Marijuana stocks were under pressure yesterday after Zynerba Pharmaceuticals (ZYNE) reported top-line data that missed the mark.

The shares fell more than 55% on this news and we believe this plunge is due to concerns pertaining to Zynerba’s transdermal delivery system.

While we are favorable on the indications that Zynerba is focused on, we believe that GW Pharmaceuticals (GWPH) represents the best long-term biotech cannabis investment opportunity.

GW: A Big Year Ahead

The next 12 months will be very significant for GW Pharma.

After the market closed yesterday, the company reported third quarter financial results which highlighted several major potential catalysts for the firm.       

CEO Justin Gover said, “I am pleased to report the NDA submission process for Epidiolex is now underway with the final sections of the submission expected to be completed in October. With a clear view now towards our anticipated approval, we are making excellent progress with preparations to ensure a highly successful launch in 2018.”   

2018: The Year of Epidiolex

GW is currently conducting its Epidiolex orphan epilepsy program in Dravet syndrome, Lennox-Gastaut Syndrome (LGS), Tuberous Sclerosis Complex (TSC) and Infantile Spasms (IS).

More than 1,500 patients have been exposed to Epidiolex treatment and 97% of the patients that complete Phase 3 trials have entered a long-term extension.

GW reported that it is on track to be ready for an FDA GMP inspection, which is expected to take place in early 2018. The company has also been focused on scaling up in Epidiolex manufacturing capabilities ahead of an expected commercial launch.

A major development reported by GW pertains to the 14 distinct patent families that are being prosecuted for the use of CBD in the treatment of epilepsy. The company expects decisions for several patents towards the end of 2017 and in the first half of 2018.

Owns a Pipeline of Products that are in Advanced Clinical Trials

GW has by far, the most advanced pipeline of cannabis-derived products and this should create catalysts for years to come.

Some of the studies that investors should be aware of include:

• Phase 3 trial in Tuberous Sclerosis Complex is ongoing
• Part A of two-part Phase 3 trial in Infantile Spasms is ongoing
• CBDV Phase 2 partial-onset epilepsy study in adults fully enrolled and expects to report data at the end of 2017/early 2018
• GW has completed the Phase 1 trial for its Neonatal Hypoxic-Ischemic Encephalopathy (NHIE) intravenous CBD program. The company received the Orphan Drug and Fast Track Designations from FDA and EMA

• Open label study in Rett syndrome and Phase 2 placebo-controlled trial in planning for the first half of 2018.

A Favorable Long-Term Outlook

GW is changing the landscape of the biotech industry and the company already sells a cannabis-derived treatment for multiple sclerosis is 27 countries. GW is a company that investors need to watch as it continues to execute on its pipeline and create value for shareholders.

The cannabis industry would be a beneficiary of GW’s success since the company is developing its products from the actual cannabis plant. This is different from companies like Insys Therapeutics (INSY) and Zynerba Pharmaceuticals (ZYNE) which are focused on creating treatments from synthetic cannabis.

We are favorable on GW due its extensive pipeline of products in advanced stages of FDA testing, its balance sheet which is strong enough to support the cost of clinical trials, its impressive Wall Street coverage, and the $390 acquisition price placed on the company by Goldman Sachs.