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Best Week, Worst Week: Health care companies score $100M; medical cannabis program fears the worst

best-worst-010618Things were looking up this week for Maryland-based companies focused on health care research as two raised nearly $100 million in financing while companies in the state’s medical cannabis program were blindsided by a reversal of federal policy which leaves more questions than answers and could force a sharp downturn in participation by doctors.

Business and health care writer Tim Curtis reported this week that Baltimore’s Personal Genome Diagnostic Inc. (PGDx) and Gaithersburg-based NexImmune raised a combined $98 million in a pair of funding rounds.

Curtis reported Thursday that PGDx, formed out of Johns Hopkins University research with a focus on tissue-based and liquid biopsy genomic products for laboratories, raised $75 million in a Series B round of funding co-led by Bristol-Myers Squibb and New Enterprise Associates, among others. The company expects to use the money to fund an initiative for regulated in-vitro diagnostic genome testing to cancer patients. On Tuesday, NexImmune, whose technology was originally developed at Johns Hopkins University, raised $23 million in a round co-led by ArrowMark Partners and Barer & Son, along with participation from Piedmont Capital Partners. The company expects the Series A funding to see it through the completion of its Phase I/II clinical trials.

While PGDx and NexImmune move on to the next stage of development, Maryland’s medical cannabis program was stunned Thursday when U.S. Attorney General Jeff Sessions rescinded the federal policy that essentially allows states to legalize some level of marijuana use.

Government affairs writer Bryan P. Sears reported Thursday that state officials expressed concerns the change in direction could lead to growers, processors and dispensers being arrested and having their businesses and assets seized and doctors either exiting the program or not signing up at all.

About 400 physicians are registered with the state medical cannabis commission to write recommendations for patients they are treating. The number has not met expectations as some doctors have declined to participate because marijuana is still illegal at the federal level. Physicians in the program now have to worry about losing their Medicaid reimbursements or their DEA licenses to prescribe controlled substances.

While some have complained that Sessions and the GOP-controlled federal government are ignoring states’ rights, Maryland Attorney General Brian E. Frosh said Maryland and other states may be in a legally indefensible position as federal law supersedes state law.

Baltimore County Democrat Robert A. “Bobby” Zirkin, the chairman of the Maryland Senate’s Judicial Proceedings Committee, sounded off after Sessions’ decision, saying the Trump administration was “stuck in the 1980s” and “(Marylanders) are not going to withhold medical marijuana from patients because Jeff Sessions is stuck in a land that time forgot.”

Frosh said that denying medical marijuana to patients counting on it to help battle cancer, AIDS and some neurological disorders is inhumane.