business

Why Grass Is Greener Than This Pot Substitute

Unimed's FDA-approved synthetic pot is, like, languishing

It's enough to make Cheech and Chong blush: California and Arizona approve the use of marijuana for medical purposes through voter initiatives. An outraged Clinton Administration vows to punish doctors who prescribe marijuana and other drugs made legal by the states. Meanwhile, AIDS and cancer patients turn to the media with emotional testimonies affirming pot's therapeutic value.

Amid the brouhaha, you'd think that AIDS patients could score cannabis only in clandestine meetings with the local pusher. But long before Californians were able to fire up doobies legally, a small biotech company in suburban Chicago was building a business marketing marijuana--or at least a form of it. Unimed Pharmaceuticals Inc. racked up 1995 sales of $6.03 million from its sole product, Marinol, the only prescription drug to use a synthetic substance based on THC, the active ingredient in marijuana, as an appetite stimulant. "Unlike marijuana, our product doesn't differ from batch to batch," says Unimed CEO and President Stephen M. Simes. "Our product has been through controlled, clinical trials--it's safe."

Be that as it may, many in the AIDS population prefer real pot. Some proponents of legalization cite research suggesting that marijuana can combat wasting--the severe weight loss that's often associated with AIDS. They complain that Marinol oral capsules are too slow to sink into the bloodstream and that they have unpleasant side effects. "I know so many people who get sick on the stuff," says John Hudson, director of Flower Therapy, a San Francisco firm that sells real marijuana for medicinal purposes. "It's a joke."

PRICEY. Marinol was approved by the Food & Drug Administration for cancer in 1985 and for AIDS in 1992. Unimed markets it as safer than marijuana, which contains carcinogens. It also doesn't get you high (though some users don't consider that a selling point). Plus, Marinol is reimbursable by HMOs and Medicaid. The drug can cost between $120 to $240 per month. In contrast, Hudson says, an equivalent amount of pot, about two ounces, runs $800. Unimed's Simes says price isn't the issue. "I don't think the motivations behind those referendums are purely medical," he sniffs. "Many just want to use it recreationally."

Wall Street isn't showing much giddiness over Unimed's stock, which has hovered in the $7 range after hitting a high of $8.50 in September, 1996. "It's a good company with solid management," grouses Sandra J. Hollenhorst, an analyst with John G. Kinnard & Co. in Minneapolis. "I think people are pooh-poohing Marinol because they simply want to get marijuana legalized." That may be true. The question is whether Unimed's pot pills can rise above the smoke.

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