GW wins okay for pivotal cannabis drug study
January 04, 2006
Ben Hirschler, ReutersGW Pharmaceuticals Plc has won approval from U.S. regulators to conduct a pivotal Phase III study into its cannabis-based medicine Sativex as a treatment for cancer pain, the British drug company said on Wednesday.
GW expects to start testing the product, which is sprayed into the mouth, in U.S. patients with advanced cancer later this year and said it was raising $15 million in a discounted share placing to help fund the trial while it seeks a U.S. partner.
The U.S. randomized clinical trial will involve 250 people and is likely to last between 24 and 36 months, suggesting Sativex will not be ready for launch in the U.S. marketplace until toward the end of the decade.
GW shares, which had risen 7.4 percent on Tuesday on rumors of positive news about Sativex, hit a 20-month high in early trade before retreating to stand 7.5 percent down on the day at 148 pence in late trade.
GW said it had agreed with Polygon Investment Partners of New York to raise 8.6 million pounds ($15 million), or 8.1 million after expenses, by placing 6.2 million new shares at 139.61p each, giving Polygon a 5.4 percent stake in the company.
Canada became the first country in the world to approve Sativex in April 2005 for the relief of neuropathic pain in patients with multiple sclerosis.
GW suffered a setback three weeks ago, however, when a British inquest found the death of a patient taking Sativex in an earlier clinical study was probably linked to the medicine.
Sativex is GW's leading product and the source of most of the company's value.
The group grows thousands of marijuana plants at a secret location in the English countryside, having been granted a dispensation by the government to use the plant for medical research.
STRONGER HAND IN TALKS
Geoffrey Guy, GW's executive chairman, said the acceptance of the Phase III study application by the Food and Drug Administration was a significant achievement for the company that would compress the overall length of time needed to win U.S. approval by avoiding the need for earlier-stage trials.
Having the product in final tests should also strengthen GW's hand in negotiations with potential partners in the United States, where it has yet to sign up a marketing ally.
Germany's Bayer AG is GW's marketing partner in Canada and Britain, while Almirall of Spain recently agreed to market the drug in European countries excluding Britain.
Following the deal with Polygon, GW now has 30 million pounds in the bank, which industry analysts should remove the risk of further fundraising.
Cannabis has a long history of medicinal use dating back to ancient Chinese times. Queen Victoria, whose physician described it as "one of the most valuable medicines we possess", is said to have taken cannabis tincture for her menstrual pains.
It fell out of favor in the 20th century because of a lack of standardized preparations and the development of more potent synthetic painkillers.
GW says it has got round those standardization problems with its spray-based product, which also avoids the damaging effects of smoking the drug.
(Additional reporting by Mark Potter)