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GW Pharmaceuticals plc Reports Fiscal Third Quarter 2018 Financial Results and Operational Progress

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- Epidiolex® (cannabidiol) oral solution approved by FDA and on track to be launched in Fall -
- Conference call today at 4:30 p.m. ET -

LONDON and CARLSBAD, Calif., Aug. 07, 2018 (GLOBE NEWSWIRE) -- GW Pharmaceuticals plc (NASDAQ:GWPH, GW, the Company or the Group)), the world leader in the development and commercialization of cannabinoid prescription medicines, announces financial results for the third quarter ended 30 June 2018.

"The recent FDA approval of Epidiolex represents a major medical advance for patients with Lennox-Gastaut Syndrome and Dravet syndrome. We anticipate rescheduling to be completed within 90 days of FDA approval and for product launch to take place in the Fall," stated Justin Gover, GW's Chief Executive Officer. "In preparation for launch, we have now completed the hiring of our U.S. sales organization and are engaged with patient organizations, physicians and managed care organizations/payors. This approval has been a transformative event for GW, not only opening a new chapter as a commercial-stage company, but also validating and reinforcing our world leadership in cannabinoid science, and the potential of our product pipeline."

OPERATIONAL HIGHLIGHTS

  • Epidiolex (cannabidiol)
    • Regulatory:
      • FDA approval for the treatment of seizures associated with LGS or Dravet syndrome
      • Epidiolex rescheduling expected within 90 days of FDA approval
      • European submission under review by the EMA with decision expected in Q1 2019
      • FDA issuance of a priority review voucher (PRV) for Epidiolex.
    • Manufacturing
      • Commercial product being manufactured and prepared for shipping to the U.S.
      • Continued investment in expanded facilities to meet anticipated long-term demand  
    • Commercial:
      • U.S. sales organization fully recruited comprising two national directors, eight regional managers plus 66 Neurology Account Managers  
      • Active engagement with U.S. payors ongoing with clinical presentations to plans that cover over 80% of covered lives in the U.S. 
      • U.S. supply chain platform in place which will employ a closed model distribution network of five Specialty Pharmacy Providers (SPP's)
      • Commercial footprint in place in 5 major European markets in readiness for 2019 European launches
    • Epilepsy Clinical trials
      • Three Phase 3 clinical trials published - two in The New England Journal of Medicine and one in The Lancet
      • Phase 3 trial in Tuberous Sclerosis Complex ongoing with data expected H1 2019
    • Autism
      • Decision to expand target indications for Epidiolex beyond epilepsy to autism. IND expected to be submitted for pivotal Rett Syndrome study in Q4 18.
    • Expanded access program and open label extension:
      • Over 2,000 patients now have been exposed to Epidiolex treatment
    • Life-cycle management
      • Several new formulations of CBD in development including modified oral solution, capsule and an intravenous formulation
    • Exclusivity
      • 7-year orphan exclusivity confirmed by FDA, 6-month pediatric extension expected
      • Key favorable patent grants by USPTO related to the use of CBD in epilepsy, including claims for the treatment of relevant seizure types associated with LGS and Dravet syndrome, as well as the use of CBD with clobazam
        • Patents align directly with new Epidiolex FDA label and to be listed in Orange Book
        • Patent expiry dates to 2035
      • Additional patent applications under review and being filed as new data is generated
  • Pipeline progress
    • Sativex® (nabiximols)
      • U.S. development and commercialization rights wholly owned by GW
      • Initial U.S. target indication: Multiple Sclerosis spasticity. Three positive Phase 3 trials completed in Europe
      • Plans to meet with FDA in H2 18 to determine MS spasticity regulatory pathway in the U.S.
      • Over 20 placebo-controlled trials already completed in other indications, representing significant U.S. lifecycle management opportunities
    • CBDV
      • 10-patient investigator-initiated expanded access program for seizures associated with autism underway
      • Investigator-led 100 patient placebo-controlled trial in autism spectrum disorder due to commence in Q3 18
      • Open label study in Rett syndrome and seizures due to commence Q3 18
    • CBD:THC in Glioblastoma
      • Recent data presented from the Phase 2 study showed significant increase in median survival for patients taking CBD:THC of 662 days compared to 369 days on placebo
      • Pivotal clinical development program plans under development
      • Orphan Drug Designation from both FDA and EMA for CBD:THC to treat glioblastoma
    • Neonatal Hypoxic-Ischemic Encephalopathy (NHIE) intravenous CBD program
      • Phase 1 trial complete
      • Orphan Drug and Fast Track Designations granted from FDA and EMA
      • Phase 2 trial in planning

