The Wall Street giant gives a nod to GW Pharmaceuticals
It doesn’t happen too often, but every now and then, some marijuana-related business is recognized on Wall Street. The latest example comes by way of JP Morgan, which has launched coverage of GW Pharmaceuticals and to which it gave an “outperform” rating. GW is behind the revolutionary cannabis-based epilepsy drug, Epidiolex, which received the blessings of the Food and Drug Administration last year. JP Morgan expects that Epidiolex could break $1 billion in annual sales by 2023.
JP Morgan analyst Cory Kasimov will now cover GW and calls it a “clear leader” in cannabinoid science. He set a price target of $134, which is 33% higher than current levels. He explains, “Commercially, we believe that GWPH’s flagship product, Epidiolex (recently approved for several congenital seizure syndromes), is poised for a solid launch in approved indications, while penetration into the broader (and much larger) population of general epilepsy patients could serve as material upside to our current WW peak sales estimates of ~$1.3B. Given our favorable view on Epidiolex’s commercial prospects, a second (possibly underappreciated) revenue driver in Sativex, material news flow (both regulatory and clinical) in 2019, and the ~47% pullback since late Sept, we think GWPH could be a relative outperformer in our universe.”
Kasimov adds that Epidiolex is going to be a permanent leader in the field of epilepsy treatment. He expects that it will quickly be adopted by the medical community and doesn’t anticipate any generic knockoffs to be made available until after 2027. He further states that he has been encouraged by the positive reviews from patients who specifically ask for the medication by name.
