Epidiolex approved, but DEA scrutiny to come

Given that it was the first treatment that contains a purified drug substance derived from marijuana to receive regulatory approval in the USA, one might have expected the Food and Drug Administration’s (FDA) green light for Epidiolex (cannabidiol) to lift shares in its developer, GW Pharmaceuticals (Nasdaq: GWPH).

In fact, the UK company’s stock was more than 4% down after Monday’s trading. The approval had been expected and markets were unimpressed at the prospect of the Drug Enforcement Administration (DEA) now having to review Epidiolex because of its potential for abuse, meaning the launch of the treatment is now unlikely to happen before the fourth quarter of this year.

Epidiolex has been approved for the treatment of seizures associated with two rare and severe forms of epilepsy, Lennox-Gastaut syndrome and Dravet syndrome, in patients two years of age and older.