Sometimes 84% premiums really are deserved.

Bristol-Myers Squibb's (NYSE: BMY) $735 million buyout of ZymoGenetics (Nasdaq: ZGEN) is looking a little less shocking after ZymoGenetics announced encouraging clinical trial results for its melanoma -- skin cancer -- treatment interleukin 21 (IL-21).

In the phase 2 trial, IL-21 produced a median survival of 12.4 months. The trial didn't have a control group, but that sure looks pretty good for stage 4 melanoma patients. By comparison, Bristol-Myers' own ipilimumab produced survival of 10.1 months compared to a control group that survived just 6.4 months. It's not a perfect comparison since different trials include and exclude different patient types, but the results certainly seem positive given the prospects for stage 4 patients.

The small size and the lack of a control means Bristol-Myers will likely have to run a phase 3 trial with a placebo control to get IL-21 approved. That would put it behind ipilmumap and Vical (Nasdaq: VICL), which expects phase 3 data for its melanoma treatment Allovectin-7 in the middle of next year, but there's plenty of room in the melanoma space given the current lack of options. Who knows, maybe ipilimumab and IL-21 could be combined to produce survival results that trumps either of the two individually.

And let's not forget that ZymoGenetics also has a phase 2 hepatitis C drug. If pegylated-interferon lambda can produce similar results to Roche's Pegasys and Merck's (NYSE: MRK) PegIntron with fewer side effects, $735 million is going to look like a steal. That'll make ZymoGenetic's marketed drug, Recothrom, resemble the parsley that comes with dinners at restaurants -- a nice garnish, but nothing close to the main course.

Matt Koppenheffer wonders if stocks really are cheap.

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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 disclosure policy.