The COVID pandemic has helped the Cannabis industry to bounce back after a terrible 2019. One stock that suffered in the sell-off experienced last year is Epidiolex maker GW Pharmaceuticals (NASDAQ:GWPH). However, it has picked momentum this year with the recent increase in demand for pot driving impressive Q1 results.
GW’s Q1 revenue jumped threefold
The company produces Epidiolex which is a drug that contains cannabidiol (CBD) for seizure treatment related to Dravet Syndrome or Lennox-Gastaut syndrome. In the first quarter, the company saw its revenue jump threefold from $39.2 million in Q1 2019 to $120 million this year. On a sequential-quarter basis, the revenue shot from $109 million in Q4 2019 thanks to growing global sales of Epidiolex. In the quarter sales of the drug were $116.1 million with US sales accounting for around $106.1 million.
Besides the attractive revenue numbers, the company ended the quarter strongly with $500.9 million in cash and investments. Going forward the company could see a surge in Epidiolex sales as the company plans to enhance the availability of the drug to patients across the US and Europe.
Descheduling of Epidiolex by the FDA boosting sales
Recently the FDA descheduled Epidiolex from Scheduled I status to Scheduled V under the Controlled Substances Act. This means the marijuana-derived drug will be easily accessible to patients across the US despite marijuana not being legal at the federal level.
According to GW Pharmaceuticals, there was consistency in new patients’ prescriptions in the quarter which shows the strength in demand. The company management indicated that the company is well-positioned to emerge from the COVID-19 crisis strongly thanks to massive growth prospects for its drug globally.
In the first quarter, the company’s R&D expenses went towards the development of Epidiolex and the advancement of nabiximols clinical trials as well as other pipeline programs. GW has adequate cash to survive the COVID-19 crisis and keep its operations running.