Vertex Pharmaceuticals ( VRTX) is pushing ahead with an aggressive drug development plan that, if successful, will drastically improve how hepatitis C is treated across the world -- and make boatloads of money for the company and investors in the process.

If Vertex stumbles, however, the blowup will be spectacular, even by biotech standards.

The drug in question is called telaprevir. Vertex is in the midst of an ambitious phase II clnical study program that will yield crucial data over the next 10 to 12 months.

Most importantly, we'll soon know whether: 1) telaprevir can shorten treatment time for most hepatitis C patients to as little as three months, compared with about a year for current treatments; and 2) whether telaprevir can boost cure rates for hepatitis C patients to 70% to 80% or higher from about 50% today.

If the telaprevir pill can achieve all that, the drug might easily generate $2 billion to $3 billion in revenue and could double or even triple the value of Vertex shares, which closed Monday at $32.52. Likewise, the downside risk is eye-popping: Wipe telaprevir off Vertex's map, and the stock could head quickly back to the teens.

While Vertex has other drugs in the oven, the company's near-term fortunes are tied tightly to telaprevir, which is why investors need to pay attention to the outcomes of these ongoing clinical trials, which the company has dubbed PROVE 1 and PROVE 2.

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