FINANCIAL HIGHLIGHTS

  • Cash and cash equivalents at 30 June 2018 of £334.0 million ($440.2 million) compared to £241.2 million as at 30 September 2017
     
  • Revenue for the nine months ended 30 June 2018 of £10.7 million ($14.2 million) compared to £6.1 million for the nine months ended 30 June 2017
     
  • Loss for the nine months ended 30 June 2018 of £136.7 million ($180.2 million) compared to £90.3 million for the nine months ended 30 June 2017

Solely for the convenience of the reader, the above balances have been translated into U.S. dollars at the rate on 30 June 2018 of $1.31792 to £1. These translations should not be considered representations that any such amounts have been, could have been or could be converted into U.S. dollars at that or any other exchange rate as at that or any other date.

Conference Call and Webcast Information
GW Pharmaceuticals will host a conference call and webcast to discuss the third quarter 2018 financial results today at 4:30 pm ET. To participate in the conference call, please dial 877-407-8133 (toll free from the U.S. and Canada) or 201-689-8040 (international). Investors may also access a live audio webcast of the call via the investor relations section of the Company's website at http://www.gwpharm.com. A replay of the call will also be available through the GW website shortly after the call and will remain available for 90 days. Replay Numbers: (toll free):1-877-481-4010 or 919-882-2331 (international). For both dial-in numbers please use conference Replay ID: 35897.

About GW Pharmaceuticals plc and Greenwich Biosciences, Inc.
Founded in 1998, GW is the world leader in the development and commercialization of cannabinoid prescription medicines. The Company's lead product, EPIDIOLEX® (cannabidiol) oral solution, received U.S. FDA approval in June 2018 and is under review by European regulators. Previously, GW commercialized the world's first plant-derived cannabinoid prescription drug, Sativex® (nabiximols) in Europe and is now advancing plans to develop this medicine in the US. The Company has a deep pipeline of additional cannabinoid product candidates which includes compounds in development for epilepsy, autism, glioblastoma, and schizophrenia. For further information, please visit www.gwpharm.com.

Forward-looking statements
This news release contains forward-looking statements that reflect GW's current expectations regarding future events, including statements regarding financial performance, the timing of clinical trials, the timing and outcomes of regulatory or intellectual property decisions, the relevance of GW products commercially available and in development, the clinical benefits of EPIDIOLEX (cannabidiol) oral solution and the safety profile and commercial potential of EPIDIOLEX. Forward-looking statements involve risks and uncertainties. Actual events could differ materially from those projected herein and depend on a number of factors, including (inter alia), the success of GW's research strategies, the applicability of the discoveries made therein, the successful and timely completion and uncertainties related to the regulatory process, and the acceptance of Sativex, EPIDIOLEX and other products by consumer and medical professionals. A further list and description of risks and uncertainties associated with an investment in GW can be found in GW's filings with the U.S. Securities and Exchange Commission, including the most recent Form 20-F filed on 4 December 2017. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. GW undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise.

Enquiries:

GW Pharmaceuticals plc  
Stephen Schultz, VP Investor Relations (U.S.) 917 280 2424 / 401 500 6570
   
U.S. Media Enquiries:
Sam Brown Inc. Healthcare Communications
 
Christy Curran
Mike Beyer
615 414 8668
312 961 2502
   
EU Media Enquiries:
FTI Consulting
 
Ben Atwell
Simon Conway
+44 (0) 3727 1000

 


 
GW Pharmaceuticals plc
Condensed consolidated income statement
Three months ended 30 June 2018 and 2017
         
    30 June 30 June 30 June
    2018 2018 2017
    $000's £000's £000's
Revenue   3,457     2,623     2,412  
Cost of sales   (1,741 )   (1,321 )   (1,110 )
Research and development expenditure   (24,503 )   (18,592 )   (27,936 )
Sales, general and administrative expenses   (35,158 )   (26,677 )   (11,751 )
Net foreign exchange gain/(loss)   21,825     16,560     (8,410 )
Operating loss   (36,120 )   (27,407 )   (46,795 )
Interest expense   (303 )   (230 )   (266 )
Interest and other income   1,452     1,102     456  
Loss before tax   (34,971 )   (26,535 )   (46,605 )
Tax (expense)/benefit   (734 )   (557 )   6,247  
Loss for the period   (35,705 )   (27,092 )   (40,358 )
         
