Pfizer (NYSE:PFE) released data last week on its tamper-resistant pain killer, ALO-02. The phase 3 trial was an open-label, single-arm trial to measure safety, so we didn't learn much about the efficacy of the drug.
A whopping 60% of the patients dropped out of the study over the course of the year, including 19% of the patients that said adverse events were the primary reason for dropping out. Nausea, constipation, vomiting, and headaches were the most common issues. There were more serious adverse events reported, but they were so rare that they probably weren't drug related. Presumably the other 41% of patients that dropped out either felt the drug wasn't working, their pain symptoms stopped (although patients were supposed to have chronic pain), or experienced some issue unrelated to the drug.
What's interesting is that Pfizer said, "The discontinuation rate was within the expected range based on similar long-term safety studies with other extended-release opioid formulations." I have no reason not to believe the pharma, but it seems kind of shocking that a 60% dropout rate is the norm. How do you run a trial to measure how well your drug works when more than half the patients drop out before it's completed?
And for those that stay in the trial, drugmakers have to deal with the placebo effect affecting the results. Subjective patient-reported outcomes are very difficult to control.
There's clearly a large societal need for drugs like ALO-02 because it's designed to be harder to abuse. The Food and Drug Administration has supported the push to decrease abuse of pain drugs. And in theory developing tamper-resistant drugs is low risk too because they use active ingredients that have already been proven to work. The active ingredient in ALO-02, for instance, is oxycodone.
But given the issues with patient dropouts and placebo effect, investors should be cautious about investing in this space. For Pfizer, one drug isn't going to matter, but failures of pain drugs being developed by Zalicus and Pain Therapeutics could be disastrous as investors in Durect found out earlier this year.
Fool contributor Brian Orelli has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.