- US FDA approves gene edited pigs
- Decision de-risks approval in other territories
- Potential to triple operating profit
Shares in leading global animal genetics company Genus (GNS) surged as much as 395p or 24% to £19.80 on Wednesday (30 April) after the firm announced the landmark US approval of its innovative PRRS (Porcine Reproductive and Respiratory Syndrome) Pig Resistant programme (PRP).
The timing of today’s US FDA (Food and Drug Administration) approval comes earlier than analysts had expected and increases the likely approval in other key US export markets including Mexico, Canada and Japan.
Brazil, Colombia and, more recently, the Dominican Republic have already issued positive determinations for PRP.
Shares in the FTSE 250 company have gained 26% so far in 2025 compared with a 4% decline in the mid-cap index.
WHAT APPROVAL MEAN FOR INVESTORS
PRRS is one of the most devastating global pig diseases and causes suffering and premature death for pigs. Recent research indicates that PRRS also increases the need for antibiotics by more than 200%.
Shore Capital’s Sean Conroy believes the prevention of PRRS virus would be ‘transformational’ for the pork industry as it places a significant burden on producers.
At an investor day in November 2023, Genus showed that PRP could have a material impact on revenue growth and margins, more than tripling operating profit over the next decade.
Analysts at Panmure Liberum described the approval of PRP as a ‘hugely significant landmark. We think the PRP opportunity is worth at least £11 per share, and based on our analysis today’s share price is attaching no material value to it.’
Shore Capital’s Conroy added: ‘Our forecasts haven’t reflected PRP, but we believe this has the potential to accelerate the earnings trajectory beyond FY29F, once the planned royalty-based model for commercialisation begins to meaningfully feed through.’
Based on upside scenarios for the US, Conroy sees potential for PRP to add up to 750p per share to his estimate of fair value for the shares.
