Yes, GW Pharmaceuticals (NASDAQ:GWPH) is the biggest marijuana-focused biotech stock on the market. The company's promising cannabinoid Epidiolex could very well become a blockbuster success story in the near future in treating children with rare forms of epilepsy. But is GW Pharmaceuticals the best stock to buy right now? No.

Two stocks that could have significantly greater upside, in my view, are Vertex Pharmaceuticals (NASDAQ:VRTX) and Zynerba Pharmaceuticals (NASDAQ:ZYNE). Here's why investors might want to forget about GW Pharmaceuticals and instead buy Vertex and Zynerba.

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Vertex Pharmaceuticals

There is at least one similarity between GW Pharmaceuticals and Vertex: Both companies focus on rare diseases affecting children. GW Pharmaceuticals' Epidiolex targets treatment of Dravet syndrome and Lennox-Gastaut syndrome (LGS), two types of childhood-onset epilepsy. Vertex develops drugs that target specific genetic mutations that cause cystic fibrosis (CF), which causes difficulty in breathing for children.

The biggest advantage that Vertex has over GW Pharmaceuticals is that it already has multiple products on the market that are making plenty of money. Last year, Vertex's Kadcyla and Orkambi generated combined revenue of nearly $1.7 billion. 

Another plus for Vertex is its growth potential. The target population eligible for treatment by Kadcyla and Orkambi currently totals 29,000 patients. Vertex hopes to more than double that potential patient population by winning approval for a two-drug therapy and several three-drug combinations in development. 

Vertex stock looks expensive at first glance, with shares trading at 42 times expected earnings. However, with a realistic opportunity to grow earnings by more than 60% annually over the next five years, the biotech's valuation doesn't seem nearly as scary.

GW Pharmaceuticals could also enjoy tremendous growth, of course. However, it could face more risks than Vertex does -- including the potential for legalized medical marijuana to compete with Epidiolex. Vertex might also have competition down the road, but the biotech enjoys a head start over its rivals. 

Marijuana buds and beakers on table

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Zynerba Pharmaceuticals

If you're really interested in biotech stocks focused on cannabinoid development, Zynerba could be a better bet than GW Pharmaceuticals. Like GW, Zynerba is developing drugs based on synthetic versions of chemicals found in marijuana.

Zynerba's lead candidate is ZYN002, which, like GW's Epidiolex, is a cannabidiol (CBD) product. There are a couple of key differences between ZYN002 and Epidiolex, though. First, Zynerba's candidate is targeting different indications. ZYN002 is being evaluated in multiple phase 2 studies for treatment of epilepsy in adults with focal seizures, osteoarthritis, and fragile X syndrome (a genetic disease that can cause learning disabilities).

The second key difference between ZYN002 and Epidiolex is the method of delivery. Epidiolex is an oral solution of CBD. ZYN002 is delivered through a transdermal gel. This delivery through the skin bypasses metabolism in the liver and could be a key advantage for the drug if it's approved.

Zynerba's pipeline also includes ZYN001, a pro-drug form of THC, the primary psychoactive chemical in marijuana. ZYN001 is currently in two early-stage clinical studies targeting treatment of fibromyalgia and peripheral neuropathic pain.

So why might Zynerba be a better choice for investors than GW Pharmaceuticals? It comes down to risk versus reward.

GW's Epidiolex could achieve peak annual sales of $3 billion if the most optimistic projections are met. That's higher than the $2 billion peak sales estimate that Cantor Fitzgerald analyst Elemer Piros thinks Zynerba's ZYN002 might make if approved for treating epilepsy in adults with focal seizures. However, GW Pharmaceuticals' market cap stands at $2.7 billion, while Zynerba's market cap is less than $270 million. 

Granted, Epidiolex has completed multiple phase 3 studies, whereas ZYN002 is still in phase 2. Still, though, Zynerba arguably offers significant more upside potential for the level of risk associated with its pipeline than GW does.  

Keith Speights has no position in any stocks mentioned. The Motley Fool recommends Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.