALENS will always have a secure place in research, because CRISPR does have some limitations, but it's likely to dwarf their success.
About the Author
Ernie Tremblay has more than 25 years of experience in following and analyzing the latest developments in health, medicine, and related technologies. He understands the FDA approval process, as well as the "hard science" behind new, experimental drugs and the market demand for them - and has a comprehensive grasp of the complex dynamics that determine whether a new drug will be a breakthrough winner, or just another casualty of the FDA approval process.