Last week, GW Pharmaceuticals (Nasdaq: GWPH) announced they have entered into an agreement with Jazz Pharmaceuticals (Nasdaq: JAZZ) for Jazz to acquire GW Pharma. Both boards of directors for the two companies have approved the deal and they expect the acquisition to close in the second quarter of 2021.
GW Pharma is well-known in the cannabis industry as producing the first and only FDA-approved drug containing CBD, Epidiolex. Epidiolex is approved for the treatment of seizures in rare diseases like severe forms of epilepsy. GW is also currently in phase 3 trials seeking FDA approval for a similar drug, Nabiximols, that treats spasms from conditions like multiple sclerosis and spinal cord injuries.
Jazz Pharmaceuticals is a biopharmaceutical company based in Ireland that is known for its drug Xyrem, which is approved by the FDA to treat narcolepsy.
Bruce Cozadd, chairman and CEO of Jazz, says the acquisition will bring together two companies that have a track record of developing “differentiated therapies,” adding to their portfolio of sleep medicine and their growing oncology business. “We are excited to add GW’s industry-leading cannabinoid platform, innovative pipeline and products, which will strengthen and broaden our neuroscience portfolio, further diversify our revenue and drive sustainable, long-term value creation opportunities,” says Cozadd.
Justin Gover, CEO of GW Pharma, says the two companies share a vision for developing and commercializing innovative medicines, with a focus on neuroscience. “Over the last two decades, GW has built an unparalleled global leadership position in cannabinoid science, including the successful launch of Epidiolex, a breakthrough product within the field of epilepsy, and a diverse and robust neuroscience pipeline,” says Gover. “We believe that Jazz is an ideal growth partner that is committed to supporting our commercial efforts, as well as ongoing clinical and research programs.”
As of this writing, the United States Food and Drug Administration (FDA) has approved GW Pharma’s CBD drug Epidiolex for treating profound refractory pediatric epilepsy syndromes (Dravet syndrome and Lennox Gastaut syndrome) as well as for treating seizures associated with tuberous sclerosis complex (TSC) in patients one year of age or older. The product is a very simple, orally-administered formulation comprised of 100mg/ml cannabidiol (CBD), dehydrated alcohol, sesame seed oil, strawberry flavor and sucralose – basically, an alcohol-based solution with sesame seed oil to help solubilize the CBD oil, flavoring and sweetener.
On April 6th, 2020 GW Pharma performed a regulatory miracle when they succeeded in convincing the Drug Enforcement Administration (DEA) to deschedule Epidiolex (i.e., remove it from the Schedule 1 and Schedule 5 lists of substances that the agency regulates due to concerns regarding safety, potential for abuse or both) for all indications – including indications for which it has not yet been approved by the FDA.1 The benefit to GW of having their product descheduled is incalculable. This status change removed potential barriers to insurance reimbursement and made the need to set up and administer an expensive REMS2 drug safety program less likely. In part because of this regulatory coup d’état, the drug recently posted yearly earnings of nearly $300 million.
It is important to note that the DEA descheduled the Epidiolex formulation and not cannabis-derived CBD itself. Thus, GW Pharma is now in the enviable position of being the only company that can legally sell cannabis-derived CBD. More importantly, because the DEA descheduled the formulation and not the active ingredient, other companies who wish to market cannabis-derived CBD pharmaceutical formulations will have to repeat whatever it is that GW did to get Epidiolex descheduled.3 The DEA effectively gave the company a huge head start with respect to competitors who are developing other cannabis-derived CBD formulations that would compete with Epidiolex. That advantage will remain in place unless and until cannabis-derived CBD itself is descheduled or cannabis is legalized at the federal level.