Loss per share – basic and diluted   (10.5c )   (8.0p )   (13.3p )
Loss per ADS – basic and diluted(1)   (126.0c )   (96.0p )   (159.6p )
         
Weighted average ordinary shares outstanding (in millions) – basic and diluted       338.6     303.9  
                 
All activities relate to continuing operations.
(1) Each ADS represents 12 ordinary shares
               
                 


     
Condensed consolidated statement of comprehensive loss
For the three months ended 30 June 2018 and 2017
   
  30 June
2018
£000's
30 June
2017
£000's
Loss for the period (27,092 ) (40,358 )
Items that may be reclassified subsequently to profit or loss    
Exchange gain/(loss) on retranslation of foreign operations 959   (508 )
Other comprehensive gain/(loss) for the period 959   (508 )
Total comprehensive loss for the period (26,133 ) (40,866 )
         


         
GW Pharmaceuticals plc
Condensed consolidated income statement
Nine months ended 30 June 2018 and 2017
         
    30 June 30 June 30 June
    2018 2018 2017
    $000's £000's £000's
Revenue   14,154     10,740     6,095  
Cost of sales   (4,440 )   (3,369 )   (2,512 )
Research and development expenditure   (107,608 )   (81,650 )   (80,007 )
Sales, general and administrative expenses   (81,321 )   (61,704 )   (27,725 )
Net foreign exchange loss   (801 )   (608 )   (583 )
Operating loss   (180,016 )   (136,591 )   (104,732 )
Interest expense   (923 )   (700 )   (509 )
Interest and other income   4,783     3,629     1,042  
Loss before tax   (176,156 )   (133,662 )   (104,199 )
Tax (expense)/benefit   (4,014 )   (3,046 )   13,878  
Loss for the period   (180,170 )   (136,708 )   (90,321 )
         
Loss per share – basic and diluted   (54.7c )   (41.5p )   (29.8p )
Loss per ADS – basic and diluted(1)   (656.4c )   (498.0p )   (357.6p )
         
Weighted average ordinary shares outstanding (in millions) – basic and diluted       329.6     303.4  
                 
All activities relate to continuing operations.
(1) Each ADS represents 12 ordinary shares
               
                 


     
Condensed consolidated statement of comprehensive loss
For the nine months ended 30 June 2018 and 2017
   
     
  30 June
2018
£000's


30 June
2017
£000's
Loss for the period (136,708 ) (90,321 )
Items that may be reclassified subsequently to profit or loss    
Exchange gain/(loss) on retranslation of foreign operations 19   (267 )
Other comprehensive gain/(loss) for the period 19   (267 )
Total comprehensive loss for the period (136,689 ) (90,588 )
         


             
GW Pharmaceuticals plc
Condensed consolidated statement of changes in equity
Nine months ended 30 June 2018 and 2017
             
      Share      
  Share premium Other Accumulated  
  capital account reserves deficit Total
  £000's £000's £000's £000's £000's
Balance at 1 October 2016 302     556,477     19,538     (177,827 )   398,490  
Exercise of share options 2     88     -     -     90  
Share-based payment transactions -     -     -     8,141     8,141  
Loss for the period -     -     -     (90,321 )   (90,321 )
Deferred tax attributable to unrealized share option gains -     -     -     (251 )   (251 )
Other comprehensive loss -     -     (267 )   -     (267 )
Balance at 30 June 2017 304     556,565     19,271     (260,258 )   315,882  
             
             
             
Balance at 1 October 2017 304     556,570     18,822     (297,521 )   278,175  
Exercise of share options 2     -     -     -     2  
Issue of share capital 33     223,037     -     -     223,070  
Expense of new equity issue -     (911 )   -     -     (911 )
Share-based payment transactions -     -     -     15,742     15,742  
Loss for the period -     -     -     (136,708 )   (136,708 )
Deferred tax attributable to unrealized share option gains -     -     -     2,202     2,202  
Other comprehensive gain -     -     19     -     19  
Balance at 30 June 2018 339     778,696     18,841     (416,285 )   381,591  
             


         
GW Pharmaceuticals plc
Condensed consolidated balance sheets
As at 30 June 2018 and 30 September 2017
         
