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The U.S. Food and Drug Administration (FDA) approved the chimeric antigen receptor T-cell (CAR-T) therapy, a new therapy for a type of lymphoma, developed by Gilead Science’s acquired unit Kite Pharma. This marks the second approval for the potentially groundbreaking approach to fighting cancer after FDA approved Novartis’ Kymriah in August.

Gilead Sciences acquired Kite Pharma for $11.9 billion in August, which it completed on October 3.

“The acquisition of Kite establishes Gilead as a leader in cellular therapy and provides a foundation from which to drive continued innovation for people with advanced cancers,” GILD CEO, John F. Milligan, Ph.D., said in a statement.

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Lymphoma Cancer Therapy Drug

The drug, which is called Yescarta (axicabtagene ciloleucel), would be used to treat adult patients with certain types of large B-cell lymphoma, a type of non-Hodgkin lymphoma, who have not responded to or who have relapsed after at least two other kinds of cure.

The treatment involves re-engineering the immune cells of the patients to become cancer killers. The immune T-cells are extracted from patients, genetically fiddled to home in on an destroy cancerous cells, multiplied in a lab, and then jolted back into the patient’s body within about two weeks.

The biopharmaceutical giant said the list price for Yescarta, which is to be administered just once to each patient, would $373,000.

The price is well below that of the first drug before Yescarta, which is Novartis’ $475,000 Kymriah.  It is a gene treatment for B-cell acute lymphoblastic leukemia, the most common form of childhood cancer in the United States.

A spokesperson of the company said that the price was set following extensive research with both government agencies that reimburse for drug costs and private insurers, and cancer centers.

According to Gilead, about 7,500 lymphoma patients each year in the United States would be qualified for CAR-T treatment.

“Gene therapy has gone from being a promising concept to a practical solution to deadly and largely untreatable forms of cancer,” FDA Commissioner, Scott Gottlieb, said in a statement.

In a clinical trial of more than 100 adults, 51% of patients treated with Yescarta achieved complete remission, far higher than what is normal with present standard-of-care treatments.

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Gilead Market Performance

After the FDA’s approval of Yescarta, shares of Gilead Sciences were already sending forward with nearly 2% in gains in morning pre-market trading on Thursday.

The market capitalization of Gilead is currently reeling at 104.65B based on its aggregate value over its current share price and the total amount of outstanding stocks.

The company’s P/E ratio is presently valued at 8.68, with a forward P/E of 10.79.

Its current share price is valued at $81.75 with a change in the price of 2.17%. It has a target price of $84.35.

Michael Yee, a Jefferies analyst, said Yescarta could generate sales up to $250 million in 2018.

Innovative Disease Treatment

Another kind of gene treatment from Spark Therapeutics to cure a rare inherited form of blindness by repairing the havoc wreaked by defective genes is likely to be granted approval by the end of 2017, marking this year a breakthrough for treatments that control the body’s own biological mechanisms in unique innovative ways to fight lethal diseases.

Similar CAR-T therapies are being developed by Juno Therapeutics Inc., Bluebird Bio Inc., and others.

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