GW Pharma’s attorneys demonstrated considerable virtuosity in devising this approach. However, there is another aspect of the GW Pharma story – one that could have profound implications for the exploding CBD consumer packaged goods (CPG) industry. The Federal Food, Drug, and Cosmetics Act4 (FFDCA) prohibits the introduction into interstate commerce of any food to which has been added an approved drug or a drug for which substantial clinical investigations have been instituted and made public.5 Because CBD was and is still the subject of clinical trials run by GW Pharma and others, even hemp-derived CBD is currently illegal to use as a food additive or dietary supplement under the FDCA
The FDA has recently re-started the public commentary stage of a long process that will hopefully result in the creation of a regulatory pathway for CBD to be used as a food additive – something that would seemingly be a straightforward matter given the copious amounts of safety data being generated from all of GW Pharma’s clinical trials. However, as long as the FDA continues to drag its feet in providing a regulatory pathway for CBD CPG products, CBD, regardless of its source, will remain illegal to use as a food additive or supplement under either the CSA or the FFDCA despite the existence of safety data obtained through the Epidiolex clinical trials. If, as many people in the industry anticipate, the agency decides to begin enforcement action, this could have a hugely negative impact on the industry.
In addition to the potentially disastrous effect that federal law could have on an important new industry, the federal regulatory scheme introduces unnecessary regulatory complexity and cost by imposing two different regulatory schemes depending on the source of the CBD. CBD derived from hemp is chemically identical to CBD derived from cannabis. Despite that identity, the 2018 Farm Bill nonsensically exempts only hemp-derived CBD from the Controlled Substances Act. If a regulatory pathway is created for hemp-derived CBD, but the DEA insists on maintaining cannabis-derived CBD as a schedule 1 substance, then the same molecule will be subject to two different regulatory schemes. This scenario would require tracking and certifying CBD sources and thereby impose regulatory and economic burdens that are entirely unnecessary from a public health point of view.
An alternative, economically disastrous scenario: given the pharmaceutical industry’s formidable lobbying power, it is entirely possible that the FDA could decide to limit the use of CBD exclusively in prescription drug formulations. This could kill the entire US hemp CBD CPG industry, currently estimated to reach $22 billion by 2022.6
Overall, the current state of affairs is unfair, expensive, uncertain and entirely unworkable over the long term. The CSA must be amended, ideally to deschedule both hemp and cannabis entirely, but at least in the short term, to deschedule CBD and preferably all non-THC cannabinoids regardless of their source. Further, the FDA must provide a regulatory pathway to allow the use of low doses of cannabinoids shown to be safe, either by existing clinical trial data or future testing pursuant to the NDIN submission process.
A 2019 Gallup poll found that 14% of Americans – 1 in 7 – use CBD products.7 The demand is there, the industry is thriving, and adequate safety data exists to justify a regulatory system that allows low-dose over the counter CBD products provided those products are produced using Current Good Manufacturing Practices (CGMPs) for food and dietary supplement manufacturing prescribed by the FDA and that such products undergo regular testing that demonstrates they are safe, unadulterated and accurately labeled. It is time for the industry to collectively fund a New Dietary Ingredient Notification (NDIN) submission that would provide safety data sufficiently compelling to force the FDA to either recognize CBD and other non-THC cannabinoids as being GRAS substances regardless of their source, or in the alternative create a regulatory path for CPG products containing low-doses of CBD and other non-THC cannabinoids.
Editor’s Note: The opinions expressed in this publication are those of its author. They do not purport to reflect the opinions or views of the Cannabis Industry Journal, its editorial staff or its employees.
Clincialtrials.gov lists 256 different clinical trials in which Epidiolex has been, is being or will be tested for a wide variety of other indications, including but not limited to opioid use disorder, several types of prostate cancer, alcohol use disorder, musculoskeletal pain, and a host of others.
REMS – risk evaluation and mitigation strategy – are drug safety programs that the FDA requires in cases where mediations pose serious safety concerns with respect to potential abuse and other adverse effects.
Exactly what they did isn’t clear, and won’t be for a long while given the snail’s pace at which FOIA requests are filled.
Title 21 United States Code Chapter 9
Title 21 United States Cod Chapter 9, Sections 331(ll), 342(a)(1) and Section 342(d)(f)(1)
“Exclusive: New Report Predicts CBD Market Will Hit $22 Billion by 2022” Rolling Stone Magazine, September 11, 2018, citing cannabis industry analysis from the Brightfield Group.
Cannabidiol, or CBD, is one of over 1000 cannabinoids found in the Cannabis plant. CBD was identified as an isolate from Minnesota Hemp in the 1930s (Gururajan, 2016). Unlike many other cannabinoids and compounds found in cannabis flower, CBD is not adversely psychoactive. CBD, upon its discovery entered the field of vision for US regulators. There are two routes of regulation for the FDA under the 1938 Food, Drug, and Cosmetic Act – as a drug and as a food (Oconnor, 2018). The FDA has jurisdiction over drugs in a broad sense from border to border, intra and interstate. Their jurisdiction over food, however, only extends to food that crosses interstate lines. CBD therefore, because of potential food uses and medicinal uses, darkens what is already a muddy regulatory landscape.
