The True Meaning and Significance of the FDA’s Approval of Epidiolex



 On June 25, the FDA approved the cannabis-derived drug, Epidiolex for treatment of epilepsy in children, as well as seizure disorders in adults who have drug-resistant epilepsy.

This FDA action created shockwaves of nervous excitement throughout the health care sphere. It certainly appears as a win for medicine in general, as well as for cannabis, hemp, and the greater natural medicine and nutraceutical spheres.

The industry’s enthusiasm for this is tempered, because it’s unclear how, if at all, this ruling changes the legal status of cannabis, hemp, and CBD. If anything, the legal picture now becomes more clouded, as Leafly reported.  The DEA will have to re-evaluate how it schedules drugs, because now that the FDA approved a plant-derived cannabinoid, it throws more legal doubt upon the appropriate scheduling of cannabis as Schedule 1. After all, Schedule 1 drugs are those that are considered to have no medical value. 

It’s possible that GW Pharma could use their drug patent to attempt to suppress the larger CBD industry. Only time will tell if they will attempt to do so. My intention here is not to speculate on how the legal picture will change for CBD and hemp. Only time will answer that question.  The purpose of this article is to clear up a few misconceptions about drug patent laws, and more importantly, shine a light on  a peculiarly overlooked aspect of the approval of Epidiolex that needs to be addressed. I believe the approval of Epidiolex marks a sea change, the beginning of a new era in medicine as a whole in the US, for reasons described here.

First, it’s important to understand a bit about pharmaceutical patents. A cornerstone of US Drug patent law is based upon drug companies developing novel molecules via novel processes. These are patents may be referred to “molecular basis” patents, sometimes called Markush structures. This dual nature of novel process and novel molecules that creates patent protection.

 These patents are structured as broadly as possible, independently protecting both molecules and processes so drug manufacturers are granted patents on both, separately and together, to protect their investment in drug development costs.  This is critical for drug companies, especially today, as costs to develop new drugs are spiraling out of control. More on that in a moment.

Other drug patents may be referred to as “delivery patents.” The intellectual property in these patents are more about how the drug is delivered, and specifically protects drug delivery systems and unique combinations of molecules that may or may not be patentable on their own. Epidiolex is patented on this basis, as the patent itself revers to “administration of a lipophilic medicament via a mucosal surface which upon hydration form an emulsion containing the lipophilic medicament which is capable of adhering to a mucosal surface and allowing controlled release of the medicament. The invention further provides pharmaceutical formulations which contain, as active ingredients, specific combinations of cannabinoids in pre-defined ratios.”

As that passage describes, Epidiolex isn’t, as some has claimed, a CBD isolate product. Instead, it’s based on cannabinoids and other cannabis biomolecules in specific, patented ratios.

So the basis for the patent of Epidiolex is the delivery system, that is mucosal, or what we’d refer to as “sublingual.” 

Based on this patent, it’s unlikely that GW Pharma would have a case for pursuing CBD companies, unless somebody reverse-engineers Epidiolex and starts marketing it as an obvious knock-off. As far as that goes, a drug patent probably wouldn’t be necessary for GW to pursue this kind of “counterfeiting,” as that could be pursued under trademark law, that which already protects name brand products and allows them to go after counterfeiters of their product. 

Further, hemp and/or CBD companies, as are all supplement and nutraceutical companies, are already barred from making any kind of disease claim under the Dietary Supplement Health And Education Act of 1994, or DSHEA. This act allows dietary supplements to be sold in the US so long as no claims are made as to the product’s ability to treat a known disease or medical disorder.

Therefore the value of Epidiolex’s approval as a drug isn’t in its formulation, as a novel agent, class of chemicals, or delivery system, as none of those provide patent protection for Epidiolex.

Rather, it’s the specific disease-based drug claim aspect of the patent that makes Epidiolex’s approval valuable, since it’s neither a novel molecule, nor a novel process, nor even really a very unique formulation of cannabinoids, but simply a very specific formulation.

