UPDATED: Vertex pays $105M to kick off gene editing pact with CRISPR Therapeutics

CRISPR developer Emmanuelle Charpentier

Setting its sights on a potential cure for cystic fibrosis and sickle cell disease, Vertex ($VRTX) is committing $105 million in cash to embrace the gene editing pioneer CRISPR Therapeutics, which has been building a research hub in Cambridge, MA.

Vertex, which has been concentrating on its cystic fibrosis drug franchise in recent years, is paying $75 million in an upfront investment while taking a $30 million equity stake in CRISPR, which was founded on the game-changing gene editing technology developed by the award-winning scientist Emmanuelle Charpentier.

A spokesperson for CRISPR notes that the four-year pact gives Vertex the right to option up to 6 programs, with Vertex and CRISPR sharing the development cost on hemoglobin-related programs, such as sickle cell anemia. CRISPR is keeping the U.S. commercialization rights for sickle cell disease. In other areas, Vertex is paying the freight on development and each program is tied to up to $420 million in milestones--up to $2.6 billion in total.

Initially, CRISPR plans to hone its gene editing tech to fit the new Vertex targets, eventually hiring anywhere from 18 to 20 new staffers over the next 6 to 9 months for the added effort, according to CEO Rodger Novak. By going after CFTR mutations, he adds, it's possible to provide a "significantly permanent intervention" for the lion's share of the patients who suffer from cystic fibrosis. But central to the negotiations, says the CEO, was making sure that the biotech's internal programs--which will be reviewed in the coming weeks--stay on track.

Vertex CSO David Altshuler, CRISPR R&D chief Bill Lundberg as well as CRISPR scientific founder Chad Cowan all have deep roots in the local research community concentrated around MIT and Harvard in Cambridge, MA. And their longtime ties played an integral part in hammering out the partnership, says Novak. 

Vertex "could convince us that their organization is still very research heavy," says Novak. "They did understand genetics."

Vertex scored an FDA approval for its combination cystic fibrosis drug Orkambi last summer, which targets the 8,500 patients in the U.S. whose disease is caused by an F508del mutation in their CFTR genes. The treatment retails for $259,000, which provoked some protests from payers who are forced to cover the cost.

CRISPR has been developed new Cas9 tech that can be used to surgically alter a gene, carving out genetic diseases while opening the door to editing an individual's DNA. The potentially revolutionary approach to treating diseases has inspired a slate of startups, including Intellia and Editas, which have been executing their own big partnership pacts with the likes of Novartis. 

Close on the heels of lining up a $120 million venture round earlier this year, Editas followed up with a major tie-up with CAR-T pioneer Juno.

Vertex CSO David Altshuler

In the meantime, some of the scientific pioneers have been adapting the technology. Editas founding scientist Feng Zhang, in particular, has been working with new cutting tools at the Broad Institute. And Charpentier with Jennifer Doudna, who launched Caribou and outlicensed tech to Intellia, have been challenging patents that are part of Editas' IP.

"As a company founded on innovative science, we're excited to begin this collaboration with CRISPR, as it puts us at the forefront of what we believe may be a fundamental change in the future treatment of disease--using gene editing technologies to address the underlying genetic causes of many diseases," noted Altshuler in a statement.

- here's the release