(Bloomberg) -- The US Food and Drug Administration approved the first gene editing therapy using Crispr technology on Friday, a collaboration between Vertex Pharmaceuticals Inc. and Crispr Therapeutics AG for treating sickle cell disease.

Called Casgevy, the approval will allow the drug to come to market in the US. Sickle cell disease affects some 100,000 Americans. Vertex says Casgevy is meant for the around 20,000 that have a severe version of the illness. The disease can land some people in the hospital multiple times a year.

The treatment works by precisely targeting changes in DNA to repair flaws in patients’ genomes related to the inherited disease. It promises a potential cure, but requires undergoing an intense several month treatment process and costs $2.2 million. It’s unclear whether insurers will widely cover the therapy, or if many sickle cell patients will take it.

The FDA’s approval is a positive sign for the the burgeoning field of gene editing, which makes permanent changes in human DNA in order to treat — and potentially cure — diseases. Drug companies and patients are looking to gene-editing technology to fix some of the most intractable disorders, such as sickle cell disease. The FDA’s blessing is a sign that regulators believe the benefits of the one-time treatment outweigh any potential safety concerns about altering human DNA.

Crispr’s researchers were awarded the 2020 Nobel Prize in chemistry. In November, regulators in the UK approved Vertex and Crispr’s Casgevy. Goldman Sachs analysts estimate the treatment will generate $3.9 billion globally in peak sales.

Investors had widely expected the approval on Friday, but shares of Crispr fell as much as 12% as the surprise approval of a rival sickle cell disease drug from Bluebird Bio Inc., Lyfgenia, was also announced the same day. 

Vertex shares fell less than 1% at 3:28 p.m. in New York, while shares in Crispr Therapeutics fell 7.9%.

Lyfgenia Risks

Lyfgenia’s approval came with what’s known as a “black box warning” saying patients on the treatment should have lifelong monitoring for blood cancer after cases occurred in people who’ve received it. 

Bluebird’s stock rose as much as 15% earlier Friday but the shares were halted after starting to fall following the FDA nod for Lyfgenia. When trading resumed, the stock sank as much as 44% — the biggest drop its ever had. 

On a call with reporters, FDA officials said they added the warning to Bluebird’s therapy after two patients died from blood cancer during a clinical trial. The treatment from Vertex and Crispr doesn’t have a similar warning because the companies didn’t have any patients with malignancies during their clinical trials, the officials said. Vertex and Bluebird have agreed to do long-term follow-up studies on patients for 15 years.

Peter Marks, director of the FDA’s Center for Biologics Evaluation and Research, said he expects most medical providers to only give the treatments to patients who are in the hospital several times a year.

“This is really for those whose lives have been significantly impacted,” Marks said.

Bluebird said Lyfgenia will cost $3.1 million, though the company said it’s in “advanced” talks with payers that cover some 80% of sickle cell patients already. 

Possible Cure

Both therapies promise potential relief — and possibly a cure — for sickle cell disease, which largely affects Black people in the US. The life expectancy of people who have sickle cell disease and are covered by Medicaid and Medicare is about 53 years, according to a study published in July.

Sickle cell is an inherited disease where misshapen and inefficient red blood cells lead to clogged blood vessels, painful episodes and shortened lifespans. 

Bloomberg Intelligence analyst Ann-Hunter Van Kirk said the negative investor reaction Friday was likely due in part to the FDA highlighting the required chemotherapy treatments that patients must undergo when using the Crispr therapy and “concerns on how that will impact uptake.”

Still, she said, the FDA approvals are “an important debut of the next frontier of therapies.”

--With assistance from Fiona Rutherford and Ike Swetlitz.

(Updates shares, with comment from FDA officials starting in paragraph 12 and with analyst comment.)

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