With FDA approval for Epidiolex, GW Pharma has now been granted the right to market a very specific plant extract as a drug to treat a very specific disorder, epilepsy. With that approval, Epidiolex can now enter the mainstream health care marketplace, which means it can be distributed by pharmacies and hospitals nationwide, and more importantly, it means insurance can and will cover this drug for very costly reimbursement. Leafy, linked above, reported that Epidiolex will cost about $25,000 per year for treatment, compared to $1800 per year for a CBD product from a regular hemp-based CBD company.

This dramatic increase in cost happens because of the dis-intermediation of health care costs caused by health insurance. When someone buys a more or less average CBD product on the open market to treat epilepsy, they’re paying roughly $150 per month for their own treatment. When their insurance pays for it, they may have a $20-50 copay, but the rest of the massive 40x cost increase is covered by the insurance company.

We see as similar use of patent law in the approval of prescription fish oil products. Fish oils are also a natural molecule, and were approved via a similar process as Epidiolex, though the patent protection has been weaker than hoped. It’s interesting to note that mainstream medical & pharma articles refer to these fish oil products as “a drug.” Again, it’s the specific combination of molecules that otherwise wouldn’t be patentable, specifically approved by the FDA to make disease claims regarding a specific disorder, hyperlipidemia. And again, the most important thing about this approval is that it allows doctors to prescribe prescription “drug” fish oil, to patients, and thus to bill their insurance for their fish oil at a massive markup and profit for the drug company. 

Another interesting precedent was set when statin drugs first came on the market. A somewhat obscure and seldom-used traditional Chinese herb, Red Rice Yeast, was found to have an active ingredient called Monacolin K. It so happens to be the exact chemical structure as the first statin drug to receive FDA approval, lovastatin. 

The fact that the drug was available in a much cheaper, health-foods store alternative posed a profit-limiting problem for drug companies. So they exercised their muscle—after all, the FDA is essentially the cartel enforcement division of the pharmaceutical industry, through the mechanism of regulatory capture. The drug companies, acting through the FDA, protected their market. 

In a summary fashion, the FDA limited the potency of red rice yeast on the consumer market, creating a ridiculously low cap on Monacolin K content in red rice yeast, rendering inert pharma'scompetition from a cheap, widely available natural substance, and thus protecting pharma profit margins.

Given all this regulatory control of markets and the ability for pharma to use the FDA to protect its markets, why is pharma exploring plant medicines?

Simply put, all of the low-hanging fruit in drug development has been picked. Pharmaceutical drugs, based on the patent protection of novel compounds, are forced to work via disrupting normal physiology to manage symptoms. 

Over the last few years, drug development costs have risen dramatically. In software, Moore's law is an often-repeated aphorism that computer processor speed doubles every few years, while the cost of the processors falls by half. 

In drug development, we see Moore's law in reverse, sometimes wittily referred to as Eroom's law. That is, the cost of developing a new drug doubles roughly every 9 years. Current estimates range from $648 million  for a smaller pharma company to develop a new drug, to over $2 billion for a larger company. Larger companies incur more costs because they develop more new drugs, but 9 of of 10 attempts to create a new pharmaceutical fail, and fail expensively. 


Enter Plant Medicine

Plant-made drugs have become the new darling of the pharmaceutical industry. Plants have a much lower cost of operation than a team of chemists and the facilities needed for them to develop and synthesize new compounds at-scale. 

Currently, many plant-based drugs are in development. Genetic engineering is the order of the day, as drug companies still want novel compounds to patent on a molecular basis. They're simply using botanical infrastructure to produce these new drugs, most of which are bio-engineered proteins. 

However, as drugs like Epidiolex take off, pharma will no doubt take notice of simpler, cheaper plant medicines to develop, and simply use drug patent law as a vehicle to assert disease claims. 

With these trends in mind, we can expect to see more non-GMO plant based drugs developed from known botanical medicines which are simply approved as specific chemical compound ratios of plants. 

As these trends develop, botanical medicines approved by the FDA may allow a new golden age of botanical treatment in mainstream medicine, bringing us back full circle to the early years of medicine, before the Flexner report and the pharma takeover of the US health care industry that happened in the early part of the last century. 

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