Vertex cystic fibrosis combo meets study goals
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Vertex Pharmaceuticals ' stock soared Tuesday after studies showed that a new combination of drugs from the company met the goals of two late-stage clinical trials in cystic fibrosis, setting the stage for Vertex to apply for regulatory approval in the fourth quarter. At one point, the stock was trading at its highest level since October 2000. (Click here for the latest price.) The medicines, Kalydeco and lumacaftor, improved lung function by an average of 2.6 to 4 percentage points from patients' baseline levels versus placebo, Vertex said in a statement Tuesday. The studies, dubbed Traffic and Transport, were from the third and final phase generally required for approval.

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Vertex Pharmaceuticals' headquarters in South Boston. Dina Rudick | The Boston Globe | Getty Images

The results were among the most anticipated events in the biotechnology industry this year, analysts said. They projected Vertex's stock, which closed at $66.61 Monday, could rise above $100 on positive results, or sink to the $40s on negative results. They also said the data could have broader industry implications. Read MoreThe next UK pharma takeover target may be… "Given that Vertex is one of the largest companies in the space, the results of Traffic/Transport will have a significant effect on sentiment for biotech," Ravi Mehrotra, an analyst with Credit Suisse , wrote in a research note before the data were released. In 2012, Vertex received approval for Kalydeco—the first medicine to address the genetic cause of cystic fibrosis, a rare, inherited disease that causes buildup of sticky mucus in the airways and other areas, and is often fatal by age 40. Cystic fibrosis affects about 70,000 people worldwide, according to the Cystic Fibrosis Foundation, which contributed to the development of Vertex's cystic fibrosis drugs. Read MoreInvestors eyeAchillion for next big pharma deal While Kalydeco was a breakthrough for cystic fibrosis patients, it only addresses mutations possessed by a fraction of the population. Vertex is testing it in combination with lumacaftor, still an experimental medicine, to address more patients; study results published Tuesday were in a patient population that accounts for about 40 percent of the total population, Mehrotra said. Kalydeco drew $371 million in 2013 revenue. In total, Vertex's cystic fibrosis medicines may draw more than $5 billion in annual revenue by 2018,according to estimates earlier this year from Phil Nadeau, an analyst with Cowen & Co.

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