In this work, we examine the behavior of pressure-transient data for single and multiphase flow in radially heterogeneous reservoirs. To illustrate multiphase flow behavior in these systems, we focus on heterogeneous gas-condensate reservoirs; however, we also consider other multiphase flow problems. It is well known(1) that in some instances, e.g., water injection/falloff in homogeneous reservoirs, pressure-transient data from buildup (or falloff) tests cannot be obtained by superposition of drawdown (injection) pressure responses. In fact, drawdown and buildup reflect properties in different regions of the reservoir. This behavior is common to most occurrences of multiphase reservoir flow and is exaggerated in the presence of radial heterogeneity. This theoretical work describes the information contained in transient pressure derivative data and explains the fundamental difference in behavior between multiphase drawdown and buildup pressure-transient data in radially heterogeneous reservoirs. We show that multiphase buildup data may be treated like single-phase buildup data, but drawdown data is most indicative of properties in that region of the reservoir where mobility is changing most rapidly with time.