CBD as a drug
Under the FD&C Act, a drug is defined as “any product, including a cannabis product (hemp or otherwise), that is marketed with a claim of therapeutic benefit, or with any other disease claim (Mayol, 2019). In 1995, Cannabidiol was identified as a possible solution to help combat epilepsy. Since 1995, studies have been performed to evaluate the effectiveness of CBD to treat epilepsy and lessen the frequency and severity of seizures. In 2018, the FDA approved the first cannabidiol drug, brand named Epidiolex (White, 2019). Drug approvals under the FDA jurisdiction require specific approval before they can be launched into market. That is, while Epidiolex has a specific approval, this approval does not lead to implicit approval of similar CBD drugs that treat other illnesses.
Bottom line: CBD is a recognized drug for use to treat epilepsy. Future use as a drug needs to be approved by the FDA.
CBD as an ingredient
What is seemingly the easiest route to market for CBD derived products is increasingly complicated. For ingredients, the easiest road to allowance in food is to be identified as Generally Recognized as Safe (GRAS). GRAS status is granted to ingredients that have been studied and deemed safe for human consumption by FDA-recognized experts. CBD, to date, is not GRAS. Without GRAS status, the FDA has similar mandates to CBD as a drug above. Ingredients must gain premarket approval prior to being offered for sale in interstate commerce.
Bottom line: CBD is not a recognized ingredient in food – it is neither premarket approved by the FDA nor accepted as generally safe for human consumption.
CBD product offerings continue to rise, ranging from CBD infused pillows to suppositories. While products containing CBD have increased in popularity, the FDA has stood at a distance until recently. The result of this lack of enforced policy has led to a scenario where upwards of 70% of all CBD products available online are mislabeled (Caroon, 2018).
This lack of enforcement and flexing of authority seems to be a thing of the past, however. In late November, the FDA sent a warning letter to 15 facilities that had engaged in interstate commerce with a CBD product. These warnings stemmed largely from non-compliant claims of health benefits, CBD use as a dietary supplement, and CBD used in food products offered for sale across state lines.
Until CBD is either identified as GRAS or a specific product gets preapproval, the current issues with CBD in food will remain. In the meantime, manufacturers must be aware of their ingredients, their claims, and the ramifications these may have on the FDA jurisdiction over their products.
Cohen, P., & Sharfstein, J. (2019). The opportunity of CBD — reforming the law. The New England Journal of Medicine, 381(4), 297-299.
Corroon, J., & Kight, R. (2018). Regulatory status of cannabidiol in the united states: A perspective. Cannabis and Cannabinoid Research, 3(1), 190-194. doi:http://dx.doi.org.ezproxy.neu.edu/10.1089/can.2018.0030
Gururajan, A., & Malone, D. (2016). Does cannabidiol have a role in the treatment of schizophrenia? Schizophrenia Research, 176(2-3), 281-290.
O’Connor, S. and Lietzan, E. (2018). The surprising reach of FDA regulation of cannabis, even after descheduling. American University Law Review 68, 823.
Mayal, S. and Throckmorton, D. (2019). FDA Role in Regulation of Cannabis Products. Retrieved from https://www.fda.gov/media/128156/download
White, C. (2019). A Review of Human Studies Assessing Cannabidiol’s (CBD) Therapeutic Actions and Potential. Journal of Clinical Pharmacology, 59(7), 923-934.
The opening of the UK’s first cannabis clinic is certainly cause for cheer. The effort, backed by a growing UK powerhouse that includes European Cannabis Holdings, has just opened its first private cannabis clinic in the UK, with two more on the way, including one in London by the end of the year.
The clinic will see patients who can afford to pay, in other words those who are privately insured and not covered by the NHS. The clinics will also serve those with chronic illnesses including chronic pain and epilepsy.
This development will also undoubtedly begin to increase the number of actual legal British cannabis patients, which is significant in and of itself. That count now, close to five months after cannabis became technically available via Schedule II prescription last year, is a shocking four patients. This is not a typo.
