If you've forgotten the perils of investing in biotechnology, look no farther than development-stage Adolor (NASDAQ:ADLR) for a refresher. At high noon, the stock is a not-so-high $14.83, down 32%.

Today's pain was in reaction to disappointing results for experimental drug Entereg to combat postoperative ileus (bowel obstruction). Perhaps curiously, the company announced plans to submit a New Drug Application for Entereg to the FDA "late in the first half of 2004."

What do partner GlaxoSmihtKline (NYSE:GSK) and Adolor see that the market doesn't?

Entereg has been shown, when compared to placebo, to speed recovery. The recovery from gastrointestinal function (the primary study focus) is eight to 10 hours faster. On average, patients are discharged from the hospital 14 to 15 hours sooner. (Go Sooners!) Both certainly sound good.

What prompted the sell off -- and analysts at both Hambrecht and First Albany to cut their ratings on Adolor -- was the considerable variation across the results from four Phase III trials. More specifically, there is the very real concern that this variation could lead the FDA to request further study -- and force the company to spend money with no assurance of approval.

Adolor soared in recent months in anticipation of the company getting Entereg to market -- which would be a first. With $113 million in cash and virtually no debt, the company is not in imminent danger of running out of money; however, it did burn through $55 million (in operating expenses) in the first nine months of 2003.

Sadly, Adolor's "novel products to relieve pain" offer little relief to current shareholders, which are, at last count, 82.7% institutional. At today's $500 market capitalization, and an uncertain FDA review ahead, perhaps this one is best left to those institutions -- and speculators. At least for now.

You can e-mail W.D.Crotty at wdcrotty@fool.com. Join other investors at the Biotechnology and the Pharmaceuticals discussion boards at the Motley Fool. For a 30-day free trial to the discussion boards, click here.