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GW Pharma Drug Trial Disappoints
Marc Jones | Reuters | 03/17/2006

LONDON (Reuters) - GW Pharmaceuticals shares lost a quarter of their value on Friday after the drug firm reported disappointing results from a final-stage trial of its pioneering cannabis-based medicine, Sativex.

It said multiple sclerosis patients with spasticity who used the under-the-tongue spray and stuck to the trial's protocols did benefit. But an "intention to treat" analysis of all study patients -- whether or not they complied -- found no statistically significant advantage compared with a placebo.

The results mean that GW (GWP.L: Quote, Profile, Research) may now delay filing for regulatory approval of the product in Europe.

"We need to pause for breath from a regulatory perspective and decide whether to go full steam ahead with a filing for this indication or whether it makes more sense strategically for us to wait for results of the (neuropathic) pain studies before filing," Managing Director Justin Gover told Reuters.

By 12:20 p.m., GW shares were down 25 percent at a three-month low of 95 pence, valuing the company at around 114 million pounds.

It is likely GW will now wait for results of other Phase III studies assessing Sativex for the relief of neuropathic pain in multiple sclerosis patients.

"Most consistently positive data we have seen previously has been in neuropathic pain, so we are certainly quietly optimistic," said research and development director Stephen Wright.

Two sets of neuropathic pain Phase III results are due to be announced later this year with others due in the middle of next year.

Stockbroker Canaccord Adams said the news was a major setback for the company and downgraded the stock to "hold" from "buy".

"In our view, today's clinical results undermine Sativex's potential utility in the MS (multiple sclerosis) arena," analysts Karl Keegan and Mike Booth said in a note.

Sativex was initially expected to be approved in Britain by the end of 2003, but has suffered numerous delays, with regulators requesting more data to prove its benefits.

GW Pharma 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.

Canada became the first country to approve Sativex for sale in April 2005 as a treatment for neuropathic pain.

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