Move Over, Viagra; Icos Is the New Stud on Wall Street

BOTHELL, Wash. — Shares of Icos Corp., a biotechnology company with no products on the market, soared 30% on Friday on enthusiasm about its impotence drug, which may rival Pfizer Inc.’s blockbuster Viagra.

Icos, whose biggest shareholder is Microsoft Corp. Chairman Bill Gates, with a 13% stake, is only starting the second of three phases of testing needed to get regulatory approval for its impotence drug.

Pfizer’s Viagra, the first pill for impotence, took off when it was introduced last month because it is easier to use than previous treatments.

“There’s little doubt that Icos’ drug for impotence is effective, but they still have to go through all the trials to prove it’s safe,” said Andrew Heyward, an analyst with Ragen MacKenzie, who has an “accumulate” rating on Icos.

The drug, which may produce fewer side effects than Viagra, could go into the final phase of testing by the end of the year, analysts said.

Lacy Fitzpatrick, associate director of investor relations for Icos, said its drug, which doesn’t yet have a brand name, could be ready for marketing in 2000.

BusinessWeek’s “Inside Wall Street” column Thursday touted Icos for its experimental impotence drug IC351 and said the stock was worth double its current price.

Icos shares rose $4.81 to close at $21.06 in Nasdaq trading of 23 million shares Friday, more than 100 times the three-month daily average, making it the most active stock in U.S. trading. It hit an all-time high of $24.50, valuing the company at almost $1 billion.

Icos is based in Bothell, just a few miles from Microsoft’s Redmond headquarters. Gates is also a director at Icos.

The company was founded in 1990 by George Rathmann, a co-founder of Thousand Oaks-based Amgen Inc., the world’s biggest biotechnology firm. Rathmann, who owns 4.6% of the stock, is chairman and chief executive.

Icos’ drug doesn’t seem to have some of Viagra’s side effects, such as a temporary bluish tinge to vision, Heyward said. Other mild side effects have been reported by Viagra users, including headaches and a stuffy nose.

Six Viagra users have died, three due to a combination of Viagra with nitroglycerin or related heart drugs. The other deaths have been attributed to heart attacks or strokes following sex. Pfizer warns patients not to combine Viagra with nitrates.

Like Viagra, Icos’ drug works by stopping enzymes thought to prevent erections by blocking the flow of blood to the penis. Icos said its drug appears to act on just one of these kinds of enzymes, known as phosphodiesterases, while Viagra may affect others. Drugs that target enzymes more specifically produce fewer side effects.

Viagra may affect a whole range of body tissues and organs, including the kidneys and brain. Icos’ drug targets more directly the enzyme that works on smooth muscle tissue, such as that regulating blood flow in the penis.

Icos, which is seeking new drugs by looking for ways to interfere with the inflammation process, said it doesn’t have any drugs in the final phase of testing. It has begun human testing of drugs to treat multiple sclerosis and psoriasis, a skin condition marked by recurring inflammation and scaly patches.

Icos isn’t alone in developing competitors to Viagra.

One company, Zonagen Inc., recently completed clinical tests on its Vasomax and expects to ask the Food and Drug Administration to approve the drug by the end of June.

Zonagen, based in The Woodlands, Texas, said Vasomax can be effective within 15 to 30 minutes, compared with about an hour for Viagra.

Tap Pharmaceuticals’ apomorphine is in the final stages of clinical trials and could be used alone or in combination with Viagra, said Dr. Harin Padma-Nathan, director of the Male Clinic in Santa Monica.

Apomorphine affects the brain chemicals responsible for sexual response, whereas Viagra works directly on the penis.

Given the large number of Viagra users and the fact that most have existing health problems, the side effects have been minimal, Padma-Nathan said.

“This drug really is the gold standard,” he said of Viagra. “It is exceedingly safe.”

Meanwhile, a scientific advisory panel Friday gave Viagra a positive review in the European Union, improving its chances for being sold in its 15 member nations.

The European Medicines Evaluation Agency still has to approve the drug for sale in the European Union, which could take about three months. It would then take a few weeks to start drug sales, Pfizer spokesman Andrew McCormick said.

Black-market Viagra sales have been reported around the world. Men living in European Union countries are already traveling to buy Viagra in pharmacies in Andorra and Switzerland.

Pfizer shares slipped $1.81 to close at $104.81 on the New York Stock Exchange. The shares have doubled over the last year on the prospects for Viagra.

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Associated Press and Bloomberg News were used in compiling this report.