SEATTLE – This was the shareholders meeting that ICOS Corp.’s earliest investors anticipated for more than 13 years.
In 1990, the Bothell-based firm had a relatively small number of believers. Now, after the U.S. launch of Cialis, the erectile dysfunction drug that has quickly gained a nice slice of the market, ICOS is one of the biotechnology industry’s largest players.
“We labored for 13 years to get our first product to market,” ICOS chairman Paul Clark told investors at the company’s annual meeting on Friday. “It’s a claim that only a handful of the 1,200 or so biotechs in the country can make.”
Shareholders, including longtime board member Bill Gates, were mostly in a good mood at the gathering in Seattle. But Clark told them ICOS doesn’t intend to rest on Cialis’ initial success.
“We’re just getting started. No doubt, we like our beginning, but there’s much unfinished business,” he said.
ICOS executives summarized their plans to test Cialis’ effectiveness against benign prostatic hyperplasia, a condition caused by enlargement of the prostate in older men.
David Goodkin, ICOS’ chief medical officer, said patient tests could begin later this year. If successful, the drug could serve a market worth an estimated $1.9 billion in the United States, Europe and Japan.
There may also be other conditions that Cialis can treat as well, Goodkin and Clark said.
Goodkin also updated shareholders on clinical tests for IC485, a possible treatment for chronic obstructive pulmonary disease, and on other research programs. ICOS plans to begin tests on two to three new potential drugs within the next two years.
But company officials and shareholders at Friday’s meeting focused mainly on Cialis’ launch in the United States. Since winning approval from the U.S. Food and Drug Administration late last year and unleashing a TV advertising blitz that began during the Super Bowl, the drug has captured nearly 20 percent of the new prescriptions written for impotence patients.
That has quickly made the drug No. 2 in the market, outselling Levitra, which was released last summer.
“With Levitra receding in our rearview mirror, our sights are set squarely on Viagra,” Clark said.
Leonard Blum, senior vice president for sales and marketing, said Viagra’s recent loss of market share shows the No. 1 drug is vulnerable, even if it dominates now. Overall, ICOS expects Cialis sales to reach at least $500 million this year; Viagra’s sales were $1.7 billion last year.
ICOS’ recent good fortune was emphasized by one shareholder Friday, who led a “hip, hip, hooray” cheer for his fellow shareholders.
The celebratory mood wasn’t universal, however. A few shareholders had tough questions about the company’s future.
Ron Gainor, a Colorado attorney, pointedly asked Clark if investors would be better off if Cialis or the entire company were sold to Eli Lilly &Co., ICOS’ partner in Cialis.
Gainor is not alone, as some investors and analysts have speculated in recent months whether ICOS could become an acquisition target. Clark, who has said in the past that ICOS is not looking for a suitor, restated that opinion.
“Our objective is to increase the value of the company today and into the future. But if someone brought us a legitimate offer today, it would be our responsibility to bring that to the board of directors for consideration,” Clark said.
ICOS stock closed at $31.11 a share Friday, up 44 cents from the previous close.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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