GWPH Explodes 21% As Epidiolex Roars Back Through The Pandemic

support@smarteranalyst.com (Ben Mahaney)
·2 min read

Shares in GW Pharmaceuticals (GWPH) surged 21% in Tuesday’s trading, after the cannabis biopharma reported beats all round on the back of strong Epidiolex sales.

Epidiolex (cannabidiol) oral solution has now been approved for the treatment of seizures associated with Lennox-Gastaut syndrome (LGS), Dravet syndrome, or tuberous sclerosis complex (TSC) in patients one year of age and older.

Specifically, Q3 GAAP EPS of -$0.03 beat Street expectations by $0.02 while revenue of $137.05M topped consensus by $11.08M. The revenue also represented impressive year-over-year growth of 50.7%, with total Q3 net product sales of Epidiolex of $132.6M.

“We are pleased to report strong revenue growth in the 3rd quarter despite the challenges presented by COVID-19. Epidiolex meets a serious unmet need within the field of epilepsy and we expect the product to demonstrate continued strong growth in the months and years ahead” stated Justin Gover, GW’s CEO. “The recent expanded indication for the treatment of seizures associated with TSC has been very well received by patients, clinicians and payers,” he added.

The company has now commenced the pivotal Phase 3 program for nabiximols in the treatment of multiple sclerosis spasticity, which it says provides multiple opportunities for an NDA submission, including as early as next year.

Beyond nabiximols, GWPH is also advancing several clinical-stage pipeline candidates, including the recent start of a Phase 2 trial in schizophrenia.

Shares in GWPH are up 4% year-to-date, and analysts have a bullish Strong Buy consensus on the stock’s outlook. That’s with 8 buy ratings, 2 hold ratings and an average analyst price target of $173 for upside potential of 60%.

“This 51% year-over-year [revenue] increase is particularly impressive during COVID-19 and is a testament to strong execution, in our opinion… We were particularly encouraged by GWPH’s quick capture of ~10% market penetration [in TSC] with only 1 true month of launch with payer coverage in 3Q20” comments Oppenheimer analyst Francois Brisebois.

He has a $183 price target on the stock writing, “Although very little value if any has been given to GWPH’s pipeline, we were pleased to learn that GWPH had just initiated one of their pivotal P3s of Nabiximols for MS spasticity.” (See GWPH stock analysis on TipRanks).

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