DURECT Corporation (NASDAQ:DRRX) is watching its shares tank nearly 30% in Monday’s session after receiving a Complete Response Letter from the U.S. Food and Drug Administration (FDA) for Pain Therapeutics’ New Drug Application (NDA) for REMOXY® ER (oxycodone) extended-release capsules CII. Based on its review, the FDA has determined that the NDA cannot be approved in its present form and specifies additional actions and data that are needed for drug approval.

In a press release issued this morning by Pain Therapeutics, Pain Therapeuticsstates that “The CRL focuses on the abuse-deterrent properties of REMOXY ER and proposed drug labeling.  The CRL makes no mention of clinical safety, drug efficacy, manufacturing, stability, bioequivalence or any other issues from a prior Complete Response Letter.”

The announcement continues that “Pain Therapeutics is evaluating the CRL and plan further discussions with the FDA.  The CRL specifies additional actions that are needed in order to obtain approval of REMOXY ER with label claims against three routes of abuse (i.e., injection, inhalation and snorting).  These actions may take approximately a year to conduct and may cost approximately $5MM, pending discussions with the FDA and outside clinical/regulatory consultants.”

In addition, the Pain Therapeutics provides the following details of the Complete Response Letter (CRL):

“The CRL focuses on the actions and studies that are needed in order to obtain approval of REMOXY ER with label claims on three routes of abuse (i.e., injection, inhalation and snorting). In conducting the following studies, we will generally compare REMOXY ER vs. one or more commercially available oxycodone ER drug product:

  • To support a potential drug label claim against abuse by injection: Repeat an injectability/syringeability study using thin films of drug, smaller volumes of solvents, additional mixed solvents and alternative extraction methods and syringe filter.
  • To support a potential drug label claim against abuse by inhalation:Repeat a volatilization study using the same thickness for each drug to increase surface area.
  • To support a potential drug label claim against abuse by snorting: Conduct an intranasal abuse potential study in human volunteers (i.e., not the animal data we had submitted) with drug applied directly inside the human nasal cavity.

In addition, we had proposed in the REMOXY NDA a label claim against abuse by chewing.  Our proposal was based on clinical results of an oral human abuse potential study that met all four co-primary endpoints with statistical significance and that also met several, but not all, secondary endpoints.  The CRL asks us to submit a revised proposed label to indicate results of this study do not support a label claim against abuse by chewing.” (Original Source)

On the ratings front, H.C. Wainwright analyst Ram Selvaraju reiterated a Buy rating on DRRX, with a price target of $4, in a report issued on August 3. The current price target represents a potential upside of 135.3% from where the stock is currently trading. According to TipRanks.com, Selvaraju has a yearly average return of 4.4%, a 50.5% success rate, and is ranked #586 out of 4183 analysts.

DURECT Corp. is a specialty pharmaceutical company, which engages in development of pharmaceutical products for pain and chronic diseases based on its proprietary drug delivery technology platforms. It manufactures and sells osmotic pumps used in laboratory research, and designs, develops and manufactures a wide range of biodegradable polymers and excipients for pharmaceutical and medical device clients for use as raw materials in their products. The company also conducts research and development of pharmaceutical products in collaboration with third party pharmaceutical and biotechnology companies.