Vical's phase III study excludes melanoma patients with cancer that spread to their brain or liver, requires patients have normal LDH, good performance status and be chemotherapy naive. Melanoma patients with these baseline characteristics are relatively healthy.

This low-bar inclusion criteria for the Allovectin study, more than anything, explains why Vical has been forced to delay results. Once upon a time, Vical was supposed to have data from this study in mid-2011, then it was delayed into 2012 and now 2013. The assumptions made by Vical to design the study were wrong.

Vical bulls say: The unexpected longevity of the study means Allovectin works! The drug must be helping melanoma patients live a really long time.

No, what's happening is that all the patients in the study -- the Allovectin and the control arm patients -- are living a really long time. And when all patients live longer, it becomes exceedingly difficult for a drug to demonstrate a statistically significant improvement in overall survival.

I'm not going to dive back into the Allovectin phase II study results here but I've discussed them in the past. I don't see anything in the phase II data -- or Vical's previous phase III study with a lower dose of Allovectin that failed -- that gives me confidence in the ongoing trial.

Vical bulls disagree, of course. PropThink's Dee Kotak is a Vical bull so check out his argument for why the Allovectin study will succeed.

Two additional points:

1. If Vical manages to beat the odds and announce a positive survival benefit from the Allovectin study, the first question I'd ask is about subsequent therapy. Two melanoma drugs with proven survival benefits -- Roche's ( RHHBY) Zelboraf and Bristol-Myers Squibb's ( BMY) Yervoy -- have both been approved during the conduct of the Allovectin study. It's likely that a good number of patients in Vical's study received treatment with Zelboraf or Yervoy after Allovectin. That's problematic if treatment with either Zelboraf or Yervoy isn't balanced across both arms of the study.

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