GW Pharmaceuticals Is Taking Off as the Cannabis Industry Grows - TheStreet

Cannabis-related stocks are among the hottest on the markets today. For investors, they represent an opportunity to enter a nascent industry -- one with the potential to keep them seeing green for years.

By a number of measures, cannabis is the fastest-growing industry in the U.S. This has been a byproduct of legalization initiatives nationwide. Now, 25 states and the Washington D.C. have legalized marijuana usage in some form. Some analysts predict that the legal pot market will hit $6.7 billion in sales this year.

Until recently, if you wanted to invest in even medical marijuana companies you had to turn to thinly traded penny stocks trading on the over-the-counter markets, but now they are popping up on the Nasdaq. This includes GW Pharmaceuticals (GWPH) - Get Report

Shares shot up by more than 17% Monday on word that one of its key treatments is nearing FDA approval. The price dropped slightly in Tuesday trading but the company remains a good buy for investors.

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GW Pharmaceuticals' Epidiolex treats severe forms of epilepsy in the world's most vulnerable population: children. Epidiolex helps reduce seizure rates among pediatric epileptic patients suffering from Dravet and Lennox-Gastaut syndromes by using pharmaceutical cannabidiol. That means that, upon approval, it wouldn't be illegal in the 25 states in which medical marijuana is still forbidden

Yesterday, the U.K.-based company announced that it is closer to approval following promising phase 3 clinical trial results. In the study, patients who took the drug saw seizures decrease by an average of 42%.

The GW Pharmaceuticals plans to file a new drug application with the FDA in the first half of 2017. And when that happens, profits will skyrocket.

But GW Pharmaceuticals isn't the only way to profit from the coming Green Rush.

Insys Therapeutics is another pharmaceutical company developing drugs based on cannabis. It is currently working on an epilepsy treatment similar to Epidiolex. This could make Insys an attractive takeover candidate, indeed.

If you're looking beyond pharmaceutical companies, there are other ways to profit from pot -- and perhaps not in ways that you'd expect.

Tech pioneer and giant Microsoft has begun a partnership with California-based startup Kind to market infrastructure software that will make the regulation of legalized recreational and medical marijuana more efficient. The software tracks plants from seed to dispensary and can help ensure that companies are complying with state laws.

In addition, fellow tech and cloud company Oracle has also developed a tracking system for marijuana that is already in use among state governments. Watch the tech sector as the legal status of recreational marijuana spreads across the country, and infrastructure is needed for regulation.

Whether you're betting on cannabis to save children's lives or are seeking ways to score as state governments legitimize America's love for marijuana, look for new opportunities to profit from pot.

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The author is an independent contributor who at the time of publication owned none of the stocks mentioned.