Bull Of The Day - GW Pharmaceuticals

And here's the BofA/ML note, reiterating their $218 PT...

GW Pharma also relayed data on rapid and encouraging payer coverage decisions, including over 90 percent of all U.S. lives now covered – 65 percent of which have either Prior Authorization (PA) to indication or less restrictive.

The insurance reimbursement factor is extremely important as doctors may choose Epidiolex for their patients but payers may not have fit cannabinoid medicines into their approved protocols yet. We'll come back to this issue in a moment.

A Cannabis Drug Success 20 Years in the Making

GW Pharma was founded in the UK in 1998 by two physicians, Geoffrey Guy and Brian Whittle. Their mission right from the start was to research and develop cannabinoid medicines, with particular emphasis on ailments of the central nervous system (CNS).

In 2010 they achieved approval in the UK for the first cannabinoid treatment for Multiple Sclerosis. This long track record of success gave US regulators confidence in the science and R&D of GW.

When the FDA approved Epidiolex in June of 2018 for Dravet syndrome, they called it an "important scientific advance." And this paved the way for the US Drug Enforcement Agency (DEA) to move the drug to the safest level in the controlled substance classification system.

This is important because marijuana itself remains a Schedule I drug which means it is classified as having little medicinal value and could be dangerous and/or addictive.

With 3.4 million U.S. patients with epilepsy, including approximately 470,000 children, Dravet syndrome and Lennox-Gastaut syndrome represent two of the most difficult-to-treat epilepsy syndromes.

And Epidiolex, after making a believer out of the FDA and patients in 4 years of clinical trials, is on a mission to educate doctors and families world-wide. Consequently, the first approved cannabinoid medicine is seeing sales estimates rise rapidly as other CNS health indications could be served by the GW pipeline. Some investment bank analysts see sales as high as $750 million for the company in 2020.

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Disclosure: I own GWPH shares for the Zacks Healthcare Innovators portfolio.

Kevin Cook is a Senior Stock Strategist for Zacks Investment Research where he runs the more

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