Shares of Pain Therapeutics (NASDAQ:PTIE) are off 25% as partner Pfizer (NYSE:PFE) noted Thursday on its earnings call that Remoxy, PTIE’s lead product, is a “challenging” asset and that new studies are required to support resubmission of the drug in the U.S. Recall that many had expected Pfizer to resubmit the NDA for Remoxy in the near-term based on encouraging results from recently completed biostudies and an expected meeting with the FDA in 2H12. It is unclear whether PFE recently met with the FDA, but the large-cap pharmaceutical company is now saying that it will run 3 additional studies that are expected to complete in March 2013. At that time, Pfizer plans to meet with the FDA to discuss the results and whether they are adequate to address the concerns noted in the Complete Response Letter (CRL) issued by the agency in 2011. These words were not comforting and certainly dim prospects for good news for PTIE in the near term. Most troubling was PFE’s statement that it will make a “go/no-go” decision on the drug next year, indicating that Remoxy’s fate is still very much up in the air. A key driver of concern around this statement is based on the recently completed studies, which many thought were positive; the new question is why Pfizer feels that it is necessary to run more trials. Notably, PFE is also developing its own tamper resistant oxycodone product candidate, ALO-02, and while committed to abuse-resistant opioids, PFE could favor this formulation over Remoxy given much better economics. Expect the shares to trade down as investors seek to deploy investment capital elsewhere. This also applies to shares of Durect Corp. (NASDAQ:DRRX), given that a major portion of its value is tied to Remoxy as well. Note that PTIE has about $2.00 per share in cash, so this level should provide a backstop for the stock, but also indicates that downside off of today’s initial reaction could get worse.