Pain Therapeutics Reports Operating Results (10-K)
Pain Therapeut has a market cap of $266.6 million; its shares were traded at around $6.24 with and P/S ratio of 13. Hedge Fund Gurus that owns PTIE: Jim Simons of Renaissance Technologies LLC. Mutual Fund and Other Gurus that owns PTIE: Mario Gabelli of GAMCO Investors, Mario Gabelli of GAMCO Investors.
Highlight of Business Operations: The aggregate market value of the voting and non-voting common equity held by non-affiliates was $198,076,462 computed by reference to the last sales price of $5.56 as reported on the NASDAQ Global Select Market, as of the last business day of the Registrants most recently completed second fiscal quarter, June 30, 2010.
We also conduct basic research in collaboration with academic and other partners. Our research and development expenses were $45.8 million in 2008, $21.1 million in 2009 and $15.7 in 2010. We recorded contract revenue related to customer-sponsored research activities under our collaboration with King of $29.4 million in 2008, $6.2 million in 2009 and $1.3 million in 2010.
In 2005, we entered into collaboration agreement and a license agreement with King to develop and commercialize REMOXY and other abuse-resistant opioid painkillers. King made an upfront cash program fee payment of $150.0 million to us at the closing of this strategic alliance in 2005 and another upfront cash program fee payment of $5.0 million to us in June 2010 in connection with an amendment to the strategic alliance. Pfizer plans to complete its acquisition of King in late February 2011. We believe Pfizers acquisition of King may facilitate REMOXYs commercial success if REMOXY is approved.
We will receive a $15.0 million cash milestone payment from King upon regulatory approval of REMOXY in the United States. In January, 2011, we received $5.0 million for the acceptance by the FDA of the IND for abuse-resistant oxymorphone. In 2008, we received $15.0 million related to acceptance by the FDA of the NDA for REMOXY, and $5.0 million of acceptance by the FDA of the IND for abuse-resistant hydrocodone. In 2006, we received $5.0 million for the acceptance by the FDA of the IND for abuse-resistant hydromorphone. We could also receive from King up to $105.0 million in additional milestone payments in the course of clinical development of the other abuse-resistant opioid painkillers under the strategic alliance. In addition, subject to certain limitations, King is obligated to fund development expenses incurred by us pursuant to the collaboration agreement.
We have an exclusive, worldwide Development and License Agreement, or the Durect Agreement, with Durect Corporation, or Durect, to use a patented technology that forms the basis for a number of oral gel-cap drug candidates, including REMOXY. We reimburse Durect for formulation and related work, and make milestone payments based on the achievement of certain technical, clinical or regulatory milestones. Aggregate payments to Durect from the inception of the Durect Agreement in late 2002 to December 31, 2010 were approximately $35.8 million. We paid Durect $1.0 million in upfront payments under the Durect Agreement and $1.7 million for achievement of certain clinical and regulatory milestones. We could pay up to another $7.6 million of potential payments under the Durect Agreement following achievement of certain clinical and regulatory milestones. We have sub-licensed to King certain rights to develop and to commercialize REMOXY and certain other opioid drugs formulated in part with technology we licensed from Durect. King is obligated to reimburse us for all expenses for formulation and related work and for milestone payments we incur under our agreement with Durect.
We have licensed certain technology, including technology that we use in our monoclonal antibody program for the treatment of metastatic melanoma, from AECOM pursuant to a License Agreement, or AECOM Agreement. Under the AECOM Agreement, we have a worldwide exclusive license to the technology underlying the AECOM Agreement and all intellectual property rights arising from such technology. The AECOM Agreement requires us to pay AECOM up to $8.0 million in milestone payments, based on certain clinical development and commercial milestones, and royalties of 4% based on sales of licensed products If a product utilizing technology licensed under the AECOM Agreement is combined with a drug or other substance for which we are paying an additional royalty, the royalty that we pay to AECOM will be reduced by up to one-half based on the amount of such additional royalty. In connection with the AECOM Agreement, we also issued a warrant to purchase up to 150,000 shares of our common stock at an exercise price of $6.77 per share, with vesting subject to certain commercial milestones. This warrant expired unvested in January 2010. Aggregate payments to AECOM from the inception of the AECOM Agreement to December 31, 2009 were approximately $2.0 million, inclusive of an up-front payment of $200,000. We have not yet made any milestone payments to AECOM under this agreement.
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