Source: Vertex Pharmaceuticals.

Wall Street has often proved to be overly optimistic about the financial results for Vertex Pharmaceuticals Incorporated (VRTX 0.20%). The biotech missed earnings estimates three out of the past four quarters. Vertex announced its 2015 first-quarter results after the market closed. Was it yet another miss or a pleasant surprise? Here are the highlights. 

By the numbers
Vertex reported revenue for the first quarter of $138.5 million. That reflected an increase of almost 17% over the $118.5 million in revenue from the same quarter of 2014. However, the figure fell below the consensus analysts' estimate of $142.38 million. 

Unsurprisingly, Vertex again posted a loss. During the first quarter, the company lost $198.7 million, or $0.83 per share. This improved on the loss of $232.5 million, or $1.00 per share, reported for the first quarter of 2014. However, Wall Street yet again proved to be too optimistic, with the average analysts' estimate calling for a net loss of $0.75 per share. On a non-GAAP basis, Vertex's net loss was $148.4 million, or $0.64 per share. 

Vertex kept a lid on costs more in the most recent quarter than it did a year ago. Research and development expenses fell to $215.6 million from $238.6 million in the same period of 2014. Selling, general, and administrative expenses also declined to $85.8 million from $74.2 million in the first quarter of the prior year.

As for the all-important cash position, Vertex had $1.2 billion in cash, cash equivalents, and marketable securities as of the end of March. That's down from $1.4 billion held at the end of 2014.

Behind the numbers
Despite another earnings miss, there was some good news. Kalydeco continued to show solid growth. The cystic fibrosis drug generated net product revenue of $130.2 million -- nearly 31% higher than the $99.5 million reported in the first quarter of 2014. The higher sales figure stemmed from the treating of more patients with the drug in the U.S. and the rest of the world.

Vertex's hepatitis C drug, Incivek, kicked in $8.3 million during the first quarter of 2015. However, that was a big decline from the $18.8 million in net product revenue for Incivek reported in the same quarter last year. Vertex stopped selling the drug in October because of the rise of newer, more effective hep C drugs from Gilead Sciences (GILD 0.91%) and others that have basically made Incivek obsolete. 

Several factors contributed to lower year-over-year expenses. The phase 3 study of Vertex's lumacaftor/ivacaftor combo (which will go by the tradename of Orkambi) completed in the first half of 2014. However, the company kicked off a phase 3 study of VX-661 in combination with ivacaftor earlier this year, which added some costs. Vertex also spent more for the planned commercial launch for Orkambi.

Looking ahead
There are several reasons for investors to keep a close eye on Vertex in 2015. Potential approval of Orkambi is the most obvious potential catalyst. The drug is under review by the FDA. If approved, it would be the first drug on the market to treat the underlying cause of cystic fibrosis for patients ages 12 and over with two copies of the F508del mutation. 

Another possible big development could come from the merger-and-acquisition front. Bernstein analyst Geoffrey Porges suggested recently that Gilead Sciences should make a play for Vertex. It's still a big "if" at this point as to whether Gilead or any other larger company will bid for Vertex, but it's not a far-fetched idea.

Vertex's latest earnings miss has made the company more affordable for a prospective buyer. Shares dropped over 1% during the day on Wednesday and traded more than 2% below the close during after-hours trading.