America is in the midst of an opioid epidemic, and Egalet Corp. thinks it can help.

The Wayne company has developed technology that makes it harder for prescription painkillers to be altered for a quick high.

The company's "abuse-deterrent" technology arrives at an auspicious time; the federal government is calling for stricter guidelines governing the distribution of opioids, and many companies are trying to find the right niche as new rules are developed.

Egalet is one of more than a dozen companies working on abuse-deterrent formulations of oxycodone, hydrocodone, and morphine, and its stock has been on a wild ride.

Egalet's stock was the best performer among Philadelphia-area publicly traded companies last year, but hit a 52-week low in March, a sign of how volatile a small pharma stock can be.

What is unique about Egalet's process is its plastic-like injection technology, similar to what is used to manufacture bottle caps and car bumpers. It produces tablets that cannot be broken into small particles to chew, crush, or dissolve.

Attempts to melt the pills result in a goopy gel too thick to get into a syringe to inject. But if swallowed normally, the pills erode gradually in the gastrointestinal tract.

Combatting opioid dependence and overdose "is a complex problem," said Jeffrey Dayno, a neurologist and Egalet's chief medical officer. "We don't think abuse-deterrent formulations are the only solution, but we certainly believe they should be part of the solution."

Prescription painkillers have come under scrutiny because addiction and overdose deaths have reached epidemic levels, according to the Centers for Disease Control and Prevention. Sales of prescription opioid painkillers quadrupled since 1999.

The Food and Drug Administration on March 24 released draft guidelines for manufacturers to develop less-costly generic versions of abuse-deterrent prescription opioids.

Currently, the opioid medicines with abuse-deterrent features are brand-name drugs that can carry higher co-payments, such as $20 to $30, rather than $5 for a generic, depending on the insurance plan.

"The FDA looks forward to the day, hopefully soon, when the majority of opioids in the United States are marketed in effective abuse-deterrent forms," FDA commissioner Robert Califf told reporters on a conference call.

"Abuse deterrent doesn't mean abuse proof," cautioned Douglas Throckmorton of the FDA's Center for Drug Evaluation and Research. "There is not yet technology to prevent opioid abuse" by taking more than one pill, or more than prescribed. "There may always be some potential for abuse."

Most addiction begins by swallowing pills whole, said Andrew Kolodny, director of Physicians for Responsible Opioid Prescribing. "If all our opioids were harder to crush for snorting or injecting, that would be a good thing," he said. "But it doesn't make a very big dent in an addiction epidemic because the drugs are not less addictive."

The FDA said it will not remove older opioids from the market until it knows whether the new products reduce abuse. Companies will be required to conduct follow-up studies to measure "the real-world impact" of their products, the FDA said.

The CDC last month issued new voluntary standards, urging doctors not to prescribe opioid alternatives for chronic pain other than for cancer, palliative, and end-of-life care.

When prescribing opioids, physicians were advised to use the lowest possible effective dosage and to limit the quantity, the CDC said.

The FDA has approved five opioids with abuse-deterrent features, and may approve as many as five more - including Egalet's first product - in the next 12 months, said Ken Trbovich, a specialty pharmaceutical analyst with Janney Montgomery Scott in Philadelphia.

Egalet's Arymo, an extended-release, long-acting morphine tablet, has been accepted for review by the FDA. If approved, Arymo would be manufactured by Halo Pharmaceutical in Whippany, N.J., and could be available by the end of the year, the company said.

"There is significant interest from the pharmaceutical industry in developing abuse-deterrent opioids," Trbovich wrote in a client note. "But our analysis reveals they are not all equal. We think some are in a better position than others. . . . We think Egalet will be successful with Arymo."

Trbovich said that regulatory approval could be slowed because the FDA is reviewing a number of applications for abuse-deterrent opioids. The FDA division for anesthesia, analgesia, and addiction products "has been stretched thin" and may not act "as swiftly as it normally would," he said.

Chiara Russo, specialty pharmaceuticals analyst at Cantor Fitzgerald, said Egalet's technology, has the "potential to be a best-in-class" formulation. The technology "creates an extremely hard, plastic-like material that has proven to be very difficult to manipulate using physical or chemical means," she wrote in a client note.

Egalet was founded in Vaerlose, Denmark, where researchers in the late 2000s discovered that the injection molding technology when mixed with the active opioid ingredient had "very robust abuse-deterrent" properties," said Robert Radie, Egalet's president and chief executive officer.

Given that the majority of opioid abuse occurs in North America, especially in the United States, Egalet moved its headquarters to Wayne.

Radie, the former CEO of Topaz Pharmaceuticals in Horsham, became Egalet's first U.S. employee in March 2012.

"There wasn't any reason not to base the company here," Radie said, at the company's new offices on Lee Road. The Philadelphia region is a hotbed for biotechnology and pharmaceutical development. "It was home to me, so it made sense to have the U.S. headquarters here."

Egalet has about 50 employees in Wayne, 25 in Denmark, and a sales force of 71 who work on contract.

"We expect to continue to grow," Radie said. "We continue to build out our manufacturing capabilities and support functions for our commercial efforts and sales."

Egalet is developing a second abuse-deterrent drug, Egalet-002, an extended-release oxycodone, currently in Phase 3 patient testing.

The company is also working on an attention deficit hyperactivity (ADHD) stimulant drug with the same heat and pressure technology to create a crush-resistant pill. ADHD pills are also prone to abuse.

Last year, Egalet acquired two commercial products that are being sold to treat pain:

Oxyado is an immediate-release abuse-deterrent oxycodone that can cause a burning sensation if someone tries to crush and snort it.

Sprix nasal spray is a nonsteroidal anti-inflammatory drug (NSAID) - not an opioid - being marketed for short-term treatment of moderate to severe pain.

Charles P. O'Brien, a physician and addiction specialist at the University of Pennsylvania, said he welcomed "any method that could reduce the likelihood of abuse.

"The way that a drug is taken is a big factor in the abuse liability and the propensity to become addicted," he said. Many drugs, not just opioids, are abused including attention-deficit medications for children through snorting, crushing, dissolving, or injecting to get "more rapid onset, pleasure, and euphoria.

"I think this is a good idea," O'Brien said, about efforts to create abuse-deterrent medicines. "My position is it's good to try it. Good luck."

lloyd@phillynews.com

215-854-2831@LoydLinda