Shares of GW Pharmaceuticals PLC- ADR (NASDAQ: GWPH) were halted Thursday, ahead of a Food and Drug Administration vote on the company’s cannabis-derived drug Epidiolex. Trading resumed after the FDA advisory panel voted unanimously in favor of approving the medicine for the treatment of two rare childhood-onset forms of epilepsy that are commonly treatment-resistant.
The vote is non-binding and a final decision is expected by June 27, but it is customary for the FDA to act on its advisors’ recommendations.
While the cannabis plant is used to produce Epidiolex, the medicine is derived from CBD, a non-psychoactive component found in marijuana that is legal in all 50 states and contains less than 0.1-percent THC — the psychoactive component in weed that makes users feel “high.”
GW Pharmaceuticals offered “substantial evidence” to back Epidiolex’s effectiveness, according to the FDA panel’s report. While the drug carries a risk of liver injury, the side effects can be managed fairly well, the report said.
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Shares of GW Pharmaceuticals did not surge much on the news, as the market had already anticipated a decision and traded on speculation, with the stock gaining more than 5.6 percent since Monday.
Experts: Panel Vote A Milestone Moment
The committee’s recommendation of approval for Epidiolex for epilepsy treatment on Thursday is “another step closer to full FDA approval,” Debra Borchardt, CEO at cannabis-focused financial media outlet Green Market Report, told Benzinga.
“Once that happens, it makes it harder for Congress to continue to list cannabis as a Schedule I controlled substance. If the FDA makes it clear that a cannabis-based pharmaceutical drug has medicinal value, then Congress can no longer claim there is no medicinal quality for cannabis.”
The favorable comments serve as “fundamental evidence” of the cannabis plant’s medical efficacy — as well as the investment opportunity surrounding the research and development of similar pharmaceutical products, said Harrison Phillips, vice president at Viridian Capital Advisors.
Vridian expects to see additional cannabis-cased drug candidates introduced by companies for a variety of indications, Phillips said.
“Furthermore, the acknowledgement by the FDA of cannabis’ potential medical efficacy is likely to rekindle debates as to the proper classification of cannabis, and particularly cannabidiol (CBD), the main active ingredient in GW’s product, under the Controlled Substances Act.”
Aras Azadian, CEO at AviCanna, the first cannabinoid therapeutics company to be admitted into Johnson & Johnson (NYSE: JNJ) Innovation’s JLABS @ Toronto, also seemed to agree with fellow cannabis experts.
“It’s an incredible signal and further validation of the future potential of cannabinoid based therapeutics,” Azadian said of the FDA panel vote.
“Having unanimous support [from] the FDA advisory board of evidence-based cannabidiol drugs further motivates and validates the models of companies such as AviCanna and its partners to pursue clinical development of [their] intellectual property,” Azadian said.
Finally, Benzinga reached out to Matt Karnes, founder and managing partner at GreenWave Advisors.
“While the consensus view is that FDA approval will occur, the impact such a decision will have on current DEA scheduling remains in question,” Karnes said. “Regardless, an FDA approval coupled with other positive news flow — including word from the Trump administration that it will not interefere with state-regulated marijuana markets — reduces an element of risk associated with cannabis investing,” he said.
Picture by Javier Hasse.
Related Link: Why GW Pharma’s Epidiolex Results Could Shape The Future Of Cannabis-Based Therapeutics
© 2018 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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