Shares of Prime Medicine, Inc. PRME were up 11.85% after the company announced a strategic research collaboration and license agreement with biotech giant Bristol Myers Squibb BMY.

The collaboration is aimed at developing reagents for the next generation of ex vivo T-cell therapies.

Year to date, PRME’s shares have lost 56.3% compared with the industry’s decline of 1.2%.

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Terms of PRME’s Deal With BMY

Prime Medicine is deploying its proprietary gene editing technology, Prime Editing platform, to develop a new class of differentiated one-time curative genetic therapies.

Per the terms of the deal, Bristol Myers will be responsible for the development, manufacturing and commercialization of the next-generation cell therapies, with support from Prime Medicine in gene editing strategy and reagent development.

In exchange, PRME will receive an upfront payment of $55 million and an equity investment worth $55 million from BMY.

Prime Medicine is also eligible to receive more than $3.5 billion in milestones, including up to $1.4 billion in development milestones and more than $2.1 billion in commercialization milestones, along with royalties on net sales.

The equity investment from BMY impressed investors.

The deal with BMY will allow PRME to apply its Prime Editing technology beyond rare genetic diseases.

PRME’s Strategic Pipeline Progress

Prime Medicine also announced that it is prioritizing development in core areas of focus.  The company will focus on the development of two programs, PM359 and another candidate, for the treatment of chronic granulomatous disease (CGD).

In April 2024, the FDA cleared an investigational new drug (IND) application for PM359. PRME has initiated a phase I/II clinical trial to assess the safety, biological activity and preliminary efficacy of PM359 in adult and pediatric patients. It expects initial clinical data from the study in 2025.

The company’s other program is an ex vivo hematopoietic stem cell product for the treatment of X-linked CGD.

Per PRME, these two programs have the potential to address the vast majority of people living with CGD.

Prime Medicine is also focused on advancing its Wilson’s Disease program, which targets prevalent mutations in the ATP7B gene. The company expects to initiate IND-enabling activities for this program in the fourth quarter of 2024, and intends to file an IND and/or clinical trial application in the first half of 2026.

As a result of this strategic pipeline prioritization, Prime Medicine will streamline its operating expenses and capital expenditures.

Prime Medicine expects its cash runway to fund operations into the first half of 2026 after receiving an upfront payment of $110 million from BMY.

PRME’s Zacks Rank and Stocks to Consider

PRME currently carries a Zacks Rank #3 (Hold). 

Some better-ranked stocks in the biotech sector are Krystal Biotech, Inc. KRYS and Fulcrum Therapeutics FULC, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, estimates for Krystal Biotech’s 2024 EPS have increased from $1.91 to $2.38. The consensus estimate for 2025 earnings has improved from $4.33 to $7.31. Year to date, shares of KRYS have jumped 42.8%.

KRYS’ earnings beat estimates in three of the trailing four quarters and missed the same in one, the average surprise being 45.95%.

In the past 90 days, estimates for Fulcrum Therapeutics’ 2024 loss per share have narrowed from $1.33 to 28 cents. The consensus estimate for 2025 loss per share has narrowed from $1.71 to $1.14.

 

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