Nice story.
I'm surprised that no mention is made of its clinical trials for treating Female Arousal Dysfunction. Potentially, that could double the candidates.
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Icos
The story at Icos Corp. (ICOS, news, msgs) is the company's Viagra-killer. A drug for male
erectile dysfunction, code-named IC351 and recently given the brand name of Cialis by Icos and
its partner Eli Lilly (LLY, news, msgs), is now in Phase 3 clinical trials that should be completed
by the end of 2000. Investors should be able to see the results of those trials next year, along
with an application to the Food & Drug Administration for the new compound.
But I don't think the stock is going to stay near its current $35 price until the Phase 3 trials are
completed. Phase II trials have shown that the drug has the potential to work better than Viagra.
Extrapolating from the reports so far, it seems that IC351 works faster than Viagra and lasts
longer. And IC351 so far has not caused the blue/green vision reported with Viagra. It seems that
the drug is clearly going to work, and clearly will be competitive with Pfizer's (PFE, news, msgs)
blockbuster.
The real question is about something called nitrate interaction. A significant percentage of the
male population using Viagra has heart conditions, and some of those patients with heart
conditions have died after using Viagra. If IC351 showed a significantly lower degree of nitrate
interaction than Viagra does -- and this is possible, because the drug relies on a different, more
specific mechanism than does Viagra -- then doctors would have an important reason to prefer it.
As Robertson Stephens' Jay Silverman put it in a May 1 report on the stock, "Cialis is a $500
million drug (in annual sales) without the nitrate benefit, and a $1 billion-$2 billion blockbuster with
it."
Eli Lilly and Icos have been keeping the nitrate interaction data very confidential, but I expect that
the story will get clearer as the year progresses. And I expect the story to get more publicity
through investment conferences, such as the upcoming Paine Webber growth and technology
conference, where Icos will present on June 7. I'd suggest starting to build a position in this one
sometime this summer with a target of $60 for early 2001. |
