Trial milestone for over-the-counter CBD insomnia treatment
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Our Wise-Owl cannabis Investment Bod Science (ASX:BOD) is in pole position to deliver Australia’s first CBD (cannabidiol) product to be available in pharmacies within the next 12 months.
Bod is progressing a clinical trial of a low-dose CBD formulation to treat symptoms associated with insomnia. Today, the company announced it had passed a significant milestone, with trial screening of 370 potential patients now completed. This means that Bod remains on track to meet their recruitment target of 198 patients by the end of this month, enabling them to launch the 8 week trial afterwards.
The size of the prize is substantial as insomnia remains a lucrative market, valued at US$4.3B globally in 2020 and tipped to grow to US$6.3Bn by 2030. In addition, research from FreshLeaf analytics tips the Schedule 3 (S3 - i.e. products available at pharmacies without requiring a prescription) CBD market to reach A$250M at maturity with over 2M customers in Australia.
We think that speed to market will be crucial in capturing and retaining market share of the S3 market. According to FreshLeaf, almost 1-in-4 medicinal cannabis patients take a low dose (ie under 150 mg) CBD product - there is a strong likelihood that many of these patients will switch to purchasing from a pharmacy once low-dose CBD products become available over-the-counter. At 10,000 customers, this represents ~A$29M p.a for the Australian market. This is the prize that we suspect Bod can capture, should its clinical trial provide a positive outcome.
On this note, Bod has already secured a distribution deal with Australia’s leading private pharmaceutical company Arrotex for the low-dose S3 CBD product - as part of the arrangement, Arrotex has paid $500k upfront to Bod for a 5 year licence to supply the product.
What’s up next?
We anticipate patient recruitment and randomisation (ie which patients receive the CBD product vs which receives the placebo) for Bod’s S3 product by the end of March.
This will be followed by an 8 week trial undertaken by Australia’s leading sleep research organisation, the Woolcock Institute, ending around June/ July.
Once the trial is completed and data analysed, if successful (ie there is a statistically significant difference between patients on the CBD product vs the placebo), then Bod will submit a dossier to the Therapeutic Goods Administration (TGA) - if this regulatory body approves, then Bod will be able to market its CBD product via pharmacies nationwide.