GW Pharma (GWPH) has the distinction of having the first cannabis-derived prescription drug that was approved by the FDA: Epidiolex. This drug is available with a prescription and is coming available at local drug stores. It targets certain types of extremely rare epilepsies. The results are very promising.
It is important to note that the active ingredient within this drug is CBD. But, this is a pharma-quality CBD instead of a standard CBD oil available online and in various forms. CBD is now legalized under certain restrictions under the 2018 Farm Bill that was recently passed. This law will help pave the way for GW Pharma’s drug availability throughout the nation and also allows for a process to export the drug to other nations and regions.
There is a lot of room for growth in the drugs that GW Pharma has available. There are reportedly some 60,000 potential customers in the United States and the drugs are expected to be valued at $32,000 per year per patient. Plus, the very same drugs are now being tested on various other forms of epilepsy which would expand GW Pharma’s customer base without taking on any new additional costs; initial research and testing costs, notwithstanding.
Is GW Pharmaceuticals a Good Buy?
I have been quite bullish on GW Pharma for some time. The company now has a pipeline possibility of drugs with the successes of their first drugs. The numbers of individuals who will be able to use the products are quite high. It is reported that some 3.4 million individuals are affected by epilepsy in America alone. Although there is no known cure, these drugs are able to manage the symptoms of epilepsy.
J.P. Morgan analyst Cory Kasimov has upgraded GWPH to a buy. This pushed the price of GWPH higher by several percent on Wednesday, February 20th. (To watch Kasimov’s track record, click here)
Over the course of the next few quarters the financial results of these products are going to start trickling in. While it may take a while for the products to fully be integrated into the market, getting the products to various pharmaceutical companies, and ultimately getting customers to switch to the products versus their current drugs, this is the beginning of that long process.
As I have mentioned, I am bullish on the drugs and GW Pharma. The trials have shown proven results and while the products do not have the same effects with all patients, those that do see positive results have stated that their preference is for the CBD products versus more traditional products.
With some 3.4 million potential patients in America, GW Pharma may have a blockbuster potential on its hands. I am looking for the upcoming financial statements today to see what kind of results the company can expect and what kind of guidance to expect for the future. My expectation is that the guidance will be very positive.
Author’s Disclosure: I am long GW Pharma and will hold this stock for a long-term holding over the course of many years.
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