Presumably, this means that patients who enter the market this way will also be able to access newly imported Dutch cannabis which has just started to enter the country in bulk. Not to mention be able to find pharmacies who stock the drug.
For the backers of ECH (which include SOL Global), these are strategic moves indeed, which also bode well for those who can afford access.
But does this herald a new shift in the way that cannabis will be prescribed for the mainstream in the UK if not across Europe? That is not so clear.
The History of Cannabis Clinics… In Israel and Beyond
From the medical side of the world, it has been cannabis specialty pain clinics that have moved the conversation forward and served patients in places like Israel. In the latter part of the last decade, Israel slowly began to liberalize access not via dispensaries, as in the American model, but rather via specialty pain clinics paid for by the government. It was only when patient attendance at such prescription and dispensation points became flooded by applicants that the government, just a few short years ago, began to allow regular doctors to prescribe the drug and regular pharmacies to carry it.
What does this say about a British market where reform has just come, and only four patients?There are currently various initiatives sprinkled around Europe- mostly in the form of collectives of doctors who try to help get their patients cannabinoid treatments. See, for example, Kalapa Clinic in Spain. Or the “self help” group of patients in Germany loosely associated with Dr. Grotenhermann (one of the country’s best-known cannabinoid doctors).
Yet in Germany, the first country in Europe to liberalize medical use, there are as yet no cannabis clinics of either the private or public kind (although there have also been several unsuccessful attempts to do just this since 2017 in cities like Berlin and Munich). Part of the reason for the failure of the model in Germany at least is due to the fact that while specialty doctors are needed to help guide patients through the complicated approvals process, the payment for the same from the insurance companies (even private insurers) is so low it is not yet economically feasible to set up a clinic based on this model.
That said, it is clearly an idea that has occurred to more than a few entities. In Germany, however, land of (at least) 40,000 patients, this model has yet to take off. What does this say about a British market where reform has just come, and only four patients? Even as early as spring 2017, when the German government changed the law mandating insurance coverage, there were 800 German patients in the system.
Why The UK Is Likely To Be Different
Cannabis patients may actually be some of the best situated patients to ride out the Brexit crisis that will hit all drugs. Why? From the start, the strange classification of the drug is requiring bespoke solutions for niche patients. While it may not be fair, this in turn will at least start to create a core group of medical users.
Creating at least that first critical mass is also unbelievably important for greater access and reform, if not speeding it on its way. And the backers of the new clinics are well aware that impetus on this front will not come from the much-beleaguered NHS but rather private initiatives like the ones now being launched in the UK.
Disclaimer: ECH is a sponsor of the MedPayRx go to market pilot trial.
The majority of this cost will not be picked up by private health insurers but rather the federal governmentActually, according to industry analysis, this is about 70% more than the price of one comparable drug (Onfi), and slightly more expensive than Banzel, the two competing (non-cannabinoid based) medications now available in the U.S. for this market.
Here is the other (widely unreported) kicker. The majority of this cost will not be picked up by private health insurers but rather the federal government, which is also not negotiating with GW Pharma about that high price (unlike for example what is going on in Europe and the German bid).
Why the difference?
Two reasons. The first is that Epidiolex has obtained “orphan drug” status (a medication for a disease that affects fewer than 200,000 patients in the U.S.) The second is that the majority of the insurance that will be picking up this tab is Medicaid. The patient pool will be unable to afford this. As a result, the bulk of the money will remit not from private insurance companies but rather federal taxpayers. And, unlike in say, Germany, none of this is pre-negotiated in bulk.
Co-payments are expected to range from $5 to $200 per month per patient after insurance (read: the government) picks up the tab. This essentially means that the company plans to base participation at first at least on a sliding scale, highly subsidized by a government that has yet to reschedule cannabis from a Schedule I in the U.S.
Creating, in other words, a new monopoly position for GW Pharmaceuticals in North America.
A Hypocrisy Both Patients And The Industry Should Fight
The sordid, underhanded politicking that has created this canna monster is hardly surprising given the current political environment in both the U.S. and the U.K. right now. The people who benefit the most from this development are not patients, or even everyday shareholders, not to mention the burgeoning legitimate North American cannabis industry, but in fact highly placed politicians (like British Prime Minister Theresa May). Philip May, the PM’s husband’s firm is the majority shareholder in GW Pharma. Her former drugs minister (with a strong stand against medical cannabis) is married to the managing director of British Sugar, the company that grows GW Pharma’s cannabis stock domestically.
