U.K. Government Rejects GW Pharmaceuticals PLC's Cannabis Drug

On Wednesday, U.K.-based media reported that a cannabis drug developed by GW Pharmaceuticals PLC (NASDAQ: GWPH) has been rejected by the National Institute For Health and Care Excellence (NICE).

The government body is tasked with determining suitable medicines for use within England's state health service. GW Pharmaceuticals produces Sativex, a cannabis-based drug that is sprayed under a patient's tongue for treating spasticity in multiple sclerosis.

GW Pharmaceuticals sells Sativex as a prescription drug within the U.K. by its partner, German group Bayer, and is approved for use in more than 20 countries.

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NICE determined that use of the drug does not provide value for the state health system. Paul Cooper, a consultant neurologist at the Greater Manchester Neuroscience Centre said that, “there are better ways to improve care for people with MS.”

"We think it is a terrible shame that, because of cost-cutting presented as science, MS patients in England are being denied a treatment which works in many cases," a GW Pharmaceutical spokesman said. "It is sad that it should be put out of the reach of many patients in the very county where it was developed."

In addition to Sativex, NICE has also rejected non-cannabis based drugs, including Fampyra which is sold in the United States by Biogen.

Shares of GW were down 2.2 percent at $77.99.