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Shares Of This CBD Oil-Selling Biotech Crashed Despite Quarterly Beat
Shares Of This CBD Oil-Selling Biotech Crashed Despite Quarterly Beat
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ALLISON GATLIN5:07 PM ET
GW Pharmaceuticals stock crashed late Tuesday despite better-than-expected sales of its seizure treatment, a CBD oil dubbed Epidiolex.
In after-hours trading on the stock market today, shares of GW Pharmaceuticals (GWPH) tumbled 10.2%, near 121, in average volume. GW Pharmaceuticals stock lost 1% at the close, ending the regular session at 134.75.
The biotech company makes Epidiolex, the only Food and Drug Administration-approved drug derived directly from the cannabis plant. Epidiolex contains cannabidiol, or CBD, an ingredient of cannabis. Unlike tetrahydrocannabinol, or THC, CBD is non-psychoactive.
During the third quarter ended Sept. 30, the CBD oil brought in $86.1 million in sales. Third-quarter revenue of $91 million grew from $2.4 million in the year-ago period. That easily topped the forecast of analysts polled by Zacks Investment Research for $87 million.
"Receptivity to the introduction of this breakthrough treatment continues to be highly encouraging as a result of positive physician and patient experiences as well as strong payer coverage," Chief Executive Justin Gover said in a written statement.
CBD Oil Sales Grow To $188 Million
On a year-to-date basis, Epidiolex has generated $188 million in sales, the biotech company said in a news release. So far, more than 15,000 patients in the U.S. have been prescribed Epidiolex to help them control forms of seizures.
More than 3,000 physicians have prescribed the CBD oil since its launch. Roughly 93% of commercial, Medicaid and Medicare patients receive insurance coverage for Epidiolex.
Outside the U.S., Epidiolex recently gained approval under the slightly altered brand name Epidyolex. Now, the biotech company is launching the drug in France and Germany. The U.K. is expected to weigh in on the drug's cost effectiveness in the fourth quarter.
The biotech company also plans to launch Epidyolex in Spain and Italy in 2020.
Biotech Company Tests Additional Uses
Importantly, GW Pharmaceuticals is working to expand the uses for its CBD oil. Next month, the biotech company will unveil the results of an Epidiolex study in patients with tuberous sclerosis complex. In this genetic disorder, benign tumors grow throughout the body.
GW Pharmaceuticals is also recruiting patients with Rett syndrome for another study. Rett syndrome is a neurological disorder that mostly affects girls.
Also during the quarter, GW Pharmaceuticals reported a net loss of $13.8 million, a decline from a $79.9 million net loss in the year-earlier quarter.