There are Food and Drug Administration applications that are just short of a formality because the phase 3 data is so clean: Both of Vertex Pharmaceuticals' drugs would fit into that category as would Amylin Pharmaceuticals' Bydureon on its third attempt.

Then there are drugs that are essentially lottery tickets. Their approval seems improbable -- Cell Therapeutics' (Nasdaq: CTIC) pixantrone, both last time and the upcoming time, whenever that is -- but the only way to know for sure is to file the marketing application with the FDA.

Depomed's (Nasdaq: DEPO) Serada, its treatment for menopausal hot flashes, falls a lot closer to the latter than the former category. Last October, Depomed said the phase 3 trial called Breeze 3 met only three of the four primary endpoints; it failed to reduce the frequency of occurrences at 12 weeks, although it did reduce the severity at that time point. The effect also didn't seem to last long; neither severity nor frequency were reduced at 24 weeks.

After meeting with the FDA last week, Depomed thinks it's worth the gamble to submit the marketing application.

Of course, the lottery ticket isn't cheap. The fees associated with the Prescription Drug User Fee Act run north of $1.5 million. And Depomed owes partner PharmaNova a $1 million milestone payment upon FDA filing. All told, Depomed expects the cost of filing and preparing for a potential approval to reach $5 million this year. Fortunately, the drugmaker can afford it. It expects to end the year with $88 million to $100 million in cash.

I'm doubtful of an approval because the FDA is pretty clear about a need to meet primary endpoints for a trial and would like evidence of long-term efficacy. But I wouldn't exactly call the filing a complete waste. Sure, the lottery ticket is expensive, but Serada's potential sales would exceed the Mega Millions jackpot. There's always the possibility that the FDA will accept a sum-of-the-parts approach, combining the data with the other two phase 3 trials. That strategy didn't work for InterMune (Nasdaq: ITMN), which presented positive combined data from two trials, only one of which succeeded.

But even if the FDA doesn't approve Serada, all is not lost. The easiest way for a company to understand exactly what it needs to do to gain approval is to get it in writing in a complete response letter from the FDA. Call it getting three numbers and covering the price of the ticket.

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