In morning trade the Botanix Pharmaceuticals Ltd (ASX: BOT) share price has been one of the best performers on the local market with a huge move higher.
At the time of writing the dermatology company's shares are up 61% to 21 cents.
What happened?
This morning Botanix advised that it has successfully completed a Phase 1b study in patients with moderate to severe acne.
According to the release, the study met all designated endpoints and large reductions in acne lesions were observed after four weeks of treatment. Pleasingly, the treatment was significantly better than the current leading topical acne products.
In addition to this, the topical application of BTX 1503 was safe and very well-tolerated, with no reported signs of skin irritation.
As a result, the company plans to rapidly advance BTX 1503 into a Phase 2 acne patient study in North America and Australia in the second-quarter of calendar year 2018.
What is BTX 1503?
BTX 1503 is a topically applied synthetic cannabidiol acne product that offers localised delivery areas on the skin with the disease. For this reason Botanix is often categorized as a medicinal cannabis company alongside the likes of Auscann Group Holdings Ltd (ASX: AC8), Hydroponics Company Ltd (ASX: THC), and MGC Pharmaceuticals Ltd (ASX: MXC).
Should you invest?
As I have said previously, I feel Botanix could have an extremely bright future thanks to its BTX 1503 product and Permetrex proprietary drug delivery system.
After all, the acne prescription market is expected to be worth up to US$4.5 billion per year by 2018 and current oral treatments have horrific side effects.
However, a phase 2 trial will not be cheap and the company may need to raise funds for it in my opinion. But considering this positive news, I don't think it will be short of support from institutional investors.
