Last week I watched an episode of Netflix’s new informative series Explained, and was introduced to an emerging technology known as CRISPR. Clustered Regularly Interspaced Short Palindromic Repeats (CRISPR) is a developing technology in the medical industry which allows precise modification do genetic sequences [1]. With continued development, CRISPR technology is said to be capable of incredible things such as curing cancer/HIV, preventing disease, or even reviving extinct animals (it’s how scientist plan on bringing back the wooly mammoth) [2] [3]. With all the hype, I decided to analyze gene editing with the failure framework set out in The Innovator’s Dilemma to try and guess if CRISPR will upset the medical industry.
Sustaining versus Disruptive
Christensen’s main point in this section is that sustaining technologies do not often lead to the failure of leading companies, and the biggest metric is that a disruptive technology will provide worse product performance. As most information on CRISPR is speculation, it is hard to determine how this metric will pan out. I doubt however, performance will go down, making it seem CRISPR is better defined as a sustaining technology. Christensen other criteria (having other features that new customers value and being cheaper/simpler/smaller/more convenient) brings the argument back to disruptive, as CRISPR has all of these qualities. As with Ford, the CRISPR innovation has been hailed as the democratization of gene editing [4].
Market Need versus Technology Improvement
Three main companies have been started around CRISPR technology: Intellia, Editas, and CRISPR Therapeutics. Combined, their $4.5 billion worth doesn’t even come close to top pharmaceutical companies [5]. This sets-up the situation described in the graph of this section, particularly if you consider the high end of the market (I would consider this as developed countries healthcare) may not be where CRISPR starts off. CRISPR may be first utilized in preventative medicine, especially amid recent concerns of increased cancer risks or the fear of creating a dystopian society [6].
Rational Investments
Again, without hard information it is difficult to tell whether CRISPR therapies will offer unattractive lower margins, but this is definitely an emerging market. With the wide applications of gene therapy, there is a huge potential market for CRISPR. It is estimated the market of treating disease is currently worth $2 trillion [7]. What’s more, the three CRISPR companies are taking three separate routes into the technology, meaning they won’t be competing with each other directly, similar to the foundation of the cola wars. Finally, as discussed above, there is a chance the medical industry’s most profitable customers will not want CRISPR, particularly before the technology is perfected.
In summary, I strongly believe the emergence of gene editing technology will cause major movements in the medical industry.
[3]http://www.iflscience.com/plants-and-animals/crispr-scientists-bringing-woolly-mammoths-back-dead/
[7]https://www.investors.com/news/technology/crispr-gene-editing-biotech-companies/
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