So far, despite a domestic outcry over this in the UK (including rescheduling), there has been no political backlash in the United States over this announcement. Why not?
Look To Europe For A More Competitive Medical Market
This kind of pricing strategy is also a complete no go in just about every other market – including medical-only markets where GW Pharma already has a footprint.
For example, German health insurers are already complaining about this kind of pricing strategy for cannabis (see the Cannabis Report from one of the country’s largest insurers TK – out earlier this year). And this in an environment where the government, in fact, does negotiate a bulk rate for most of the drugs in the market. Currently most German cannabis patients are being given dronabinol, a synthetic form of THC which costs far less.
On top of this, there are also moves afoot by the German government to begin to bring the costs of medical cannabis and medicines down, dramatically. And this too will impact the market – not only in Europe, but hopefully spark a debate in every country where prices are also too high.
The currently pending German cultivation bid for medical cannabis has already set an informal “reference” price of at most 7 euros a gram (and probably will see bid competitors come in at under half that). In other words, the government wholesale price of raw, unprocessed cannabis flower if not lightly processed cannabis oil is expected to be somewhere in the neighbourhood of 3-4 euros per gram come early next year. If not, as some expect, potentially even lower than that.
Processed Cannabis Medicine vs. Whole Plant Treatment
The debate that is really raging, beyond pricing, is whether unprocessed cannabis and cannabis oil is actually “medicine.” At the moment, the status quo in the U.S. is that it is not.
GW Pharmaceuticals, in other words, a British company importing a CBD-based derivative, is the only real “medical cannabis” company in the country, per the FDA. Everyone else, at least according to this logic, is placed in the “recreational camp.” And further, hampered still, with a lack of rescheduling, that affects everyone.
If that is not an organizing issue for the American cannabis industry, still struggling with the many issues inherent in the status quo (from insurance coverage and banking to national distribution across state lines) leading up to the midterms, nothing will be.
British Home Secretary Sajid Javid appears to have become the most high ranking cannabis advocate in the British government. He has just launched a review into medicinal uses of cannabis in the UK. However, this dramatic change in policy has only come after a series of high profile campaigns and escalating battles for access waged by patients and their families against a government which has remained stubbornly intransigent in the face of growing evidence of medical efficacy and reform elsewhere. In fact, the cannabis “Battle of Britain” has come to resemble the contretemps in Israel over the same issue four years ago that led to a national review of medical use and greater patient access.
It is expected that this recent turn of events will open better access for more British medical users. The fact that the timing of all of this comes as GW Pharma has received the right to distribute Epidiolex in the U.S. as the first FDA-approved cannabis-based medicine is not only part of the irony but the underlying problematic politics surrounding all of this. Starting with the timing of who has access to what, and under what circumstances. As it stands, Epidiolex is also the only cannabis-based drug now eligible in the United States for healthcare coverage. The rest of the market is so-far excluded from it. Unlike, it should be pointed out the situation in the UK, the rest of the Commonwealth, and of course, the EU. Starting with Germany.
A Major Win for Patients
Celebrate one for Alfie! Alfie Dingley that is – the British 6 year old with epilepsy who has become one of the most well-known faces of medical justice for cannabis users in the UK. Dingley and his parents waged a battle since last fall over his right to consume low THC cannabis oil that allows him to manage his epilepsy. He has just been granted an emergency license to import the oil from the Netherlands.
But this is also a victory for Billy Caldwell, the twelve-year-old who ended up in emergency care in hospital recently after his medical oil (from Canada) was confiscated at the border. Video of border control agents at Heathrow Airport removing the oil from the Caldwells caused a national outcry in the UK. Caldwell’s mother, Charlotte, has also waged a high profile battle for access, including at the doors of the hospital her son was admitted to last week. She has also started her own CBD company named after her son.
Like the rest of Europe, which the UK still technically is part of until Brexit, the focus here has very much been on medical use.And of course, this new indication in change of policy is seen as a major victory if not step forward for literally thousands if not millions of Britains who suffer from chronic conditions that are still drug resistant (like Epilepsy but not limited to the same.)
