Pain Therapeutics Drops on FDA Delay of Pfizer Painkiller

Pfizer Inc. (PFE) and Pain Therapeutics Inc. (PTIE) were delayed in gaining U.S. approval for a second time of a new type of painkiller designed to curb drug abuse, sending Pain Therapeutics shares down the most in 11 years.

Pain Therapeutics dropped $3.94, or 43 percent, to $5.30 at 4 p.m. New York time in Nasdaq Stock Market trading in its biggest decline since the company first sold shares to the public in July 2000. Pfizer fell 57 cents, or 2.8 percent, to $20.08 on the New York Stock Exchange.

The Food and Drug Administration postponed clearance of the medicine, called Remoxy, citing issues unspecified by Pfizer and Pain Therapeutics in a statement today. New York-based Pfizer said last month that it was working on a “manufacturing issue” in the new drug application that may delay approval.

“It’s been a rocky road for Remoxy,” Les Funtleyder, a portfolio manager and health-care strategist with Miller Tabak & Co. in New York, said in a telephone interview today. “It’s in a class that has had other problems, like addiction. I don’t think the FDA necessarily saw benefit to this.”

Funtleyder, whose fund owns Pfizer shares, said it’s possible the drugmaker will divert resources to another painkiller, Oxecta. That treatment, a short-acting oxycodone pill with tamper-resistant properties, received FDA approval earlier this week. Pfizer’s partner on Oxecta is Palatine, Illinois-based Acura Pharmaceuticals Inc.

May Drop

“It’s often the case with Complete Response Letters that eventually the pharmaceutical company winds up dropping the drug altogether,” Funtleyder said. “Especially with the Acura drug approved, it might not be worth their while.”

Acura rose 37 cents, or 9.9 percent, to $4.10 in Nasdaq trading.

“While we can’t discuss the contents of the letter at this time, Pfizer is working to understand and address the issues in the FDA Complete Response Letter,” MacKay Jimeson, a spokesman for the world’s largest drugmaker, wrote today in an e-mail. “Pain is an important strategic disease area for Pfizer. We share the concern about misuse and abuse of opioid medicines and are committed to being part of the solution to address this important public health and safety issue.”

Taffy-Like Pill

Remoxy is a long-acting oxycodone pill with a taffy-like texture that prevents the medicine from being crushed, snorted or dissolved in alcohol for a quick high. The drug was one of the experimental pain products Pfizer gained in its $3.3 billion acquisition of King Pharmaceuticals in March.

Austin, Texas-based Pain Therapeutics and Cupertino, California-based Durect Corp. (DRRX) helped develop the therapy and will get royalties on sales. Durect sank 96 cents, or 31 percent, to $2.13 on the Nasdaq for the biggest decline since July 2004.

Remoxy was delayed in 2008 when the FDA asked for more lab data. The companies resubmitted the drug application at the end of last year. The FDA has also been working with all makers of long-acting pain pills on a new doctor training and education program to minimize the risk of abuse and overdose.

Doctors considered sustained release, high-dose painkillers major breakthroughs for cancer and chronic pain when closely held Purdue Pharma LP won approval for OxyContin in 1995, though the drug soon proved easy to manipulate. The Stamford, Connecticut, drugmaker introduced a new version last year with properties intended to prevent it from being easily cut, broken, crushed or dissolved to release the medicine all at once.

The FDA won’t allow any of the new formulations be marketed as preventing abuse without long-term epidemiological studies.

Pfizer also has a morphine pill designed to deter abuse called Embeda that has been off the market since March because of manufacturing issues.

To contact the reporters on this story: Catherine Larkin in Washington at clarkin4@bloomberg.net; Meg Tirrell in New York at mtirrell@bloomberg.net.

To contact the editors responsible for this story: Adriel Bettelheim at abettelheim@bloomberg.net; Reg Gale at rgale5@bloomberg.net.

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