GW Pharmaceuticals’ share price plummeted by as much as 16% during morning trading on the London Stock Exchange to a new 52-week low today after the firm’s fears were confirmed and it lost an appeal against a ruling from the UK advisory body, the Committee on the Safety of Medicines, that a further clinical study would be required before its cannabis-derived medicine, Sativex (tetrahydrocannabinol plus cannabidiol), could win approval.

GW launched an appeal after the regulators said that a further trial in multiple sclerosis spasticity would be required before a product license for Sativex in the treatment of MS-related pain could be granted [[06/12/04e]]. The CSM had confirmed that there were no quality or safety issues that would prevent the product’s approval, but has now determined that the evidence of Sativex' efficacy in MS spasticity "is not yet sufficiently compelling".

GW has already started a 280-patient study in MS spasticity, but results are not expected until next spring, further delaying the product’s potential market introduction. The firm had originally hoped to win the UK green light before the end of 2003, but has suffered a string of delays [[03/12/03g]]. Sativex has received regulatory approval in Canada in the treatment of neuropathic pain in MS and a launch is expected to take place shortly [[20/04/05d]]. The firm is also progressing its research programme for Sativex in a range of other indications and is planning to start two trials in neuropathic pain in support of a future regulatory filing, while an additional cancer pain study is also in the pipeline, which would be included in a registration package for this indication.

Dr Geoffrey Guy, GW's executive chairman, said that the company was disappointed, but remained defiant. “Our view, which is shared by prominent experts in the field, is that the existing clinical data shows that Sativex provides an important new treatment option for patients with MS,” he explained, adding: “Today’s setback will only serve to reinforce our determination to bring this important and innovative new medicine to the UK market.”

GW claims that it remains in a strong financial position, with net cash balances of £16.2 million at end of May 2005. However, Industry reports are speculating whether the firm will have to embark on a fundraising round in order to bolster its coffers. According to an analyst cited by Reuters, GW will no longer be entitled to a £14 million payment from partner Bayer, which is contingent on the UK thumbs up [[21/05/03b]], [[07/11/03c]].