DURECT Corp. (NASDAQ:DRRX) is down 9.2% at 12:45 p.m. EDT after the U.S. Food and Drug Administration's advisory committee voted 14 to 3 recommending the agency not approve Remoxy ER, an abuse-deterrent extended-release pain medication being developed by its partner Pain Therapeutics (NASDAQ: PTIE).
DURECT's involvement with Remoxy comes from its contribution of the abuse-deterrent portion of the medication through its Oradur technology. Being much more dependent on Remoxy, Pain Therapeutics is down about 70%.
This isn't the first time (or second or third) that Remoxy ER has run into trouble getting approved, with the FDA issuing multiple complete response letters -- the agency's euphemism for a rejection letter -- for the drug over the last decade. Pain was partnered with Pfizer through its 2011 acquisition of King Pharmaceuticals, but the big pharma saw the writing on the FDA's walls and handed rights back to Pain in 2014.
DURECT is due $1.5 million in development milestone payments and could get tiered royalties of 6% to 11.5% of net sales depending on sales volumes if Pain gets Remoxy ER approved.
The FDA is scheduled to make its final decision on or before Aug. 7, 2018 -- although that's more of a goal than a deadline. While technically this was only an advisory vote by the committee of outside experts and the FDA gets the final say, it's pretty rare for the agency to go against a committee's negative recommendation, especially when it's this lopsided.
Fortunately for DURECT, the company has other drugs in development, including an internal candidate, DUR-928 -- for liver diseases such as nonalcoholic steatohepatitis -- that's in phase 2 development.