Progenics Gets Backed Up

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Developing new drugs is a complicated process; delays and setbacks are an almost inevitable part of the process of bringing new compounds to market. Earlier in the week, Progenics Pharmaceutics (Nasdaq: PGNX) and drugmaker giant Wyeth (NYSE: WYE) announced a delay in one of their methylnaltrexone programs.

Progenics is developing its altered version of naltrexone in various dosage forms as a treatment for a variety of gastrointestinal disorders. The largest market opportunity for its methylnaltrexone compound is in treating opioid-induced bowel dysfunction (OBD), which it was running a phase 2 study in.

After this week, though, it's back to the drawing boards, as the oral version of methylnaltrexone failed to "exhibit sufficient clinical activity" in its phase 2 testing. (The drug is also being tested in subcutaneous and intravenous administration.) Now the new timeline for the oral version is for a New Drug Application in late 2009 or early 2010, which pushes possible approval out until 2011.

The biggest winner from the Progenics drug delay is definitely Adolor (Nasdaq: ADLR) -- if results from the Entereg phase 3 study that it is running with GlaxoSmithKline (NYSE: GSK) are positive. The Progenics delay could give Adolor a marketing start of a year or more for Entereg as an OBD treatment, if it doesn't experience any more delays in its program. An update on the orally-administered Entereg's progress is expected later this quarter, although off-label use in OBD could start as soon as the first half of next year if it gets approved to treat another gastrointestinal disorder.

The good news for Progenics shareholders is that the company is sticking to the timeline to file marketing applications with the FDA for the subcutaneous and intravenous forms of methylnaltrexone in 2007. If Progenics and Wyeth can't develop a much more convenient oral formulation of the drug, though, its market potential and use will be quite limited.

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Fool contributor Brian Lawler does not own shares of any company mentioned in this article. The Fool has a disclosure policy.