About That Stellar Data ...

It's all relative.

That couldn't be truer for Vertex Pharmaceuticals' (Nasdaq: VRTX  ) phase 2 trial combining VX-809 and Kalydeco in cystic fibrosis patients. Earlier this month, the company reported that 46% of patients had a 5-percentage-point improvement in forced expiratory volume in one second, FEV1, a measure of lung function. The biotech also said 30% of patients improved by 10 percentage points.

Turns out, while they were presented as absolute improvements, those numbers were actually relative to placebo, which inflated the numbers because the placebo group's lung function decreased. The number of patients taking the combination that actually improved 5 or 10 percentage points on an absolute basis was 35% and 19%, respectively.

Vertex blamed the issue on a misinterpretation of the data that it received from a contractor responsible for doing the statistical analysis. That's certainly better than being accused of having employees who faked data, like Sequenom (Nasdaq: SQNM  ) , although it still shouldn't happen.

Let's not forget that this was interim data from a trial with a mere 58 patients, 37 of whom got the drug combination. The data was likely to change anyway, something that investors in Celldex Therapeutics (Nasdaq: CLDX  ) and in companies presenting preliminary data at the American Society of Clinical Oncology annual meeting next week should remember.

Vertex's new data certainly doesn't look as good as it did before, but given how much of a game-changer the combination is for the treatment of cystic fibrosis, whether the drug works is a lot more important than how well it works. If the combination improves lung functions, cystic fibrosis patients will take it because there aren't any other options, besides drugs such as Gilead Sciences' (Nasdaq: GILD  ) Cayston and Novartis' (NYSE: NVS  ) Tobi that treat the symptoms of lung infections.

The decrease in placebo group might not be reproducible, but even ignoring that, VX-809 and Kalydeco caused a mean improvement of 4 percentage points in FEV1. If the combination can hit that number in the phase 3 trial, Vertex shouldn't have any problems getting it on the market and quickly reaching blockbuster status.

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Fool contributor Brian Orelli holds no position in any company mentioned. Check out his holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Vertex Pharmaceuticals and Gilead Sciences. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


Read/Post Comments (6) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 29, 2012, at 9:56 PM, unkownuser wrote:

    Hey Brian,

    How old is that Sequenom incident you mention? You should check your current events before you start slinging dirt around. That is ancient history with regard to Sequenom; the management team was replaced long ago, and the news is SO OLD that the responsible person (who was also fired and replaced) has even passed away.

    Talk about digging up the dead. Why don't you write a defamatory piece on Holland, and bring up tulipmania; in your world that would probably be current events.

    Geez... what a worthless doosh ur!

  • Report this Comment On May 29, 2012, at 10:17 PM, unkownuser wrote:

    Here is a good one, when asked:

    So you have no formal training in finance?

    Brian Orelli replies:

    No, everything I’ve learned has been from books or websites.

    Link here:

    http://www.babybiotechs.com/about/

    This is who MF hires to write, people who admittedly have no financial experience whatsoever. What a great country we live in!

  • Report this Comment On May 29, 2012, at 10:44 PM, megastockmaster wrote:

    Whoah! Sequenom has employees who are accused of faking data. I should probably stay away from the stock, then... in 2009. Those employees were fired in Sep 2009.

    For this writer, the more things change, the more they stay the same.

    I knew MF has been writing some hack pieces to go after SQNM, but this reaches a new low in credibility.

  • Report this Comment On May 30, 2012, at 1:12 AM, allen95677 wrote:

    It's all relative.....and this article along with the author are irrelevant. Brian is a hack and it's hard to believe someone pays him for his worthless opinion.

  • Report this Comment On May 31, 2012, at 6:42 AM, portefeuille wrote:

    those numbers were actually relative to placebo

    --------------

    They were not "actually relative to placebo". See comment #151 here -> http://caps.fool.com/Blogs/fund-trades/735522.

  • Report this Comment On June 01, 2012, at 11:03 PM, portefeuille wrote:
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