GW Pharmaceuticals PLC- ADR GWPH exceeded fourth-quarter estimates for Epidiolex sales, notching $108 million in revenue for the CBD drug, according to the company’s preliminary figures.
The earnings preview triggered a brief run in the stock this week — one bulls hope to sustain after six months of declines.
The GW Pharma Analyst
Bank of America Securities analyst Tazeen Ahmad maintained a Buy rating on GW Pharma with a $224 price objective.
The GW Pharma Thesis
In meetings this week, GW management assured Bank of America of a positive sales trajectory for its lead drug, Epidolex, Ahmad said in a Thursday note. (See her track record here.)
BofA anticipates $475 million in 2020 sales.
“We note that patients’ access to Epidiolex continues to look positive with 97% of all U.S. insured patients with coverage of Epidiolex in LGS/DS [Lennox-Gastaut and Dravet syndromes],” the analyst said.
The market for LGS and DS is expected to expand into the European Union this year with a planned launch in the U.K. and negotiations advancing in Spain and Italy, she said.
Additionally, GW is poised to penetrate a new domestic market with its application to treat tuberous sclerosis complex — a disease estimated to affect between 40,000 and 80,000 Americans, Ahmad said.
Studies of nabiximols for multiple sclerosis are expected to begin this year, and results from a trial of CBDV for autism are slated for release.
“We currently don’t assign standalone value for autism in our model,” the analyst said. “Positive data therefore in our view could provide upside potential near term.”
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