Viral kinetic models for hepatitis C virus (HCV) have generally assumed that the effectiveness of therapy in blocking virion production, epsilon, is constant. However, with pegylated interferon alpha-2b (PEG-IFN) given weekly, there are significant changes in drug concentration between doses that may lead to changes in drug effectiveness and viral rebounds towards the end of the dosing interval. Here we investigate the effects of using a model that assumes a constant effectiveness for studies involving PEG-IFN. We simulated PEG-IFN treatment in a population of 294 computer simulated 'patients', each characterized by a different set of pharmacokinetic and pharmacodynamic parameters. We then sampled the simulated treatment data over 4 weeks with a schedule similar to that used in viral kinetic studies, and fitted a viral kinetic model assuming constant drug effectiveness, the CE model, to that data. Although the CE model was able to fit to the data well in most cases, the parameter estimates obtained scattered widely both above and below the true values. Thus, this model is less useful to analyse HCV RNA data during therapy with PEG-IFN than with standard IFN given daily. With PEG-IFN accurate estimation of viral dynamic parameters necessitates concomitant measurements of serum viral load and drug concentration.