As he addressed the House of Commons on the issue of medicinal cannabis use, Javid said “It has become clear to me since becoming home secretary that the position that we find ourselves in currently is not satisfactory…I have now come to the conclusion that it is time to review the scheduling of cannabis.” As in the US, cannabis is still considered a Schedule I drug in the UK – with supposedly no medical efficacy. This new development clearly challenges that scheduling – but where and how?
Recreational Is Still Not On The Table
Like the rest of Europe, which the UK still technically is part of until Brexit, the focus here has very much been on medical use. This is for several reasons, including a much better and more inclusive public health system – despite imminent fears about the longevity of the British National Health Service (NHS).
In the UK, however, further reform is not likely to move fast. Unlike anywhere else, cannabis production is essentially limited to one company – GW Pharmaceuticals – who themselves have high standing political connections that continue to oppose reform. This is not based on science but rather profit. Despite the fact that the British Isles are the largest exporter of medical cannabinoid pharmaceuticals in the world, British patients are still largely excluded from access. The only reason that these children and their parents were able to pierce the wall of privilege and profit that has driven the debate here since the late 90’s is that GW Pharmaceutical’s cannabinoid concoctions do not work on this kind of epilepsy. Plus the failure of a recent trial of their new drug (shamefully in Europe, not even conducted in the UK).
As a result, GW Pharmaceuticals and the well placed scions of British society who have profited directly and personally from this situation have little choice but to back down – but not by much. As soon as Javid announced his intention to do a review of British policy, former Tory (conservative) leader Lord William Hague called for full legalization. An initiative that as of June 19 was rejected by the government.
Is Medical Finally About To Get Its Due?
In Europe, politically, the frustration is clearly growing. And much like in the United States circa 2012, activists and advocates realize that medical access is the first step towards full reform. However here there is a marked difference to what is going on in both the U.S. and Canada. And in turn, this may bring a long overdue focus on the medical issue that has continually been obscured and overlooked by the industry itself as soon as recreational seems it is in reach.
When real and regulated medical markets are allowed to flourish, the first beneficiaries are both children and women, not middle-aged men. That is clearly the face of the “average” German patient now that the data of the first year has come in. It is also likely to be the case of the British patient as well as Europeans across the continent.In Europe, politically, the frustration is clearly growing
Further, as cannabis has become more of an accepted treatment, this is in turn forcing governments (and even the industry itself) to begin, for the first time, to consider funding widespread trials – and of the raw plant itself along with extracts and other forms the drug can be consumed in.
What does this really herald, in fact then besides relief for chronically ill patients? The first widespread scientific inquiry into the efficacy of cannabinoids outside of Israel.
And that too, is cause for celebration. Congrats Alfie and Billie! And all the people who helped move the issue forward.
According to a press release, the U.S. Food and Drug Administration (FDA) approved GW Pharma’s drug Epidiolex for the treatment of rare forms of epilepsy. Just a few months ago, news broke of a very encouraging FDA panel assessment, which indicated a positive outlook for the drug’s approval.
In the press release, FDA Commissioner Scott Gottlieb, M.D appeared to indicate an open willingness to explore the medical benefits of cannabis. “This approval serves as a reminder that advancing sound development programs that properly evaluate active ingredients contained in marijuana can lead to important medical therapies,” says Gottlieb. “And, the FDA is committed to this kind of careful scientific research and drug development.” He went on to add:
Controlled clinical trials testing the safety and efficacy of a drug, along with careful review through the FDA’s drug approval process, is the most appropriate way to bring marijuana-derived treatments to patients. Because of the adequate and well-controlled clinical studies that supported this approval, prescribers can have confidence in the drug’s uniform strength and consistent delivery that support appropriate dosing needed for treating patients with these complex and serious epilepsy syndromes. We’ll continue to support rigorous scientific research on the potential medical uses of marijuana-derived products and work with product developers who are interested in bringing patients safe and effective, high quality products. But, at the same time, we are prepared to take action when we see the illegal marketing of CBD-containing products with serious, unproven medical claims. Marketing unapproved products, with uncertain dosages and formulations can keep patients from accessing appropriate, recognized therapies to treat serious and even fatal diseases.
