Pain Therapeutics, Inc. (NASDAQ:PTIE) Rebounds from Loss of Pfizer Collaboration

Pain Therapeutics, Inc. (NASDAQ:PTIE)

Austin, TX-based Pain Therapeutics, Inc. (NASDAQ:PTIE) is up over 58% in the pre-market on large volumes. This morning the biotech firm announced it has secured positive guidance from the Food and Drug Administration (FDA) for it lead drug candidate Remoxy ER – an opioid. This news points to an expedited path towards the company’s resubmission of a New Drug Application (NDA). The NDA will be coup for the small biotech firm after Pfizer (NYSE:PFE) ended their development agreement in 2013. That news sent PTIE shares down over 50% – their largest one-day decline ever at the time.

On February 13, 2017 a meeting was held between Pain Therapeutics, Inc. (NASDAQ:PTIE) and the FDA. In that meeting a decision was reached that Remoxy ER posed no safety or efficacy risks to the public. However, it was decided that further study was warranted to assess potential abuse of the drug. It is estimated that the studies will cost Pain Therapeutics, Inc. (NASDAQ:PTIE) an estimated $3-$4 million. Pain Therapeutics reported $18.7 million in cash-on-hand in their 2016 financials. Expenses for 2016 totaled $12.6 million.

Pain Therapeutics, Inc. (NASDAQ:PTIE) has a novel approach to deterring abuse. Remoxy ER is produced as a thick gel. This makes it difficult for possible abuse to occur through the normal forms such as smoking or snorting. The FDA considers it important for opioid developers to address the abuse and addiction that have accompanied new drugs. Each day, an average of 91 American lives are lost through opioid addiction.

Pain Therapeutics, Inc. (NASDAQ:PTIE) has a 52-week low of $0.51 and a 52-week high of $3.00. Insider ownership is listed at 23.4% and institutions own over 42% of PTIE shares. Importantly, the number of outstanding PTIE shares has remained stable since 2012. The lack of dilutive share offerings should attract mainstream investors who may normally shy away from a biotech firm that has posted no sales since 2013 ($41.1 million). In 2012 the number of outstanding PTIE shares was 44.75 million. That number was listed at 45.64 million at the end of 2016.

Pain Therapeutics, Inc. (NASDAQ:PTIE) is also developing a small-molecule drug for Alzheimer’s patients. In July of 2015, Pain Therapeutics received a $1.5 million grant from the National Institutes of Health for development of their small molecule drug candidate PTI-125.

Only one firm follows Pain Therapeutics, Inc. It rates PTIE shares a “Hold” with a price target of $2.50.

3/21/2017
Ticker Symbol PTIE
Last Price a/o 7:55 AM EST  $                      1.06
Average Volume                    408,350
Market Cap (mlns)  $                    31.36
Sales (mlns) $0.00
Shares Outstanding (mlns) 46.12
Share Float (mlns) 33.66
Shortable Yes
Optionable Yes
Inside Ownership 23.38%
Short Float 2.43%
Short Interest Ratio 2
Quarterly Return 10.01%
YTD Return 19.26%
Year Return -67.46%

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading.

Author: Steve Clark

Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

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