Pfizer ($PFE) hasn't decided whether to pursue additional work to seek FDA approval for the storied painkiller Remoxy, and faces a decision on the continuance of the program, sending shares of two companies with financial stakes in the candidate crashing down this morning.
Pain Therapeutics ($PTIE) tumbled down by 47.7% to $2.78 per share late this morning after revealing a letter from Pfizer. Based on guidance from a recent meeting with the FDA, Pfizer said, the company expects "years of delay" and "additional cost" to respond to concerns from U.S. regulators by no sooner than mid-2015, according a letter from the drug giant to Pain Therapeutics this week.
On the back of the news, shares of Durect ($DRRX) dropped by more than 40% in morning trading. The company provides technology for Pfizer and Pain Therapeutics' Remoxy that makes the formulation of oxycodone difficult for addicts to use the drug to get high. Such tamper-resistant painkillers have found support from the FDA as officials seek to stem abuse and deaths from prescription opioid abuse.
Pfizer's team for the Remoxy program plans to meet with the company's R&D leaders in the coming weeks about the next steps for drug development, which the company took over via its 2011 buyout of King Pharmaceuticals for $3.6 billion. The FDA denied approval of the drug with complete response letters in 2008 and 2011. According to Durect, Pfizer expects that the FDA will require additional clinical studies of the drug, including a pivotal test of bio-equivalency to show that an updated formulation of the drug is consistent with a previous version.
Pfizer has been slicing and dicing R&D in an effort to cut costs and to back only programs deemed worthy of investment. Last year the company's R&D spending dropped by 13% to $7.9 billion from $9.1 billion in 2011. We'll see whether the R&D group will spare the Remoxy effort.