Why GW Pharmaceuticals Stock Is Shrugging Off the Brexit Sell-Off
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What: While the broader markets are heading south today on the Brexit vote, shares of GW Pharmaceuticals gained as much as 12.4% on a positive clinical update for its marijuana-derived epilepsy medicine Epidiolex. Specifically, the company reported that Epidiolex-treated patients suffering from a rare form of childhood epilepsy known asLennox-Gastaut syndrome (LGS) experienced a significant reduction indrop seizure rate compared to those receiving a placebo.
So what:Epidiolex has now hit the mark in two late-stage studies, with the drug meeting its primary endpoint in another pivotal trial last Marchfor Dravet syndrome, a severe form of epilepsy that presents in early childhood. The broader issue at play is that clinical evidence actually supporting the use of marijuana-based medicines has been sparse so far due to the drug's Schedule I status. So, GW's late-stage successes for Epidiolex are in many ways breaking new ground.
Now what: GW is presently conducting a second late-stage study for Epidiolex in LGS that's expected to produce top-line results by the third quarter of 2016. As such, the company could file for the drug's regulatory approval for hard-to-treat childhoodepilepsies perhaps as early as the first quarter of 2017.
While that's all well and good, it's next to impossible to predict how the FDA is going to handle a regulating filing for a marijuana-derived medicine. After all, the agency has little real-life experience with these types of pharma products, and the debate over the medical benefits of marijuana -- or its derivatives -- is far from resolved. I think GW's stock is still trading almost purely on speculation, meaning that investors may want to stick to the sidelines with this high-flying marijuana stock for the moment.
The article Why GW Pharmaceuticals Stock Is Shrugging Off the Brexit Sell-Off originally appeared on Fool.com.
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