Out of the Gate: Vertex Pharma Falls

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Out of the Gate: Vertex Pharma FallsThursday January 3, 10:54 am ET

Vertex Pharma Shares Drop As Analyst Says Telaprevir Launch Could Be Delayed to 2012

NEW YORK (AP) -- Shares of Vertex Pharmaceuticals Inc., which traded at two-year lows in recent days, slid in Thursday morning trading after a Wachovia analyst downgraded the stock, saying new tests may delay the launch of hepatitis C drug candidate telaprevir.

Farmer said recent trials have been flawed, and as a result, Vertex will have to conduct new trials to find the most effective doses of telaprevir. That could push the drug's launch back two years to 2012, he said, hurting sales by allowing competing drugs, like Schering-Plough Corp.'s boceprevir, to reach the market first. Farmer lowered his rating to "Underperform," or "Sell," from "Market Perform," or "Neutral." He said recent trial results indicate Vertex should run more midstage trials, or perform a late-stage trial with patients receiving treatment for up to 48 weeks. The stock fell $1.81, or 7.8 percent, to $21.34 in morning trading, and reached a low of $21.21. Vertex reported midstage results from a telaprevir trial in November. Dropout rates were high, and analysts were concerned by the drug's side effects, which included fatigue, rash, headache and nausea. "We believe the PROVE trial dropout rates support further Phase II dose exploration before justifying Phase III advancement," Farmer said.

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