Will Krystal (KRYS) Continue To Shine?

Shares of Krystal Biotech Inc. (KRYS) have now more than doubled in value since touching a 52-week low of $22.02 on June 14, 2019.

Krystal Biotech is a clinical-stage gene therapy company developing topical and intradermal novel treatments for patients suffering from rare dermatological diseases and chronic skin diseases.

We had profiled this Company on June 8, 2018, when it was trading around $12.72 (Report titled In The Spotlight: Krystal Biotech) and had alerted readers to this stock again on December 4, 2018, when it was trading around $24. (Report titled Krystal Is Clearer, Hits New High). The stock now trades around $54.

Krystal has a couple of milestones for the remainder of this year, which may either add more sheen to the stock or dim its luster, depending upon the outcome.

One of the two gene therapies products of the Company in clinical testing is KB105 that is designed to be an off-the-shelf treatment for TGM1-deficient autosomal recessive congenital ichthyosis (ARCI) that can be applied topically, directly to a patient’s skin.

KB105 is under a phase I/II study in adult patients with transglutaminase-1 (TGM1) deficient ARCI, dubbed GEM-3.

TGM1-deficient ARCI is a debilitating rare skin disease characterized by excessive, thick dry scaly skin – with risk for dehydration, sepsis, skin malignancies, etc. There are approximately 23,000 cases of TGM1-deficient ARCI worldwide and about 400 new cases per year globally. There are no approved treatments for ARCI associated with TGM1.

The interim clinical data from the GEM-3 study is scheduled to be presented at the Society for Investigative Dermatology (SID) Annual Meeting next week.

The Company plans to include pediatric patients in the GEM-3 study, following safety review by the FDA.

The most advanced investigational gene therapy in the pipeline is Bercolagene telserpavec or B-Vec for short, (previously KB103), designed to be an off-the-shelf treatment for Dystrophic Epidermolysis Bullosa (DEB) that can be applied topically to a patient’s skin.

Dystrophic epidermolysis bullosa, or DEB, is an incurable, often fatal skin blistering condition caused by a lack of collagen protein in the skin. It is caused by mutations in the gene coding for type VII collagen, or COL7.

There are no approved treatments for DEB. It is estimated that up to 125,000 people worldwide are affected by DEB.

B-Vec has been successfully tested in phase I/II study in DEB, and the final results were announced last October.

The Company remains on track to start the pivotal study of B-Vec in Dystrophic Epidermolysis Bullosa in the first half of 2020, barring any COVID-19 delays.

Also in the pipeline are two gene products in preclinical testing – KB301 for aesthetic skin conditions like fine lines; nasolabial folds; glabellar lines; depressed scars; UV-induced skin damage and KB104 for Netherton Syndrome, a life-threatening condition characterized by red, inflammatory scaling on the face, shoulders, and back, as well as short, brittle, and broken “bamboo hair”.

Krystal is planning to file INDs (Investigational New Drug Applications) for KB104 (Netherton Syndrome) and KB301 (undisclosed aesthetic condition) in the second half of this year.

In addition, the Company is developing KB407, a non-invasive inhaled gene therapy product for the treatment of cystic fibrosis. It is currently in the pre-clinical phase.

A poster titled “In vitro Pharmacology of KB407, an HSV-1 based gene therapy vector, for the treatment of cystic fibrosis” is slated to be presented at the American Society of Gene & Cell Therapy (ASGCT) 23rd Annual Meeting next week.

Cash position:

The Company ended March 31, 2020, with cash, cash equivalents, and short-term investments of $186.7 million.

KRYS has traded in a range of $22.02 to $66.85 in the last 1 year. The stock closed Wednesday’s (May 6, 2020) trading at $54.41, up 3.36%.

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