According to the press release, the drug was studied in three randomized, double-blind, placebo-controlled clinical trials with 516 patients who have either Lennox-Gastaut syndrome or Dravet syndrome, the two rare forms of epilepsy the drug is now approved to treat. Epidiolex is an anti-epilepsy drug, taken in a syrup form, with the main active ingredient being cannabidiol (CBD), and less than 0.1 % THC.
Techniker Krankenkassen (or TK as it is also frequently referred to) is one of Germany’s largest public or so-called “statutory” health insurance companies. It is companies like TK that provide health insurance to 90% of the German population.
TK is also on the front lines of the medical cannabis discussion. In fact, TK, along with other public health insurers AOK and Barmer, have processed the most cannabis prescriptions of all insurers so far in the first year after the law change. There are now approximately 15,000 patients who have received both a proper prescription and insurance approval coverage. That number is also up 5,000 since the beginning of just this year.
In a fascinating first look at the emerging medical market in Germany, TK, in association with the University of Bremen, has produced essentially the first accessible report on approvals, and patient demographics for this highly stigmatized drug.
Because it is in German, but also contains information critical to English-speaking audiences in countries where the medical issue is being approached more haphazardly (see the U.S. and Canada), Cannabis Industry Journal is providing a brief summary of the most important takeaways from TK’s Cannabis Report.
Most Patients Are Women
This is not exactly surprising in a system where symptomology rather than ability to pay is the driver of authorizations and care. This is also exactly the opposite trend when it comes to gender at least, that emerged in Colorado on the path to medical legalization circa 2010-2014. While chronic pain is still the most common reason for dispensation, the drug is going mostly to women, not men, in their forties, fifties and sixties.
Even Chronically Ill Patients Are Still not Getting Covered
This data is super interesting on the ground for both advocates and those who are now pushing forward on “doctor education” efforts that are springing up everywhere. The only condition for which cannabis was approved 100% was for patients suffering from terminal cancer pain from tumours. In other words, they were also either in hospice or hospital where this kind of drug can be expedited and approved quickly. Other conditions for which the drug was approved were both at far lower rates than might have been expected (see only a 70% approval rate for Epilepsy and a 33% approval rate for Depression).
Expect approval rates to change, particularly for established conditions where the drug clearly helps patients, even if there are still questions about dosing and which form of cannabis works best, along with improved research, data and even patient on boarding.
Also expect interesting data to come out of this market for patients with ADHD (or ADHS).
Imported Cannabis Is Very Expensive
TK and other public health insurers are also on the front lines of another issue not seen in any other legalizing cannabis country at the moment. An eye-wateringly high cost per patient. The biggest reason? Most of the medical cannabis in the market is being imported. This will change when more cannabis begins to enter the market from other EU countries (see Spain, the Baltics and Greece) and, yes, no matter how many elements of the German government are still fighting this one when it begins to be cultivated auf Deutschland.
Most German Patients Are Still Only Getting Dronabinol
If there was one thing that foreign investors should take a look at, it is this. One year after legalization, just over 1/3 of those who actually qualify for “medical cannabis” are in fact getting whole plant medication or a derivative (like Sativex).
This means only one thing. The market is continuing to grow exponentially over at least the next five to ten years.
GW Pharmaceuticals scored a significant victory in the United States with its cannabis-based epilepsy drug Epidiolex in mid-April. The company received approval from a U.S. Food and Drug Administration (FDA) panel for its use in treating two forms of drug-resistant epilepsy.
The drug was granted “orphan drug” status in the EU a year ago.Will this be enough to move the conversation forward about cannabis as medicine in the United States?
So what does the future hold for this drug and a company, which has visited this space before? Remember Sativex?. The Company now faces real competition from a raft of companies moving into this space from just about everywhere – both from Canada and of course Europe itself.
The FDA Might be on the Verge of Approving its First Cannabis-Based Drug
It is not like this is either the FDA’s or GW Pharma’s first discussion about the medical efficacy of cannabinoids. Sativex, a mouth spray containing THC, was never granted approval in the United States for the treatment of MS – although it received such approvals in Europe.
If the FDA approves Epidiolex (made from CBD), it will be the first cannabinoid-based drug approved in the United States by the federal agency.
Will this be enough to move the conversation forward about cannabis as medicine in the United States? What will happen in the EU?
A Divergent and Highly Different Drug Market
Will the FDA finally approve at least one form of a CBD-based drug? The chances are that Epidiolex might finally move the agency to approve. However,this is not, despite the hype that the company has made in the press about this, the first cannabinoid-based drug to be approved in the United States. It might be, however, the first drug based on actual natural cannabinoids rather than synthetic ones that it approves for some purpose. Both Cesamet and Dronabinol (or Marinol) are synthetic cannabinoid drugs approved for several conditions from chronic pain caused by chemo to Parkinson’s.
But those who are hoping that this drug approval might open the floodgates at the FDA for startersshould take a pew. While Sativex was not approved in the United States, it was made available after 2011 for MS patients, particularly in Germany, which has the highest rate of MS of any European country. The problem? It was just too expensive for most people to afford – since their insurance would not cover it. And doctors were even more resistant to prescribing than they are now. So even getting a prescription was almost impossible.
That conversation was different in Europe post-2013, and there were people who managed to get a doctor to write a prescription not to mention afford the eye-watering prices sans insurance coverage.
That said, given the choice between whole plant meds, most people still prefer bud cannabis to the spray variety. And in Europe right now, that is what is on the table.
What Will This Mean in the US vs Europe?
In the US, the first thing that FDA approval will mean is drug sales for only one branded drug. That is the cynicism at play here. Furthermore, it also neatly dodges the THC issue.
In Europe? Particularly Germany? This development is not likely to make much of a dent. GW is competing with every single Canadian producer with flower-based oil – and on both the medical and non-medical CBD front. That also now includes local producers. Further, this is a market which prizes genericized drugs over name brands. In France, the distribution of Sativex was held up, primarily because of the row over cost. And who would pay.
It is also unlikely that the FDA approval in the United States will change the discussion either in the US on a federal level – or in Europe.
The most important place this news already made a dent? GW Pharma’s stock price – at least temporarily. It is also a spot of good news the company really needs. In February, the company’s GWP42006 drug designed for focal seizures (drug resistant epilepsy) failed to outperform placebo results and wiped 5% off the company’s stock.
According to a press release, last week GW Pharmaceuticals’ drug Epidiolex received a positive FDA panel review, which is an encouraging and important step towards getting the drug approved by the U.S. Food and Drug Administration and on the market in the United States. Epidiolex is an anti-epilepsy drug, taken in a syrup form, with the main active ingredient being cannabidiol (CBD), and less than 0.1 % THC.
The drug is targeted to treat Dravet syndrome (DS) and Lennox-Gastaut syndrome (LGS) a rare early-onset type of epilepsy found in children, according to Reuters. FDA staff said the drug “reduces seizure frequency in patients with drug-resistant LGS or DS while maintaining a predictable and manageable safety profile.”
GW Pharmaceuticals, founded in 1998 and based in London, is a biopharmaceutical company that has made headlines previously for developing cannabis-derived drugs. Sativex, one of the first drugs they developed, is derived from cannabis, but was not approved by the FDA. It is however available in other parts of the world, such as the EU, Israel and Canada.
If Epidiolex actually gets approval by the FDA, it will be the first-ever cannabis-derived drug available via prescription in all of the United States. According to Justin Gover, chief executive officer of GW Pharmaceuticals, this is a momentous breakthrough for the company. “We are pleased by the Advisory Committee’s unanimous recommendation to approve Epidiolex, which would provide an important treatment option for patients with LGS and Dravet syndrome, two of the most severe and treatment-resistant forms of epilepsy,” says Gover “This favorable outcome marks an important milestone in our company’s unwavering commitment to address the significant unmet need for patients with LGS and Dravet syndrome and our resolve to study Epidiolex under the highest research and manufacturing standards. We look forward to our ongoing discussions with the FDA as it continues to review the Epidiolex NDA.”
According to the GW press release, the Peripheral and Central Nervous System Drugs Advisory Committee of the FDA unanimously recommended supporting the approval of the New Drug Application (NDA) for the drug. That advisory committee is sort of like an independent panel; their unanimous vote doesn’t necessarily mean the drug will get approved, but the FDA takes their decision into consideration when approving new drugs. So this panel recommendation is certainly a good sign and shows this drug could potentially be on the path to FDA approval.
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