Adolor, Pfizer Ink R&D Deal

Updated from 8:49 a.m. EST

Adolor(ADLR Quote) shares shot higher early Wednesday on news of a new partnership with Pfizer(PFE Quote) under which the small-cap drugmaker and Big Pharma company will develop two compounds for pain conditions.

Amid expiring patents and other pressures, big pharmaceutical companies have been recently hungry for R&D and portfolio-expanding opportunities. Pfizer on Friday commenced its offer for the outstanding shares of Coley Pharmaceutical(COLY Quote). And GlaxoSmithKline(GSK Quote), which bought Reliant Pharmaceuticals less than a month ago for $1.65 billion, announced a research and development deal earlier this week with Santarus(SNTS Quote).

Exton, Pa.-based Adolor is already co-developing its lead product candidate, Entereg, with Glaxo. Entereg is designed to block the side effects of opioid analgesics on the gastrointestinal tract without affecting analgesia. After hiccups in development, Adolor announced a week ago that the Food and Drug Administration's Gastrointestinal Drugs Advisory Committee will review the new-drug application (NDA) for Entereg on Jan. 23.

"We believe investors' attention has been almost entirely focused on Entereg and its prospects, with very little value attributed to the delta program," noted Cowen and Co. analyst Leland Gershell in a Thursday morning brief. "Hence, this partnership comes as an unexpected positive and shares will be strong on the news."

The Adolor compounds central to the Pfizer deal announced today are proprietary Delta opioid receptor agonist candidates designed to treat inflammatory, neuropathic and acute pain conditions. Adolor said in a Wednesday morning conference call that in earlier trials the Delta receptor allowed it to provide analgesia without some of the limiting side effects known to this class.