Motley Fool Australia

Why cannabis company Botanix rocketed higher today

man riding bull on an upward trending arrow
Image source: Getty Images

The Botanix Pharmaceuticals Ltd (ASX: BOT) share price has continued its impressive run and is up over 14% to 24 cents in morning trade.

This means the clinical stage cannabinoid company’s shares have gained almost 250% since the start of the year.

Why is the Botanix share price charging higher today?

Investors have been buying the company’s shares this morning following the announcement of new data from studies recently conducted around its cannabidiol antimicrobial platform.

According to the release, new data has shown that a new drug candidate from Botanix’s cannabidiol antimicrobial platform has potent activity against hypervirulent strains of the bacteria Clostridium difficile.

This is a major positive as the release explains that Clostridium difficile is the most commonly acquired hospital infection worldwide and is responsible for over 30,000 deaths each year in the United States alone.

It is also responsible for nearly 500,000 infections annually. Combined, the company estimates that it accounts for US$5.2 billion in health care costs each year in the country.

The study showed that cannabidiol was effective at killing all the major human and veterinary strains of C. difficile, with potencies similar to currently used antibiotics.

It was also effective against the super hypervirulent epidemic strain of C. difficile, ribotype 027. This strain is responsible for severe outbreaks of disease in North America and Europe and has reduced susceptibility to current antibiotics and spreads more easily within hospitals because they can resist typical hospital environment, cleaning, and disinfectants.

It was also proven to be effective again ribotype 078. This strain is generally associated with livestock, such as cattle and pigs. It frequently spreads between animals and humans with no apparent geographic barrier.

Botanix’s founder and executive director, Matt Callahan, said: “We are overwhelmed by the potential this new data presents. Recently we announced the ground-breaking discovery that MRSA superbugs do not develop resistance to cannabidiol, as part of our BTX 1801 program. Now we have shown cannabidiol is also an effective antibiotic against C. difficile, the bacteria that the US Centers for Disease Control and Prevention regards as a global threat requiring urgent and immediate action.”

Elsewhere in the industry today, the Althea Group Holdings Ltd (ASX: AGH) share price has stormed to a new record high and the Cann Group Ltd (ASX: CAN) share price is up 2%.

Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

*Returns as of 6/8/2020

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Related Articles...

Latest posts by James Mickleboro (see all)