Epidiolex Maker GW Pharmaceuticals Acquired For $7.2 BillionFebruary 9, 2021
GW Pharmaceuticals, the British company behind CBD-based anti-seizure drug Epidiolex, has been acquired by Dublin, Ireland-based drugmaker Jazz Pharmaceuticals. Under the terms of the agreement, Jazz will pay $220 per share of GW—$200 in cash and $20 in Jazz shares—amounting to a total value of $7.2 billion. The transaction is expected to close in the second quarter of the year.
GW has received a great deal of attention since the FDA approved Epidiolex in June 2018, making it the first medication derived from cannabis to win U.S. government approval. Among CBD’s effects, its power as an anti-convulsive is perhaps its best understood property. Epidiolex has since won approval from European pharmaceutical regulators and launched in the U.K. and Germany, with additional countries expected this year. It has also been highly lucrative for GW, generating over $500 million in sales last year. GW is also working to win approval for another product it has developed to treat the symptoms of multiple sclerosis that contains both CBD and THC.
By acquiring GW, Jazz Pharma adds its cannabis expertise to its numerous operations. It’s best known product is Xyrem, a sleep disorder treatment which had sales of $1.6 billion in 2019. The company posted record revenue of $2.3 billion in 2020, and maintained an operating cash flow above $700 million. Because the exclusivity period for Xyrem is about to run out, the companies expect that GW’s stable of brands will account for more than half the combined company’s revenue by as early as 2022.—Danny SullivanSubscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning. You will also receive the Cannabis edition as part of your subscription.