Shares of Pain Therapeutics Inc. (NASDAQ: PTIE) continue to take a beating following news that their lead drug candidate Remoxy will be subjected to further tests before Pfizer agrees to seek FDA approval for the pain medication. Just yesterday shares were as high as 4.92 but with Pfizer’s decision announced during their earnings conference call that price tumbled to a 52-week low of 2.92 and that price could easily fall further.
Pfizer actually called Remoxy a “challenging” asset on that conference call, causing significant concern amongst investors as they heard that new studies would be required to support resubmission before the FDA.
According to reports Remoxy will be subjected to three additional studies with the completion date expected sometime in March 2013. Pfizer has said they would then meet with the FDA to discuss the results and determine whether or not they address the concerns expressed in the Complete Response Letter issued by the FDA back in 2011. Among the issues of concern expressed by the FDA, “the Chemistry, Manufacturing, and Controls section of the NDA for REMOXY.”
PTIE provided little reassurance to shareholders as they noted they would make a “go/no-go” decision on Remoxy next year. Without a vote of confidence many investors are taking it as a sign that the drug will be shelved and PTIE will be left with nothing. Even more frustrating for investors, there has been no mention as to what lead Pfizer to call for additional studies, essentially leaving investors to simply speculate as to the cause.
Clearly Pfizer’s concerns must be significant and given the nature of Remoxy one may conclude that the product’s variable oxycodone release may pose problems. While the potential that exists in the pain medication arena is massive there are serious risks that biopharmaceutical companies are exposed to and Pfizer may simply want to step aside unless they are able to mitigate those risks.
Perhaps no prescription drug has been subjected to such scrutiny as oxycodone given its reputation for abuse and addiction and while PTIE was granted an exclusive license from Durect Corp. to develop and commercialize Remoxy and other opioid products using its ORADUR technology as a delivery platform intended to eliminate abuse there seems to be a problem.
Problems are not what PTIE needs as they already have an accumulated deficit in excess of $132 million as of June 30, 2012 and with no product sales to speak of they face an uncertain future if Remoxy is put to bed.
Not helping matters any for PTIE is the number of oxycodone-based painkillers in the market and in development. This will make the FDA approval process all the more difficult considering the agency will be looking for nearly flawless study results before they give the green light. If there are any questions concerning the safety or potential for abuse then it wouldn’t be in the FDA’s best interest to grant approval.
With shares sinking and the general consensus being that PTIE will miss out on Remoxy there is an attractive opportunity for risk takers to gamble. It would appear likely that shares will continue to fall in the near future and possibly all the way up until March when those new studies are complete but if those results come back positive and Pfizer is confident that they can satisfy the FDA’s demands then PTIE could see a massive comeback.