$ sed 's/VALUES[[:blank:]]*/VALUES/g' input >output

$ sed 's/(VALUES)[[:blank:]]*/1/g' input >output

$ sed "s/($values)[[:blank:]]*/1/g" input >output

:%s/(VALUES)[[:blank:]]*/1/

sed -e 's/VALUES +/VALUES/'

$ cat file
stuff and VALUES    <--tab
more VALUES   <--three spaces
VALUES      <--tab, three spaces, tab

$ sed 's/VALUESs*/VALUES/' file
stuff and VALUES<--tab
more VALUES<--three spaces
VALUES<--tab, three spaces, tab