Pfizer finally abandons all hope in Remoxy, and Durect/Pain Therapeutics feel the sting

Pfizer ($PFE) had hung on to high hopes for the drug Remoxy long after the tamper-resistant pain therapy endured its second rejection at the hands of the FDA in 2011. It even officially re-upped for the late-stage comeback try last fall, committing to see it through a third try. But today Pain Therapeutics says that the pharma giant has finally thrown in the towel, handing back rights to the long-delayed treatment and washing its hands of any further development work.

The news pushed Pain's shares ($PTIE) into meltdown mode Monday morning, blasting away more than half of the company's share value. Durect's stock ($DRRX) was part of the collateral damage. The biotech, which provided the technology and outlicensed the therapy to Pain 12 years ago, saw its shares plunge by 46%. Pain later did a deal with King Pharma, which was subsequently bought out by Pfizer.

Remoxy, an extended-release version of oxycodone designed to leave a bad taste in the mouth of anyone who tried to chew the tablet for an illicit rush, had been one of the primary attractions for Pfizer when it bought out King for $3.6 billion. The FDA's second rejection for the therapy came as Pfizer was undergoing a huge reorganization of R&D, but until today the company seemed willing to endure heavy costs in an effort to build its pain drug portfolio, planning to wrap up its complete response to the FDA's rejection letter in the middle of next year--a full 7 years after the first rejection.

Over that time a number of drug developers have been making speedy progress with tamper-resistant oxycodone therapies of their own, which would likely have cut deep into the value of any other similar drugs coming into the market later. Purdue Pharma, for example, won a recent approval for Targiniq, which pairs oxycodone with naloxone. Crush it and snort it, once a common recreational high, and the naloxone--a drug used to counter opioid overdoses--blocks the euphoric high that addicts are after.

Pain Therapeutics CEO Remi Barbier, though, professed to be delighted by the turn of events.

Pain Therapeutics CEO Remi Barbier

"It's a privilege to reacquire worldwide rights to an unencumbered Phase III asset that targets a $2 billion market," said the CEO in a statement. "We look forward to the prospects of resubmitting the REMOXY NDA under our control. We are also enthusiastic about initiating discussions with potential pharmaceutical partners around this drug asset." 

- here's the release