Failure is very profitable for Pain Therapeutics (PTIE) CEO Remi Barbier.
Barbier is pocketing more than $23 million in total compensation over the last 10 years while U.S. regulators have rejected his company's efforts to seek approval of an abuse-resistant opioid painkiller for the third time.
Pain Therapeutics shares are down 54% to $1.24 on Monday after the U.S. Food and Drug Administration decided once again that Remoxy, the company's painkiller product, could not be approved. The FDA last rejected Remoxy in 2011 and 2008.
During this time period, Pain Therapeutics' stock price has fallen 86%.
Barbier founded Pain Therapeutics in 1998 and has served as the company's only CEO and chairman. From this management perch, Barbier has failed for a decade to secure approval of his company's most important drug, yet he continues to be rewarded financially.
Since 2007, the Pain Therapeutics' board has paid Barbier $9.3 million in salary and bonuses. His salary alone has increased 55% to $835,000 per year over that time period, according to the company's proxy statement filed with the Securities and Exchange Commission.
The addition of stock and option grants pads Barbier's total compensation to more than $23 million since 2007.
Drug development is risky, and getting a drug successfully through the FDA review process is a challenge even for the best companies in the biotech sector. Still, Pain Therapeutics' serial incompetence when dealing with the FDA stands out.
Remoxy is an opioid co-formulated with a technology designed to prevent addicts from abusing the pill to get high. But Monday's latest FDA rejection focused on deficiencies found in Remoxy's abuse deterrence data, the company said.
The last Remoxy rejection in 2011 was due to problems with the drug's manufacturing process. After that setback, Pain Therapeutics lost its Big Pharma partner Pfizer (PFE) .
Pain Therapeutics said Monday that work will continue on Remoxy over the next year to collect new data necessary to resubmit to the FDA for the fourth time.Unless someone agitates for change, Barbier will continue to cash lucrative paychecks while shareholders shoulder losses.