Medarex (NASDAQ:MEDX) and Bristol-Myers Squibb (NYSE:BMY) are headed off to Vegas. They're planning to submit a marketing application for their skin cancer drug, ipilimumab, which contains unspectacular data. But with the trials already complete, it seems like a gamble worth taking.

The duo released data from three trials testing ipilimumab in patients with advanced skin cancer. These patients are very sick and have failed a previous therapy, so the FDA doesn't require much to get the drug approved. Looking at the range of patients who respond, the lower confidence level needs to exceed 10%. Unfortunately, ipilimumab didn't make the cut in one of the trials, and the trial failed its primary endpoint.

There was some positive news, though. In one of the trials, there was an unequivocal dose response to the drug. That is, as the drug level was increased, more patients responded.

Here's the take-home message from the press release: The good news is that the drug works; the bad news is that it doesn't work in many people. Data like that probably won't cut it with the new, stricter FDA.

In a follow-up study, there was some response to the drug even in subjects who didn't respond early on in the study. Dr. Geoff Nichol, senior vice president of product development at Medarex, suggested that this "may reflect the unique sort of profile of this drug with a somewhat slower onset of action and a longer duration of effect compared with traditional treatments such as chemotherapy." That sounds like a testable hypothesis to me, but in marketing applications, the FDA loves to see the results of hypotheses -- it's not a fan of them as explanations for data.

Even if the FDA rejects the marketing application, the drug is far from dead. Ipilimumab is currently being tested as a front-line skin cancer treatment. The trial compares ipilimumab in combination with the chemotherapy DTIC versus DTIC alone, and should complete enrollment next quarter. Because the endpoint is progression-free survival, the results could be available before the end of next year.

I think it's likely the FDA will reject the marketing application for advanced skin cancer, but given that the companies are only risking the PDUFA fees, it is certainly a gamble worth taking. There aren't a whole lot of options for patients with advanced skin cancer, and the FDA might be willing to approve the drug for the sake of the few patients who do appear to benefit.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. The Fool has a time-tested disclosure policy.