Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

The Tricky Business of Perfecting Pain Meds

By

Covidien and CombinatoRx make inroads, but managing pain is still a problem to be solved.

PrintPRINT
The market for pain medications is an interesting space for a pharmaceutical company to try growing deeper roots; there's no lack of chronic patients for the drugs, but tolerance and dependence can keep doctors from prescribing the drugs for long periods of time. Aside from these issues, generics abound in the sector.

Pain medications that are longer-acting or abuse-deterrent could be the key to opening up this market. Covidien (COV) and CombinatoRx (CRXX) shareholders were pain-free on Tuesday after the companies' drug Exalgo got approval from the FDA. The pill, for the management of moderate to severe pain, is a once-daily opioid.

CombinatoRx, the developer of the drug, received a $40 million milestone payment from Covidien for the approval of the drug, pushing up its stock almost 40% in midday trading to linger near $1.53.

"We are excited that our collaboration with CombinatoRx provides physicians and patients with the only extended-release hydromorophone treatment that will be available for this type of pain relief," said Timothy R. Wright, President of Pharmaceuticals at Covidien. "Building on more than a century of pain treatment experience, Covidien is focused on providing patients with access to advanced medications that expand the limits of pain therapy by combining proven drugs with innovative delivery systems."

Covidien will be responsible for the marketing, sales, and all post-approval regulatory filings for Exalgo, but it expects sales to peak at $200 million to $300 million for the drug. The company will be hiring another 150 sales representatives this year to handle the launch of the drug as well as the sales of its other pain medication, Pennsaid, which was approved in November.

"Exalgo is a branded opioid for pain which will participate in the multi-billion dollar extended release opioid market," wrote Leerink Swann analyst Rick Wise. "Along with Pennsaid, it helps dramatically strengthen and expand Covidien's branded pharma franchise, previously at less than $100 million in sales and about to face accelerating generic competition for its main product, Restoril."

Yet, Wise cautions that foreign exchange rates for the strengthening dollar and the burden of an expanded sales force could put some slight near-term pressure on the stock.

While this seems like a major positive for Covidien and CombinatoRx, the pain-medication sector can be tricky to navigate (IMS Health estimates the long-acting opioid category to be worth about $4.7 billion in sales in the 12 months ended November 2009). Pain Therapeutics (PTIE) and King Pharmaceuticals (KG) have been struggling to get their potentially "abuse-deterrent" opioid Remoxy approved.

King claims that Remoxy, as well as other opioids it has in the works, is harder to tamper with than the drugs currently on the market, thus making them less susceptible to abuse. Yet, the FDA and its panels haven't bought it. King claims that these drugs use various mechanisms that prevent abuse. One of its pills comes in a gel form that cannot be crushed for the purpose of snorting or dissolved in alcohol, while another becomes ineffective if crushed. The FDA has requested that the company provide more non-clinical data showing the drugs abuse-deterrent capabilities.

King Pharmaceuticals Chief Executive Brian Markison told investors at the JPMorgan Healthcare Conference in San Francisco earlier this year that King expects to resubmit Remoxy to the FDA in mid-2010.

King currently markets the pain medication Skelaxin, but will lose exclusivity on the drug in 2012. It also gained approval for Embeda, a medication that it gained through the acquisition of Alpharma in December 2008. Embeda was supposed to be abuse-deterrent, but studies have shown that addicts can still abuse the drug by crushing it and then injecting it.*

*Update: King says that kind of abuse would be futile for an addict, because it would not lead to euphoria levels.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE