Early this month, a release of competitors' data caused Vertex Pharmaceuticals'
Yesterday evening, Vertex and Merck
Vertex clearly has a lot more riding on this compound than Merck does. Merck is set to pay up to $350 million in milestones if MK-0457 makes it through trials and receives an FDA approval -- not to mention the royalties once the drug is on the market.
MK-0457 is part of Vertex's and Merck's collaboration to target Aurora kinase, a protein that's required for cells to grow and therefore a perfect target for anti-cancer compounds. One compound in the collaboration has been dropped because of a lack of efficacy, but the duo plans to start another, VX-689, in a phase 1 trial early next year.
Vertex's shares have been in steady decline since competitors like Schering-Plough
As my Foolish colleague Brian Lawler pointed out, there's still plenty of space in the HVC marketplace for multiple drugs. Combine the two partially unjustified drops in stock price, and you've got a drug developer with a serious markdown just in time for Christmas.
More Foolishness on tumors: