Biotech Winners: King Pharmaceuticals, Pain Therapeutics
(Biotech winners and losers item updated for stock closing stock prices.)
NEW YORK (TheStreet) -- Pain relief became the theme of Tuesday's trading session in biotech land, after Pfizer's (PFE) $3.6 billion deal to acquire King Pharmaceuticals (KG), a pain-reliever specialist, came to light before the opening bell.
The news drove King's stock to the cusp of Pfizer's offer price -- the equivalent of $14.25 a share, a 40% premium to the Monday close. Shares of the Bristol, Tenn.-based King, which also does a robust business in veterinary medicine, ended trading at $14.14, up 39%, or $3.99. More than a quarter of a billion King shares changed hands Tuesday, almost 100 times the daily average.
The deal also helped the shares of an early-stage painkiller developer with a rather literal name: Pain Therapeutics (PTIE), which has teamed with King on the development of Pain's lead drug candidate, called Remoxy, currently in clinical trials.The two companies also have a licensing agreement for Remoxy, a "strong painkiller," Pain says in its press materials, the main selling point of which appears to be that it has a "unique formulation designed to reduce potential risks of unintended use." In other words, the Remoxy recipe, delivered as a capsule, makes it hard for users to binge on the drug and get addicted to its painkiller qualities. Investors and traders were apparently excited by the notion of a global Pfizer sales and marketing force pushing Remoxy into the dreamed-for blockbuster realm. King was slated to submit a new drug application for Remoxy with the Food and Drug Administration sometime during the fourth quarter. Pain shares closed Tuesday up 18.6% to $7.41. Volume exceeded one million shares, 14 times the daily average turnover in this normally lightly traded name. Similarly, investors bid up shares of Acura Pharmaceuticals (ACUR) in light of the company's partnership with King to develop another pain reliever meant to prevent abuse. Acura shares, also fairly illiquid, ended the day up 12% to $2.55.
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