Why Sangamo Therapeutics Stock Is Soaring Today

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What happened

Shares of Sangamo Therapeutics (NASDAQ: SGMO) were soaring 30.9% higher as of 11:19 a.m. EDT on Tuesday. The biotech and its partner, Pfizer (NYSE: PFE), just announced encouraging interim data from a phase 1/2 clinical study evaluating experimental gene therapy SB-525 in treating patients with severe hemophilia A.

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So what

There are two main reasons why investors are excited about Sangamo's results. First, the initial safety data looked pretty good, with SB-525 generally well-tolerated by patients. Second, the gene therapy demonstrated a dose-dependent relationship in Factor VIII levels.

Hemophilia A is a genetic disorder that leads to a deficiency of the Factor VIII clotting protein. The fact that patients taking higher doses of SB-525 in the clinical study had higher increases in Factor VIII activity is a good sign that Sangamo's gene therapy could be effective in treating the disease.

However, it is still very early. The current study only included eight patients. Barbara Konkle, a professor of medicine at the University of Washington and an investigator with Sangamo's clinical study, noted that "it will be important to observe additional patients and for a longer follow-up duration to determine whether these positive interim findings are recapitulated and sustained."

Although there are more hurdles to jump, today's update was much-needed good news for Sangamo. The biotech reported disappointing results for its gene-editing candidate SB-318 in February after announcing bad news for another gene-editing candidate, SB-913, last September.

Now what

Sangamo and Pfizer now plan to enroll three to five additional patients in the study to receive the highest dose of SB-525. Longer-term data from the study will also be presented at an upcoming scientific meeting.

Edward Connor, Sangamo's chief medical officer, said that the company "look[s] forward to working with Pfizer to potentially advance SB-525 into a registrational study." Before any planning for a pivotal study is started, though, Sangamo and Pfizer will need to make sure the initial data is supported as the current phase 1/2 study continues.

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Keith Speights owns shares of Pfizer. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.