September 8, 2016
By Mark Terry, BioSpace.com Breaking News Staff
GW Pharmaceuticals ’s jumped from $83.98 yesterday to a current pre-market trading price of $104.03 on rumors it might be acquired. Trading more than doubled normal volume.
GW Pharmaceuticals focuses on developing prescription drugs based on cannabis, i.e., marijuana. To date, it has Sativex, a nasal spray to treat multiple sclerosis (MS) and cancer pain, and Epidiolex to treat childhood epilepsy. Sativex is marketed in 15 countries, including the UK, Spain, Italy, and Germany, but is not yet available in the U.S.
Epidiolex is a liquid formulation of plant-derived Cannabidiol, and has been granted Orphan Drug Designation by the U.S. Food and Drug Administration (FDA) to treat Dravet syndrome and Lennox-Gastaut syndrome, and has Fast Track Designation for Dravet syndrome.
Although GW Pharmaceuticals indicates it is not presently interested in a sale, it has hired investment bank Morgan Stanley to handle any offers. At this point the identity of the potential buyers is not known. However, two major companies with a focus on central nervous system disorders who are likely buyers include Allergan and Biogen .
GW Pharmaceuticals also has a number of partnerships in place with Novartis , Bayer AG and Almirall SA.
Epidiolex is currently in late-stage clinical trials and might be approved by the FDA as early as 2017. Analysts with Cowen & Co. project annual sales could exceed $800 million.
Sativex has been on the market since 2010, but sales have been lower than projected. In the latest quarter, sales were $2 million.
Two other companies that are focused on cannabidiol-based drugs include Insys Therapeutics and Zynerba Pharmaceuticals . Both companies’ stock are on the rise. Insys Therapeutics is headquartered in Phoenix, Arizona. Its is currently trading for $15.71. On July 5, it announced that the FDA had approved its Syndros dronabinol oral solution to treat anorexia associated with weight loss in patients with AIDS, and to treat nausea and vomiting associated with chemotherapy.
Zynerba Pharmaceuticals is headquartered in Devon, Pennsylvania. Company is currently trading for $10.26. The company is currently developing two products, a transdermal synthetic CBD gel for refractory epilepsy, osteoarthritis and Fragile X syndrome, and a synthetic THC pro-drug transdermal patch for two pain indications, fibromyalgia and peripheral neuropathic pain.
TheStreet rated GW Pharmaceuticals stock as a “Sell” with a ratings score of D. “This is driven,” TheStreet writes, “by a few notable weaknesses, which it believes should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks it covers. The company’s weaknesses can be seen in multiple areas, such as its disappointing return on equity, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.”
In addition to its MS and epilepsy drugs, it is working to develop therapeutics for cancer, type 2 diabetes, and schizophrenia.
