(Adds background, details of second trial, Vertex sell-off, byline)

By Ransdell Pierson

NEW YORK, Oct 18 (Reuters) - Schering-Plough Corp <SGP.N> on Thursday reported promising results from a mid-stage study of its experimental hepatitis C drug, sending its stock higher and hurting shares of rival drugmaker Vertex Pharmaceuticals Inc <VRTX.O>.

Schering-Plough said the favorable early results for its drug, boceprevir, were seen in a Phase II trial of patients who had never previously been treated for their infections with the liver-damaging hepatitis C virus.

One group of patients received boceprevir along with Schering-Plough's widely used current dual therapy -- the injectable interferon drug Peg-Intron and anti-viral pill ribavirin. A second group received only Peg-Intron and ribavirin.

After 12 weeks of treatment, up to 79 percent of patients in the boceprevir group had undetectable levels of the virus in their bloodstreams, compared with 34 percent in the second group.

The company said the results, although encouraging, were only preliminary and that future trials would better clarify the drug's effectiveness.

Favorable preliminary results were also seen in a second mid-stage trial, which tested boceprevir among patients who had previously failed to benefit from existing treatments for hepatitis C, a virus believed to infect as many as 4 million people in the United States.

In the second trial, 7 percent to 14 percent of patients receiving boceprevir three times daily along with weekly injections of Peg-Intron -- either with or without daily doses of ribavirin -- had no trace of the virus after up to 48 weeks of therapy.

That compared with only 2 percent of such patients in another group who received only the standard combination of Peg-Intron and ribavirin.

"We need to design additional studies for this population so we can further help these hardest-to-treat patients," said Schering-Plough spokesman Robert Consalvo.

Consalvo said his company aims to begin selling boceprevir by 2010 if the drug succeeds in late-stage trials and is approved by regulators.

Vertex is developing a treatment for hepatitis C in the same protease inhibitor class as boceprevir. It has shown similarly impressive effectiveness in clinical trials among patients who have not been previously treated for the virus.

Schering-Plough shares rose 87 cents, or 2.7 percent, to $33.12 in morning trade on the New York Stock Exchange.

Vertex shares were down $6.05 to $29.77 in heavy Nasdaq trade. (Additional reporting by Lewis Krauskopf)

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