Vertex Pharmaceuticals Inc. ( VRTX - Snapshot Report ) recently said that the US Food and Drug Administration (FDA) has accepted the company’s new drug application (NDA) for its lead pipeline candidate, telaprevir. Telaprevir is being developed for the treatment of hepatitis C virus or HCV, for both treatment-naïve and treatment-failed patients.

The regulatory body also granted priority review status to telaprevir and has set a Prescription Drug User Fee Act (PDUFA) date of May 23, 2011. Vertex Pharma completed the submission of a rolling NDA to the FDA for telaprevir in November last year.

Moreover, Vertex Pharma stated that it has also completed a New Drug Submission to the Therapeutic Product Directorate of Health Canada, for the approval of telaprevir in Canada as a treatment for HCV. The Canadian regulatory body has also granted priority review status to the candidate, bringing down the review time to six - nine months from the standard 18 months.

The European Medicines Agency (EMA) accepted telaprevir for accelerated review in December 2010.

The company has joined hands with Johnson & Johnson ( JNJ - Analyst Report ) and Mitsubishi Tanabe Pharma for telaprevir. While Johnson & Johnson is responsible for the commercialization of telaprevir outside North America and the Far East, Mitsubishi Pharma will market it in Japan and certain areas of the Far East.

Neutral on Vertex Pharma

We currently have a Neutral recommendation on Vertex Pharma, which is supported by a Zacks #3 Rank (short-term Hold rating). With Vertex Pharma banking on telaprevir for growth, we believe that any delay in the approval of the candidate would weigh heavily on the stock. Moreover, we note that the HCV market is highly competitive with several small and large pharmaceutical companies working on clinical candidates.

The biggest potential competitor for telaprevir could be Merck & Co.'s ( MRK - Analyst Report ) boceprevir, a similar protease inhibitor molecule. Boceprevir’s NDA has also been granted priority review status by the FDA and EMA. Meanwhile, companies like Boehringer Ingelheim, Gilead Sciences Inc. ( GILD - Analyst Report ) and Roche Holdings Ltd. ( RHHBY ) , all have pipeline candidates for the treatment of HCV.