GW Pharma's Epidiloex Data Is Good News For Zynerba

GW Pharmaceuticals PLC GWPH's stock gained more than 17 percent Monday following the company's announcement of a second successful pivotal trial in an ongoing Phase 3 trial exploring its lead cannabinoid product, Epidiolex.

GW Pharma's strong gains helped boost shares of other pharmaceutical companies that develop and commercialize cannabinoid therapeutics. Specifically, Zynerba Pharmaceuticals Inc ZYNE saw its stock gain more than 10 percent following the announcement.

According to analysts at Jefferies, Zynerba is similarly investing synthetic cannabinoids in epilepsy delivered trandermally. Specifically, ZYN002 (CBD gel) is being explored by the company and it has initiated a Phase 2 STAR-2 trial.

Related Link: Cantor Raises GW Pharma's Target To $182 Following Second Successful Phase 3 Trial

Zynerba's primary endpoint for its study is the median percentage change in seizure frequencies over a 12-week treatment period and data is expected to be released in the first half of 2017.

"One key trial design difference is the baseline period in the ZYNE trials will have a duration of 8-weeks to evaluate seizure frequency and type of seizure whereas in the GWPH PIII trials the baseline period was a duration of 4-weeks," the analysts noted. "Furthermore, ZYNE does not require a 2-week dose titration in its dosing regimen."

Bottom line, the analysts suggested investors have "not appreciated" Zynerba's CBD program and GW Pharma's data is a "positive read through" for ZYN002.

Shares of Zynerba are Buy rated with a $32 price target.