According to this article in The Hollywood Reporter, Alex Flinn's Beastly is going to be made into a movie by CBS Films as early as 2009. I haven't read it yet because SOME library system hasn't gotten it yet (I am the only one who has it requested, too), but I thought it was a student who turns into the beast, not a teacher.
Update: I haven't seen any official pages for the movie, but Vanessa Hudgens is confirmed in her role and Alex Pettyfer is rumored to be starring opposite as Kyle (ie. the beast). The book is told from Kyle's perspective.
Next update: Mary Kate Olsen has been cast as the witch who casts the spell on Kyle. I can see it.
Update III: Neil Patrick Harris is playing the tutor!