This Phase II study is being conducted in treatment-naive patients (no previous antiviral therapy for Hepatitis C infection) with genotype-1 chronic hepatitis C to evaluate the safety and effectiveness of valopicitabine alone and together with Pegylated Interferon (a drug approved by the Food and Drug Administration for the treatment of Hepatitis C infection).

Inclusion Criteria:

• Documented clinical history of genotype-1 chronic Hepatitis C and compensated liver disease
• Treatment Naive (patient has received no previous treatment for chronic hepatitis C infection)
• Other protocol-defined inclusion criteria may apply.

Exclusion Criteria:

• Patient is pregnant or breastfeeding
• Patient is co-infected with HIV or Hepatitis B
• Other protocol-defined exclusion criteria may apply.