(Reuters) - Zynerba Pharmaceuticals Inc’s stock lost more than half its value on Monday after the U.S. drug developer said its synthetic cannabis-based gel for epilepsy failed a mid-stage study.

Zynerba’s gel contains a synthetically processed formulation of cannabidiol (CBD), a non-psychoactive component of the cannabis plant.

Although many U.S. states have sanctioned the medical and/or recreational use of cannabis, drugs derived from the plant could take longer than others to hit the market.

Under U.S. federal law, marijuana is considered a dangerous substance with no medicinal value, making additional approvals for marijuana-derived treatments necessary prior to launch.

Two doses of Zynerba’s ZYN002 gel were tested against a placebo in the study.

Neither dose induced a statistically significant improvement in seizure frequency versus the placebo in patients who were already on up to three anti-epileptic medications.

The 188-patient study comprised adults suffering from epilepsy with partial seizures, which occurs when epileptic activity takes part in a localized part of the brain.

Even though the availability of the drug in blood plasma increased with the higher dose, it did not translate into a clinically meaningful benefit.

Based on this data, Cantor Fitzgerald analysts said they were uncertain whether there was a suitable path forward for development of ZYN002 in adult focal seizures.

Data from studies evaluating the gel’s use in osteoarthritis patients and in children with Fragile X Syndrome is expected in the coming months, the company said.

Zynerba is still evaluating data to determine next steps, but said it was not giving up on epilepsy as a target, on a conference call with analysts.

Britain’s GW Pharmaceuticals, considered a pioneer in cannabis-drug development, is expected to file a U.S. marketing application for its CBD-based epilepsy drug, Epidiolex, this year.

A New England Journal of Medicine editorial earlier this year noted that Epidiolex data represented “the beginning of solid evidence for the use of cannibinoids in epilepsy,” after an era of anecdote and emotion-based debates.

The intrinsically low bioavailability of CBD in Zynerba’s gel seemed like a potentially significant hurdle for a systemically acting topical medicine, Leerink’s Paul Matteis said in a client note titled “ZYNE Topical CBD Failure Removes an Overhang for GW”.

Bioavailability denotes the degree by which a drug’s active ingredients are absorbed by the blood.

Zynerba’s shares plunged as much as 60 percent to $5.93 in morning trading. GW’s shares rose about 4 percent to $122.45.