Here’s why the Incannex (ASX:IHL) share price is up 10% today.

The Incannex (ASX:IHL) share price is flying today after the company’s new drug delivered positive results in its latest clinical trial.

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Incannex Healthcare Ltd (ASX: IHL) shares are up again today as the company announced its new CBD-based drug is more effective in treating rheumatoid arthritis than currently available medications.

The Incannex share price opened nearly 15% higher than yesterday’s close after the news broke. It has since dropped back to 22.5 cents, representing a 9.76% gain for the day so far. 

Incannex is a pharmaceutical development company working on the commercialisation of medical cannabis and psychedelic medicine therapies.

Here’s a closer look at what the company announced today.

Rheumatoid arthritis treatment breakthrough

The Incannex share price is surging higher today after the company heralded another research program for its new drug IHL-675A following positive results in a pre-clinical study. 

The company’s latest study found the drug is up to 3.5 times more effective at reducing arthritis than common treatments currently on market.

Currently, the main treatment for rheumatoid arthritis is hydroxychloroquine (HCQ), marketed as Plaquenil. The company noted long term use of HCQ has been linked to increased cardiovascular mortality.

Incannex’s new treatment is a combination of cannabidiol (CBD) and HCQ. By combining CBD And HCQ, the amount of HCQ needed to treat arthritis can be reduced up to 10-fold, resulting in fewer side effects for patients.

In further news boosting the Incannex share price, the new drug also showed potential for treating other types of inflammation. The study demonstrated it to have “potent anti-inflammatory activity” when treating inflammatory lung conditions such as asthma and bronchitis, as well as colitis.

Incannex plans to market IHL-675A in key global markets, including the United States, Europe, Japan and Israel. It has filed an International Patent Application and plans to pursue US Food and Drug Administration registration, subject to the ongoing success of clinical trials. 

Commentary from management

Incannex Healthcare CEO and managing director Joel Latham said IHL-675A has the potential to be a breakthrough in the treatment of rheumatoid arthritis. He commented:

Hydroxychloroquine is an established medication for rheumatoid arthritis and IHL-675A has been demonstrated to outperform it at reducing disease severity in an animal model.

The benefit of the CBD and hydroxychloroquine combination in IHL-675A is potent. The observation that IHL-675A was as effective or better than a standard dose of hydroxychloroquine, even though it contained 90% less drug, is an exciting result for the Company.

Incannex share price snapshot

Over the past 12 months, the Incannex share price has risen by more than 460%. The company’s shares are also up by 50% year to date.

Based on the current Incannex share price, the company has a market capitalisation of around $217 million with approximately 1 billion shares outstanding.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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