Cannabis stock GW Pharma (GWPH) has announced that the US Food and Drug Administration (FDA) has approved Epidiolex oral solution for the treatment of seizures associated with tuberous sclerosis complex (TSC) in patients one year of age and older.
This is a rare genetic disease that causes non-cancerous tumors to grow in the brain and other parts of the body like the eyes, heart, kidneys, lungs, and skin. TSC affects about 1 in 6,000 people.
Epidiolex (cannabidiol) was previously approved for the treatment of seizures associated with two rare and severe forms of epilepsy, Lennox-Gastaut syndrome (LGS) and Dravet syndrome (DS).
This is the only FDA-approved drug that contains a purified drug substance derived from cannabis. It is also the second FDA approval of a drug for the treatment of seizures associated with TSC.
Cannabidiol, or CBD, is a chemical component of the Cannabis sativa plant. However, CBD does not cause intoxication or euphoria that comes from tetrahydrocannabinol (THC). Indeed, it is THC that is the primary psychoactive component of cannabis.
Epidiolex’s effectiveness for TSC-associated seizures was established in a randomized, double-blind, placebo-controlled trial where 148 patients out of 224 received Epidiolex. Patients treated with Epidiolex had a significantly greater reduction in the frequency of seizures during the 16-week treatment period than patients who received placebo.
The most common side effects in Epidiolex-treated patients were: diarrhea, elevated liver enzymes, decreased appetite, sleepiness, fever, and vomiting. The FDA had granted Priority Review designation for this application.
Shares in GWPH have surged 22% year-to-date, and analysts have a bullish Strong Buy consensus on the stock’s outlook. That’s with an average analyst price target of $175 for upside potential of 37%. (See GWPH stock analysis on TipRanks).
“Our Outperform thesis is based on our view that the potential for Epidiolex use in multiple seizure types including those associated with tuberous sclerosis complex are not fully reflected in the stock at current levels” comments Oppenheimer analyst Francois Brisebois.
He has a $166 price target on the stock writing, “We see upside potential with large other refractory epilectics not currently accounted for.”
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