June 22, 2004
GW Pharmaceuticals, which is trying to make medicine from cannabis extract, saw its shares rise 3 to 133.5p yesterday despite not being able to give a date for the approval of its lead drug, which is aimed at treating multiple sclerosis.
Sativex, the company's cannabis-based sub-lingual spray, is currently with the UK regulators, and the talks have taken longer than originally expected.
Many investors had expected the drug to be launched last year. Geoffrey Guy, the company's executive chairman, acknowledged that the company had initially been over optimistic.
He said that the drug had been with the regulator since last March, and it has not yet been with the regulator for the average amount of time before a drug is approved.
The company also said it made a net loss of £6.9m for the six months to the end of March, compared with £6.7m the previous year. Mr Guy said this was in line with his budget.
However, not all of the analysts who follow the stock were upbeat about Sativex's progress. Karl Keegan from Canaccord noted that the drug regulator might have further questions regarding quality control, safety and efficacy of Sativex and now wants to include data from new Phase III trials into its analysis.
"It adds an as yet undefined delay into our timelines," he said, urging clients to sell the shares.
GW Pharma has not been without its controversies. Angry investors questioned whether the flotation, in 2001, had been overhyped since the share price fell dramatically after the company listed. GW's broker has denied this.
Dr Guy also raised eyebrows for selling £5m of shares at 200p
each last summer before deadlines on the drug approval slipped. He has
said that he hadn't got a problem with this behaviour.
Copyright © 2004, Daily Telegraph