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Pharmaceutical industry

GW Pharmaceuticals Secures $8.6m Deal to Advance Cannabis-Based Drug in US

Strategic Insights

— 2 min read

GW Pharmaceuticals has secured an $8.6m deal with a US investor, Polygon Investment Partners, to advance its pioneering cannabis-based drug Sativex in the United States. The deal will enable GW to develop Sativex in the US, with the company hoping to file for approval in two or three years' time. The Phase III trial, which has been given the green light by the US Food and Drug Administration, will involve 250 patients and is expected to start in the second half of the year. The trial is the final stage required to file for approval of the drug.

Key Takeaways:

  • GW Pharmaceuticals will raise $8.6m by issuing 6.2 million new shares at 139.61p apiece to Polygon Investment Partners, a New York-based fund manager.
  • The company has won approval from the US Food and Drug Administration to conduct a Phase III trial of Sativex, which will involve 250 patients.
  • The Phase III trial will cost $15m, but additional research will take the total US cost to over $20m, according to Justin Gover, GW's managing director.
  • The newly raised funds will enable GW to begin testing Sativex in the US without pressure to find a partner quickly.
  • The company has started looking for a licensing partner to shoulder most of the US development costs.
  • Sativex is already sold in Canada to treat nerve pain associated with multiple sclerosis, but the US tests will focus on its use as a treatment for pain in terminally ill cancer patients.
  • GW has partnered with Almirall for European markets excluding the UK and with Bayer for Canada and Britain.
  • The company recently suffered a setback when Sativex was linked to a rare illness that killed a pensioner suffering from severe diabetes, but Mr. Gover said the case occurred in 2003 and did not raise safety concerns.

Statistics:

  • $8.6m: the amount of funding GW Pharmaceuticals will raise through the deal with Polygon Investment Partners.
  • 6.2 million: the number of new shares that will be issued as part of the deal.
  • 139.61p: the price per share at which the new shares will be issued.
  • $15m: the cost of the Phase III trial of Sativex.
  • $20m: the total expected US cost of the trial, including additional research.
  • 250: the number of patients involved in the Phase III trial.
  • 2-3 years: the timeframe in which GW hopes to file for approval of Sativex in the US.
  • 2003: the year in which a rare illness linked to Sativex occurred, according to Justin Gover.

Sources:

  • "GW Pharmaceuticals clinched a deal with a US investor yesterday to raise pounds 8.6m, which will enable the fledgling biotech company to develop its pioneering cannabis-based drug Sativex in the United States" (Byline: Julia Kollewe)
  • "The company also announced it had won the go-ahead from the US Food and Drug Administration for a Phase III trial with 250 patients" (Julia Kollewe)
  • "The trials will cost $15m (pounds 8.5m) but additional research will take the total US cost to more than $20m" (Justin Gover, GW's managing director)
  • "Sativex, a mouth spray, is already sold in Canada to treat nerve pain associated with multiple sclerosis, but the US tests will focus on its use as a treatment for pain in terminally ill cancer patients" (Julia Kollewe)
  • "The company recently won Spain's Almirall as a marketing partner for European countries excluding the UK, while the German drug maker Bayer is GW's marketing partner in Canada and Britain" (Julia Kollewe)
  • "GW suffered a setback recently when Sativex was linked to the development of an illness that killed a pensioner suffering from severe diabetes" (Julia Kollewe)

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