    As at
30 June
As at
30 June
As at
30 September
    2018    2018    2017 
Non-current assets   $000's £000's £000's
Goodwill   6,866     5,210     5,210  
Other intangible assets   2,855     2,166     1,049  
Property, plant and equipment   65,768     49,903     43,666  
Deferred tax asset   11,287     8,564     6,282  
    86,776     65,843     56,207  
Current assets        
Inventories   26,333     19,981     4,244  
Taxation recoverable   2,499     1,896     20,072  
Trade receivables and other assets   23,367     17,730     11,217  
Cash and cash equivalents   440,190     334,005     241,175  
    492,389     373,612     276,708  
Total assets   579,165     439,455     332,915  
Current liabilities        
Trade and other payables   (52,876 )   (40,121 )   (33,119 )
Current tax liabilities   (2,558 )   (1,941 )   (838 )
Obligations under finance leases   (282 )   (214 )   (205 )
Deferred revenue   (1,074 )   (815 )   (2,307 )
    (56,790 )   (43,091 )   (36,469 )
         
Non-current liabilities        
Trade and other payables   (11,602 )   (8,803 )   (9,256 )
Obligations under finance leases   (6,053 )   (4,593 )   (4,755 )
Deferred revenue   (1,815 )   (1,377 )   (4,260 )
Total liabilities   (76,260 )   (57,864 )   (54,740 )
Net assets   502,905     381,591     278,175  
         
Equity        
Share capital   447     339     304  
Share premium account   1,026,255     778,696     556,570  
Other reserves   24,831     18,841     18,822  
Accumulated deficit   (548,628 )   (416,285 )   (297,521 )
Total equity   502,905     381,591     278,175   
         
         


 
GW Pharmaceuticals plc
Condensed consolidated cash flow statements
For the nine months ended 30 June 2018 and 2017
           
  Nine months ended   Nine months ended   Nine months ended
  30 June   30 June   30 June
  2018     2018   2017
  $000's     £000's   £000's
Loss for the period (180,170 )   (136,708 )   (90,321 )
Adjustments for:          
Interest and other income (4,783 )   (3,629 )   (1,042 )
Interest expense 923     700     509  
Tax expense/(benefit) 4,014     3,046     (13,878 )
Depreciation of property, plant and equipment 6,190     4,697     3,781  
Impairment of property, plant and equipment -     -     95  
Reversal of impairment of property, plant and equipment -     -     (216 )
Amortization of intangible assets 480     364     168  
Net foreign exchange losses 800     607     583  
(Decrease)/increase in provision for inventories (477 )   (362 )   80  
Decrease in deferred signature fees (4,169 )   (3,163 )   (1,097 )
Share-based payment charge 20,743     15,742     8,141  
Loss on disposal of property, plant and equipment 149     113     605  
  (156,300 )   (118,593 )   (92,592 )
(Increase)/decrease in inventories (20,789 )   (15,774 )   52  
Increase in trade receivables and other assets (3,033 )   (2,301 )   (1,914 )
Increase/(decrease) in trade and other payables and deferred revenue 9,305     7,061     (1,279 )
Research and development tax credits received 26,509     20,114     21,679  
Income taxes paid (2,562 )   (1,944 )   (1,277 )
Net cash outflow from operating activities (146,870 )   (111,437 )   (75,331 )
Investing activities                          
Interest received 2,205     1,673     970  
Purchases of property, plant and equipment (22,399 )   (16,996 )   (12,989 )
Purchase of intangible assets (1,730 )   (1,313 )   (468 )
Net cash outflow from investing activities (21,924 )   (16,636 )   (12,487 )
Financing activities                          
Proceeds on exercise of share options 3     2     91  
Proceeds of new equity issue 293,987     223,070     -  
Expenses of new equity issue (1,201 )   (911 )   (134 )
Interest paid (923 )   (700 )   (729 )
Repayment of fit out funding (384 )   (291 )   (748 )
Repayment of obligations under finance leases (202 )   (153 )   (160 )
Net cash inflow/(outflow) from financing activities 291,280     221,017     (1,680 )
Effect of foreign exchange rate changes on cash and cash equivalents (144 )   (114 )   (810 )
Net increase/(decrease) in cash and cash equivalents 122,342     92,830     (90,308 )
Cash and cash equivalents at beginning of the period 317,848     241,175     374,392  
Cash and cash equivalents at end of the period 440,190     334,005     284,084   
               
                 

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