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Sales up but profits down at GW Pharma

UK News | November 29, 2012


Selina McKee

Sales up but profits down at GW Pharma

GW Pharma has posted a mixed bag of results for the year, but continues to show promise in its R&D pipeline with encouraging data for a mid-stage, cannaboid-based diabetes drug.

The company saw its sales for the year ended September 30, 2012, rise £3.5 million to hit £33.1 million, driven by increased milestone income and increased R&D fees from its development partners for flagship drug Sativex (delta-9-tetrahydrocannabinol and cannabidiol).

Milestone income came in at £9.8 million compared with £5.3 million in 2011, as a direct result of amending the license agreement with Almirall regarding the supply of Sativex, the firm said.

On the downside, sales of Sativex (which are based on the volume of vials delivered to the firm's commercial partners) fell to £2.5 million from £4.4 million a year ago, placing a drag on net profits (before tax), which fell from £2.5 million to £1.2 million.

GW maintains that it has made "strong progress in 2012" and is pleased with the growth of Sativex in-market sales.

However, it also noted its time in the red is expected to run through 2013 at least, as it continues to invest in its pipeline in the absence of significant milestone receipts during the year.

"This is consistent with market expectations and is in accordance with our strategic plan to create long-term value from our pipeline by investing in R&D," the firm said.

Mike Aitkenhead, analyst at Edison Investment Research, said: "continued progress in GW Pharma's commercial and R&D activities underpin another solid set of full-year results," and he stressed that positive Phase II results for a novel cannabinoid in diabetes "should, we hope, focus investor attention on GW's promising R&D portfolio". 

New diabetes candidate

The Phase II data unveiled by GW alongside its financial results indicate that the drug, referred to as GWP42004, could be a potential new oral treatment for type ii diabetes, the first said.

"Even in small numbers of patients GWP42004 shows consistent evidence of antidiabetic effects," said lead trial investigator Garry Tan, consultant physician at NIHR Biomedical Research Center in the Oxford Centre for Diabetes, Endocrinology and Metabolism, and noted that the data "clearly support advancing [the drug] into further clinical development".

Among the statistically significant results, the drug was shown to: reduce fasting plasma glucose, with an increase in fasting insulin; improve pancreatic beta cell function; and reduce systolic blood pressure.


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