BOTHELL — Cialis sales surpassed $100 million during the first full quarter the erectile dysfunction drug was on the U.S. market, but marketing costs also swelled.
Lilly ICOS, the joint venture between Bothell’s ICOS Corp. and Eli Lilly &Co., reported Monday that first-quarter sales of Cialis exceeded $108 million worldwide, compared to $203 million for all of 2003.
Sales in the United States, the world’s largest market for erectile dysfunction drugs, represented almost $33 million of that total from last quarter. That was up from fourth-quarter sales of $28 million following the drug’s approval by the Food and Drug Administration in late November.
ICOS’ chief executive officer, Paul Clark, said he was "delighted by the favorable response" from patients and doctors since the drug was launched in the United States.
Paul Latta, an analyst at McAdams Wright Ragen in Seattle, said the first-quarter sales figures didn’t meet his estimates, but they weren’t worrisome, either.
"They were a little bit less than we expected, but within the range of where they should be," said Latta, whose firm has issued a "buy" rating for ICOS.
Latta said he took special note of Cialis’ growth in Europe, where the drug has already been on the market for a full year. The prescription drug is now selling in 55 countries around the globe.
Lilly ICOS also reported that expenses also grew to $220.4 million for the quarter, compared to $60.7 million for the same period in 2003. Marketing and administrative costs accounted for $195 million of that total.
"It was a huge number, but it wasn’t as huge as we were predicting," Latta said. He said spending money to establish Cialis’ presence is justified, as ad campaigns for rival drugs Viagra and Levitra are being stepped up as well. "I think (Lilly ICOS) will have to defend their turf."
Clark said he expects the first-quarter loss for Lilly ICOS, which totaled $138.8 million, will represent more than half of the joint venture’s loss for all of 2004.
The heavy advertising for Cialis on TV, in print and at PGA tournaments and other events seems to have had the desired effect.
As of April 9, Cialis accounted for more than 19 percent of new U.S. prescriptions for erectile dysfunction drugs and 11 percent of the overall market share, according to IMS Health. That kept it above the share for Levitra, a rival drug launched here last August.
Viagra, however, still rules the category, with the lion’s share of the market. Viagra’s maker, Pfizer Inc., is expected to report today that first-quarter sales of the drug exceeded $480 million, according to Bloomberg.
ICOS, however, has expressed confidence about making inroads into Viagra’s market share. Cialis has the advantage of being effective for up to 36 hours after ingestion, compared to about four hours for Viagra.
Clark added Monday that ICOS is exploring Cialis’ effectiveness in treating medical conditions other than impotence. He is expected to announce more details about that research next month.
Shares in ICOS fell 92 cents Monday to close at $34.50. Lilly, which also released its first-quarter results, saw its stock rise 95 cents to $73.40 a share.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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