Shares in GW Pharmaceuticals rose nearly 9.5% after the UK biotech firm's prescription cannabis drug was approved for use in Canada.
The spray-based drug contains a cannabis extract
Sativex is used to treat the central nervous system and alleviate the symptoms of multiple sclerosis (MS).
The Salisbury-based company said this was the world's first approval of a medicine derived from cannabis.
Delays in development of the product - its first to come to the market - has hit GW's stock price in the past.
Shares in GW shares closed up 11.5 pence at 132.5p on the London Stock Exchange on Tuesday.
Sativex, administered by a mouth spray, will be marketed in Canada by German company Bayer.
GW said it hoped to launch Sativex in Canada in late spring.
"The approval of Sativex reflects the urgent need for additional treatment options in the field of neuropathic pain in MS," said Dr Allan Gordon of Mount Sinai Hospital, Toronto, in a statement issued by regulators Health Canada.
Some MS patients already smoke cannabis to relieve their symptoms.
Satifex consists of a cannabis extract containing tetrahydrocannabinol and cannabidiol.
GW had originally hoped to win UK approval for Sativex in 2003.
The UK government granted GW Pharma a licence to cultivate cannabis for medical research purposes and plants are grown at a secret location in the English countryside.
Last December, however, the UK authorities said they wanted more evidence about its benefits before they approved it.
"We very much hope it wont be long before those in the UK are sharing the benefits which people with MS in Canada can now experience," said Mike O'Donovan, chief executive of the Multiple Sclerosis Society.
GW spokesman Mark Rogerson said the company would look to market Sativex in the EU after UK approval is granted.
This year, he said GW would take the "first steps" to seek approval for a cannabis-derived drug in the US.