The planet was a protoplanet and uninhabited. The Paxans claimed and terraformed it for colonization, making it a Class M planet. Its location was ideal for concealing their whereabouts. The Paxans also set up a trap near the planet involving a wormhole near the planet in order to goad visiting ships into a scenario where they would move away without investigating.
Ironically, the unusual nature of the planet prompted the USS Enterprise-D to investigate it in 2367. The Paxans' trap did not work with the positronic brain of Commander Data, however, the two parties cooperated to fix the situation, and Starfleet eventually did not learn of the significance of the planet. (TNG: "Clues")