Prime Therapeutics stock surges 35% on JonesTrading's acquisition optimism.

Prime Therapeutics (NASDAQ:PRME) shares rose by around 35% on Monday following a bullish report from JonesTrading. The report highlighted increased interest in gene editing due to Eli Lilly's recent deal to pay up for a gene editing platform. JonesTrading sees Prime Medicine as a potential acquisition target.

Prime Therapeutics (NASDAQ: PRME) shares rose by around 35% on Monday following a bullish report from JonesTrading. The report highlighted increased interest in gene editing due to Eli Lilly's recent deal to pay up for a gene editing platform. JonesTrading sees Prime Medicine as a potential acquisition target.

The gene editing sector has seen significant momentum, with several acquisitions and increased investor interest. Eli Lilly's recent acquisition of Verve Therapeutics (NASDAQ: VERV) for $1.3 billion has further fueled this interest. Prime Medicine's shares have surged approximately 160% since mid-June, building on momentum that began after a management change on May 19 [2].

Several factors appear to be driving Prime Medicine’s upward trajectory. These include Eli Lilly’s acquisition of Verve Therapeutics, a significant price/valuation discrepancy compared to peers, substantial insider buying of 329,000 shares in the open market since mid-May, and high short interest exceeding 30% of float [2].

Jones Trading analyst Soumit Roy commented on the sector’s outlook: "VERV’s Phase 1b data was sufficient to trigger an M&A, and we believe PRME could get to the same place as they start announcing their clinical data in 2027" [2].

While Prime Medicine has yet to produce clinical data, Lilly’s acquisition of Verve suggests pharmaceutical companies are increasingly interested in gene editing technologies for treating larger market diseases, not just rare conditions with acute unmet needs [2].

Prime Therapeutics appears well-positioned to benefit from the ongoing momentum in the gene editing sector. With substantial cash reserves and a strong pipeline, the company is poised to capitalize on the growing interest in this technology.

References:
[1] https://www.investing.com/news/stock-market-news/prime-medicine-stock-soars-amid-gene-editing-sector-momentum-4125209
[2] https://www.asktraders.com/analysis/summit-therapeutics-stock-smmt-new-bullish-price-target/