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Impotence drug Cialis gets OK for sales in U.S.

By Luke Timmerman
Seattle Times business reporter

	AP Cialis is a product of Bothell-based Icos and its partner Eli Lilly.
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It took 13 years to do it, but Icos reached the most important moment in its history yesterday when it won FDA approval to sell its first drug in the U.S.: the impotence drug Cialis.

Corks were popped and high-fives were slapped yesterday around the Bothell biotech company, founded by big industry names and an investment from Bill Gates. The news means its days as a research-and-development-only company are over, and big money will be spent on marketing Cialis into a billion-dollar cash cow to compete with Viagra and another drug, Levitra.

The FDA is allowing Icos and its partner Eli Lilly to claim the drug lasts up to 36 hours, isn't diminished by high-fat foods, and kicks in after a half-hour. The side effects, similar to those of its competitors, include headache, back pain and muscle aches.

Paul Clark, a former sales and marketing executive from Abbott Labs hired four years ago to run Icos, said Cialis will hit pharmacies in early December. Cialis will have an edge in the market, Clark said, because studies show that men would rather have a pill that lasts a lot longer than four hours.

"With a duration of 36 hours, it truly can bring spontaneity back into the relationship," Clark said.

Cialis What is it? The third FDA-approved pill for impotence Who makes it? Icos, a Bothell biotech company, and its partner Eli Lilly How long does it last? Up to 36 hours Common side effects: Headache, indigestion, back pain, muscle aches, flushing, stuffy nose Price: Comparable on per-pill basis to Viagra ($87.99 for 10 Viagra tablets on drugstore.com) Source: Food and Drug Administration-approved label

In the nine months Cialis has been on the market in Europe, word has spread. Cialis has grabbed nearly 30 percent of the impotence drug market and snagged the nickname "the weekend pill." If Cialis can do that in the U.S., it would be lucrative — Viagra got $1.1 billion of its $1.7 billion in global sales last year from the U.S. That money could make Cialis the second blockbuster drug from Seattle's biotech industry, after Immunex's Enbrel for rheumatoid arthritis.

In what some analysts considered an example of "buy on the rumor, sell on the news" market-timing behavior, stock in Icos fell 3 percent yesterday to $43.66. But the stock is up 87 percent year-to-date, giving it a market worth of $2.8 billion. Lilly stock also fell 3 percent yesterday.

Paul Latta, an analyst with McAdams Wright Ragen in Seattle, said Cialis is not as big a business hit or medical breakthrough as Enbrel, but it will be more famous.

"Three years from now, Seattle is going to be known for coming up with good coffee and good sex," Latta said. He doesn't own the stock, but rates it a "buy."

The drug came out of compounds Icos tested in the early 1990s as potential treatments for heart disease. It was designed to block an enzyme, relaxing blood vessels and allowing increased blood flow to tissues.

In 1998, when Viagra won FDA approval and became an overnight pop-culture icon, Icos was in the enviable spot of having a similar but longer-lasting compound that had been tested in humans.

Later that year, it signed a deal with Eli Lilly that gave each an equal split of sales and profit in North America and Europe. Eli Lilly helped run large clinical trials and helped the drug win FDA approval. It is making the drug and marketing it.

Icos now has more than 700 employees. It has hired 165 salespeople this year and says it plans to grow and push other experimental drugs in its pipeline.

Wall Street will also start scrutinizing its bottom line closer than ever before.

"This is really (Icos') opportunity to shine," Latta said.

Luke Timmerman: 206-515-5644 or ltimmerman@seattletimes.com

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