Strong sales of Cialis continue

Published 9:00 pm Friday, July 21, 2006

BOTHELL – Sales of Cialis outstripped expectations for the second quarter, putting the erectile dysfunction drug developed by ICOS Corp on a pace to generate more than $900 million this year.

Worldwide, Cialis tallied $233 million in quarterly sales, according to Lilly ICOS, the joint venture between Bothell-based ICOS and its pharmaceutical partner for Cialis, Eli Lilly &Co. That compared to sales of $191 million in the same quarter of 2005.

Those results elevated ICOS shares, which have struggled in recent years, by 5 percent Friday. The stock closed trading at $21.44.

ICOS spokeswoman Lacy Fitzpatrick said the quarter didn’t see any price increases for the drug in the U.S., and she wasn’t aware of any unusual stocking orders from pharmacies. Either could have given sales an unusual one-time bump.

“Just strong sales. We’re delighted,” she said.

Paul Latta, an analyst with Seattle’s McAdams Wright Ragen, echoed that the sales figures were “excellent.” He had estimated $220 million in sales for the quarter.

With the higher sales and a 28 percent reduction in the joint venture’s marketing and administrative expenses, Lilly ICOS reported a quarterly net income of just under $76 million, compared to a net loss last year of $1.7 million.

Cialis, which gained U.S. regulatory approval in late 2003, has since gained 26 percent of the market for prescription impotence drugs. Pfizer Inc.’s Viagra holds a market share more than twice as large. After stalling last year, the overall U.S. demand for such drugs has begun growing again as well.

And with sales totaling $456 million in the first half of this year, Cialis is expected to top earlier estimates of $900 million in annual sales for 2006. Barring a drop in demand, the drug next year could be one of a select few developed in the Puget Sound area to reach $1 billion in annual sales. That would give it the designation of a “blockbuster.”

“It just seems improbable they won’t hit a billion dollars next year,” Latta said.

Lilly ICOS also is seeking approval for a once-a-day version of Cialis to treat impotence, and the drug’s active ingredient is being tested as a possible treatment for hypertension, enlargement of the prostate and pulmonary arterial hypertension, a potentially fatal lung condition.

Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.