Both Pain Therapeutics (Nasdaq: PTIE) and King Pharmaceuticals (Nasdaq: KG) shares took a stinging hit last Thursday after the FDA announced an upcoming advisory panel hearing for a rival drug.

Pain and King's lead drug candidate is an abuse-deterrent version of OxyContin that they call Remoxy. The drug finished up phase 3 testing last year. What spooked investors on Thursday was that privately held Purdue Pharma, which markets the often abused OxyContin that King and Pain aim to improve on, revealed that it also had an abuse-deterrent program that wasn't dead in the water. The company announced an upcoming May 5 FDA advisory panel for this mysterious compound.   

The FDA holds advisory panels most often for drugs in development that have substantial questions about their marketing applications, and that the agency is often on the fence about approving. King and Pain investors were perturbed about Purdue's May 5 hearing because so little is known about this drug program. As a private corporation, Purdue is not required to update the public on the state of its drug pipeline.

The FDA advisory panel notice for this Purdue drug can be seen in the PDF file located here. Purdue has been noticeably tight-lipped about this latest iteration of its abuse-deterrent OxyContin program (probably for competitive reasons) and the only public hint we have about the nature of this drug candidate is what is mentioned in advisory hearing notice when the FDA describes the drug: "The sustained-release characteristics of this formulation are purportedly less easily defeated than other formulations of OxyContin."

This compound wouldn't represent Purdue's first attempt at making an abuse-deterrent version of OxyContin. Purdue first shelved a new drug application for its abuse-resistant OxyContin project back in 2002 after the naloxone it used in the drug caused some absorption problems for the oxycodone ingredient of the pain reliever. Those problems could be the same or similar to setbacks Pain Therapeutics had with its naltrexone/oxycodone combination.

At the time of the naloxone/oxycodone failure, Purdue mentioned in a press release that it had other abuse-deterrent programs underway, and the May 5 hearing and new drug application must be a result of one of these programs making it this far.

Pain and King have guided for a 2008 timeline for a filing of their Remoxy marketing application. It's definitely not good news to see Purdue ahead of Pain and King, but the prospects of rival abuse-resistant drugs was never in doubt.

The hearing won't have probative value just for Purdue's compound but will give all the abuse-resistant drugmakers such as Elite Pharmaceuticals (AMEX: ELI), Alpharma (NYSE: ALO), and Pain's partners DURECT (Nasdaq: DRRX) and King (to name a few) a chance to see how the agency views these compounds.

I'll be tuning in for the May advisory panel hearing that could help to make or break all drugs in this class of therapies.  

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