Biotech Notebook: Vertex, Medicines Co.

Will Vertex Pharmaceuticals (VRTX Quote) seek regulatory approval for its hepatitis C drug candidate telaprevir in 2009 -- one year earlier than Wall Street expects -- based on the positive results from the PROVE 3 clinical trial announced Monday?

That's the question most on the minds of Vertex investors, and one that I debated back and forth Monday with my colleague Justin Ferayorni in the Columnist Conversation section of RealMoney.com, a sister site to TheStreet.com.

For starters, we agreed that the telaprevir data in treatment-resistant hepatitis C patients were really impressive. Justin went further, predicting that Vertex could get telaprevir approved early based on these data because "these tough [patient] populations with objective endpoints (viral load reduction can be quantified) tend to have a low bar at the FDA."

Justin went on to make the point that the Food and Drug Administration moved quickly to approve new antiviral drugs for desperately ill HIV patients back in the mid-1990s. The situation with telaprevir in treatment-resistant hepatitis C patients is similar, which could prompt the FDA to be extra accommodating.

In response to Justin's comments, I said I wasn't as optimistic about an early FDA filing for telaprevir, despite my belief that the PROVE 3 data are great -- and strong enough for approval. (Assuming final data are as good as the interim look we got Monday.)

Unfortunately, the FDA doesn't ask my opinion, and these days, the agency seems so risk averse and unwilling to move with alacrity on anything that I fear regulators are likely to ask Vertex to run a phase III study before filing for approval. The PROVE 3 study is well-designed for a phase II trial, but for a phase III study, it's probably smaller than what regulators are comfortable with. It's also not entirely blinded between the treatment and control arms, which will make the FDA nervous.