PropThink: PTIE Down on Disappointing Pfizer Commentary and Pushback; Stock Could Trade Lower
(Thomson Reuters ONE) -
By David Moskowitz
Shares of Pain Therapeutics (NASDAQ:PTIE) are off 25% as partner Pfizer
(NYSE:PFE) noted Thursday on its earnings call that Remoxy, PTIE's lead product,
is a "challenging" asset and that new studies are required to support
resubmission of the drug in the U.S. Recall that many had expected Pfizer to
resubmit the NDA for Remoxy in the near-term based on encouraging results from
recently completed biostudies and an expected meeting with the FDA in 2H12. It
is unclear whether PFE recently met with the FDA, but the large-cap
pharmaceutical company is now saying that it will run 3 additional studies that
are expected to complete in March 2013. At that time, Pfizer plans to meet with
the FDA to discuss the results and whether they are adequate to address the
concerns noted in the Complete Response Letter (CRL) issued by the agency in
2011. These words were not comforting and certainly dim prospects for good news
for PTIE in the near term. Most troubling was PFE's statement that it will make
a "go/no-go" decision on the drug next year, indicating that Remoxy's fate is
still very much up in the air. A key driver of concern around this statement is
based on the recently completed studies, which many thought were positive; the
new question is why Pfizer feels that it is necessary to run more trials.
Notably, PFE is also developing its own tamper resistant oxycodone product
candidate, ALO-02, and while committed to abuse-resistant opioids, PFE could
favor this formulation over Remoxy given much better economics. Expect the
shares to trade down as investors seek to deploy investment capital elsewhere.
This also applies to shares of Durect Corp. (NASDAQ:DRRX), given that a major
portion of its value is tied to Remoxy as well. Note that PTIE has about $2.00
per share in cash, so this level should provide a backstop for the stock, but
also indicates that downside off of Thursday's initial reaction could get worse.
See this article in its original form.
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Datum: 01.11.2012 - 16:55 Uhr
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