Markets

Why GW Pharmaceuticals Stock Is Up Today

What happened?

Shares of GW Pharmaceuticals (NASDAQ: GWPH) are up by 4.8% as of 3:18 p.m. EDT on Monday, after rising by as much as 5.5% earlier in the day. The catalyst for these nice gains is the fact that the U.S. Food and Drug Administration (FDA) approved GW Pharma's Epidiolex for the treatment of seizures associated with tuberous sclerosis complex (TSC).

So what

Back in June of 2018, Epidiolex was approved for the treatment of seizures associated with Lennox-Gastaut syndrome (LGS) and Dravet syndrome, thus becoming the first cannabis-derived drug to be approved by the FDA. And although Epidiolex had a successful first year (or so) on the market, the drug's quarter-over-quarter sales growth has been slowing noticeably. Thanks to this new indication, Epidiolex's sales growth will likely increase in the coming quarters.

Two cannabis leaves on top of a $100 bill

Image source: Getty Images.

GW Pharma estimates that there are between 40,000 and 50,000 TSC patients in the U.S. (and between 1 million and 2 million worldwide), more than 90% of whom suffer from seizures. Further, the cannabis company argues that more than 60% of these patients do not achieve seizure control with alternative therapies. In other words, there's an unmet need within this market, and Epidiolex could be the answer. The drug could generate several hundred million dollars in sales within this indication alone. 

Now what

With today's gains, GW Pharma's stock is up by almost 28% year to date. The company could continue to outperform the market, especially if the launch of Epidiolex as a treatment for seizures associated with TSC is as successful as its initial launch was. In short, now may be a good time to consider buying shares of GW Pharma.

10 stocks we like better than GW Pharmaceuticals
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and GW Pharmaceuticals wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks

 

*Stock Advisor returns as of June 2, 2020

 

Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest Markets Videos

The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More