Cracking the cure for acne: a bright ‘spot’ in a terrible market?

Posted Feb 6 2018

Dr Boreham’s Crucible

MGC Pharmaceuticals (MXC) 11.5c

BOD Australia (BDA) 56c

Botanix (BOT) 14c (trading halt)

Zelda Therapeutics (ZLD) 12.5c

Creso Pharma (CPH) 92c

For a website with articles such as how to grow the best organic weed and where to buy the best ‘dab rigs’*, hightimes.com should be a one-eyed advocate of the virtues of cannabis.

Thus, plaudits are in order for the US counter-culture site for running a yarn titled ‘can cannabis cause acne’, at a time when dope is being pushed as a curative for anything from epilepsy to insomnia.

As it happens, hightimes concludes that if pot makes you anxious rather than relaxed, that could be conducive to acne. But the more causative reason is that cannabis hunger pangs – the munchies – lead the user to greasy fast foods and a nasty rash of zits.

Notwithstanding hightimes balanced and clear-headed analysis, our ASX listed cannabis cohort is about to unleash a range of topical treatment for a range of skin disorders including eczema, psoriasis, dermatitis, dry skin and the dreaded spots.

Clinical evidence of efficacy is mounting, although details are sparse and the path to regulatory approval in the over-the-counter cosmetics game isn’t nearly as rigorous as that for a medical product.

On Crucible’s reckoning, three companies intend releasing skincare balms this year, based on either cannabidoil (CBD) or hemp oil extracts. Not surprisingly THC – the ‘whoopee’ element of cannabis – doesn’t rate a mention.

With a track record in other cosmetics, BOD Australia last year sniffed the skunky breeze of market fashion and forged a partner with the Swiss herbal extracts company Linnea SA . This tie-up is aimed at developing cannabis based topical treatments for inflammation and sensitive skin including serums foam-based creams and balms.

The treatments, to be made in Italy, are expected to be on the shelves of all good chemists – or should that be drug stores? – this year.

BOD, by the way, is also developing hemp-infused honey, but there’s no suggestion this one should be topically applied.

BOD is hanging its hat not just on the soothing benefits of CBDs to the skin, but on Linnea’s Nioskin additive that allows the skin to absorb the unguent more effectively. Bear in mind that an enduring issue with cosmetics is that the dermis is naturally effective at keeping out foreign agents.

MGC Pharmaceuticals (MXC) is also off and racing in the Dermatological Dope Derby, last month launching  its CBD Herbal Repair Cream for mild forms of psoriasis.

Two other products – for acne and dermatitis – are slated.

It then unveiled a distribution tie up with the online sales site CultBeauty.com, which describes itself as “expert curators and trend dictators”. The distribution deal covers 15 MGC products, with a six month exclusivity period.

According to MGC, a “leading independent European dermatological clinic” – a Slovenian one, to be precise — confirmed the repair cream was effective for treating highly irritated or inflamed skin conditions.

Botanix meanwhile reports successful phase 1b clinical results for its synthetic CBD Based compound BTX1503, with the trials carried out at four Australian sites.

Of the 21 subjects with moderate to severe acne, 18 completed the program. On average, inflammatory lesions (delightfully known as papules and pustules) declined by an average 47% after 28 days of treatment.

This compares with reductions of 42% and 38% respectively for the two leading existing acne treatments: Allergan’s Epiduo and Aczone’s Galderma.

For the non-inflammatory whiteheads and blackheads, the results were about the same (“squeeze ‘em gently, we say).

Botanix aims to go further down the serious clinical path with a phase two study, costing $6-8m. Botanix has only $3.5m in the bank, but on Thursday its shares went into trading halt pending a capital raising.

Zelda Therapeutics is carrying out Chilean-based trials on eczema, but its busy slate of work also includes insomnia, eczema and autism.

The Israel-based Creso Pharma has an even broader remit, with its product pipeline ranging from the serious medical stuff to animal treatments and cannabis-infused chocolates and beverages.

With skincare, Creso claims that cannabinoids achieve the same goal of existing products without the need for harsh chemicals.

Creso hopes to release some products in 2019.

“Hemp seed oil is high (no pun intended, we presume) in vitamin A,C and E as well as omega-3 and omega-6 essential fatty acids that are all great for skin care,” Creso says.

Both hemp and CBD oil has antioxidant properties, useful for anti-ageing and reducing inflammation.

 

Go to the US or go home

A little known fact – or at least we didn’t know – is that as CBDs are a controlled substance treated in the same way as morphine or heroin, , exporting into the US requires Drug Enforcement Agency (DEA) approval.

And with the US awash with cannabis – legal or otherwise – why would the narcos approve? The restriction applies to CBD products with or without THC, which kind of doesn’t make sense.

Botanix is thus looking to go down the strictly pharmaceutical route by requesting Investigational New Drug (IND) status with the US Food & Drug Administration.

 

This will forge the way for the 400-patient phase-2 study, to be carried out here and in the US.

“No one is working on clinical development and looking for FDA approval in the same way we are,’’ says Botanix chief Matt Callahan.

After that, the company hopes a monied suitor will fund further trial and commercialisation. Callahan is heartened that big pharma Pfizer in 2016 bought Anacor – which was in phase 3 dermatitis trials – for $US5 billion.

Interestingly, Botanix’s announcement doesn’t refer to cannabis – and that’s deliberate. Callahan says the synthetic molecules were once found in a cannabis plant, but beyond that the dope link is tenuous.

“Aspirin comes from the bark of a willow tree but you don’t ask for bark at a chemist to treat pain,” he says.

Dr Boreham’s diagnosis

The potential markets are fatter than a reefer at the Nimbin MardiGrass: MGC cites a $US7.8bn market for psoriasis, while Creso cites an overall skin care market at $US180 billion.

With acne, it remains to be seen whether the unguent is truly effective. Over the last four decades, there’s been little innovation in treating nature’s cruel device to deter teenage promiscuity.

As with all of the pot stocks, it’s a moot point whether it’s more virtuous to have a targeted focus — such as Botanix or BOD on skincare – or a shotgun-scatter approach across multiple indications.

The Zeldas and Cresos need only one blockbuster product to succeed, but by spreading their cash across so many programs arguably they’re less likely to develop one.

Call him a fuddy-duddy, but Dr Boreham also likes to see revenue through the door. In this vein we note BOD’s December sales climbed to $344,000 from $104,000 a year previously, based on sales of non cannabis lines and a focus on the Chinese Daigou market.

* bong-like water pipes, for the uninitiated

Disclosure: Dr Boreham is not a qualified medical practitioner and does not possess a doctorate of any sort.  Until penning this column he did not know what a dab rig was – honest.