Google Jumps Into Gene Editing: 5 Things You Need To Know

Google makes so many side bets that it named its holding company Alphabet (NASDAQ:GOOGL)(NASDAQ:GOOG) to remind investors that bold and risky investments are going to be a constant theme. One of Alphabet's newest bets is a gene-editing start-up, Verve Therapeutics, and it's teaming up with Google's long-running life science venture, Verily.

Waltzing into the highly regulated drug development arena is extremely bold, and probably a lot riskier than anyone signing the checks realizes. Here are five things you need to know about Google's plans to develop a gene therapy that prevents the leading cause of death for men and women in the U.S.

1. Google's aiming big

In May, Google's venture fund, GV, teamed up with three other funds to launch Verve Therapeutics with $58.5 million in Series A funding. Gene therapies are difficult to manufacture and dangerous to administer. For these reasons, biopharmaceutical companies that develop them have always aimed at life-threatening rare diseases. Verve's turning a lot of heads because it's heading in the opposite direction.

Verve's mission is to protect against heart disease, which is responsible for one in four deaths in the U.S. The start-up biotech will begin by developing a gene therapy that should dramatically lower circulating levels of bad cholesterol for life following a single administration.

While the attempt is a noble one, asking patients who are relatively healthy to accept treatment with a gene therapy seems like a nonstarter for insurers and patients. That's partly because all of today's gene therapies use nonreplicating viruses to deliver their payload, which can be a little unpredictable and occasionally dangerous.

2. Verve will use Verily's repurposed nanoparticles

Google's life science subsidiary, Verily, began working with nanoparticles years ago. The original intent was to create particles that would embed themselves in specific tissues where they would later be monitored by a body-worn device.

Verily plowed resources into developing nanoparticles that could be used to target specific cells, but hit a wall because all the commercially available particles available at the time were essentially useless. As a result, Verily stepped back to develop its own library of nanoparticles, and claims to have a discovery platform of its own now.

Verily has been tasked with developing the first nanoparticle vehicle that can deliver Verve's gene therapy to specific cells in the liver. While this approach makes sense in theory, we still don't know if it's going to work for real people.

3. Don't hold your breath

Now that Verve has some capital to work with, you might be expecting a new drug to emerge from this well-funded bet before you have enough time to forget about it. Although Verve Therapeutics hit the ground running in early May, it's going to be a long time before there's any significant progress to report.

Verve and Verily are just beginning a long journey with unpredictable timelines. Verve has already validated the efficacy of gene-editing approaches, including CRISPR, to safely reduce cholesterol in the lab but the company doesn't have a specific new drug candidate in preclinical-stage development yet. If Verily has successfully used its nanoparticle delivery system, it hasn't told anybody.

Since both companies have little more than a rough outline of what they'd like to do, it's going to be at least another year before anyone can predict when human studies might begin.

4. This can get expensive

Employees capable of validating the efficacy of gene-editing approaches in a petri dish don't work for peanuts and drug development expenses that start off as significant grow exponentially with each step forward. The Food and Drug Administration (FDA) insists on lengthy preclinical studies with animal models before allowing human trials.

Once studies go clinical, paying healthcare professionals and independent data monitors to keep track of every patient can get really expensive. A recent study that added up research and development (R&D) expenses associated with 106 drugs from 10 different companies found the average capitalized cost for each successful approval worked out to around $2.6 billion. This is why it isn't unusual for biopharmaceutical start-ups to lose over $1 billion without anything to show for it.

Alphabet spent $22.4 billion on R&D over the past year, so pumping more money into Verve as the bills pile up probably won't be a problem.

5. Selling gene therapies is hard

If Verve becomes one of few biopharmaceutical start-ups to earn approval for a new gene therapy that works swimmingly during clinical trials, it's still only halfway there. Previous gene therapy launches have fizzled despite clear signs of efficacy that were supposed to drive 10-figure sales.

In 2012, the first gene therapy earned approval in Europe, but Glybera was such a commercial failure that UniCure has already pulled it from the market. More recently, the FDA granted its first gene therapy approval to Luxturna, a treatment for a rare genetic cause of blindness. Luxturna's done a lot better than Glybera, but sales of the younger gene therapy reached just $27 million last year.

There is an extremely slim chance that Verve Therapeutics and Verily will succeed where others have failed, but jumping into gene editing probably wasn't the most thought-out bet that Google's ever placed.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Cory Renauer owns shares of Alphabet (A shares) and Alphabet (C shares). The Motley Fool owns shares of and recommends Alphabet (A shares) and Alphabet (C shares). The Motley Fool has a disclosure policy.

This article originally appeared in The Motley Fool.