Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Businessweek Archives

Why Vivus Is Feeling Its Oats


Inside Wall Street

WHY VIVUS IS FEELING ITS OATS

This obscure fledgling has yet to make a penny. But it's getting plenty of notice on the Street: Shares are moving higher--from 11 in May to 24 lately. What's going on?

VIVUS (VVUS) aims to be No.1 in treating male impotence--and is developing therapies for erectile dysfunction (BW--Oct. 30). To some pros, VIVUS is still modestly priced. "Few biopharmaceutical companies have near-term revenue and cash-flow opportunities like VIVUS," argues Wole Fayemi a money manager at San Francisco's Genesis Merchant Group.

Fayemi figures the stock could hit 35 in six months, after VIVUS has applied for Food & Drug Administration approval of its first product--Medical Urethral System for Erection (MUSE)-Alprostadil. He thinks there's a 90% chance of approval.

VIVUS won plaudits from analysts after its third round of clinical tests in October. For MUSE, an applicator like a straw is inserted into the urethra to deliver Alprostadil in a pellet form that dissolves in seconds. Alprostadil relaxes the cavernous and arteriolar smooth muscle while restricting venous outflow. After 5 to 10 minutes, says Fayemi, the drug produces an erection that lasts for 30 to 60 minutes.

In recent tests, 996 men with severe impotence used MUSE, and about 65% ended up having intercourse at least once during the study, compared with 16% of those on a placebo. More than 60% of patients who used the product, says Fayemi, were able to achieve orgasm. Upjohn has a similar, FDA-approved product, Caverject, which is injected into a man's organ. "MUSE will have a significant marketing advantage because of a perception about the pain involved," notes Fayemi. Moreover, data from several hundred patients show "95% to 100% evaluate MUSE as extremely easy to use, he adds, although there is initial pain involved as well.

Fayemi says 1 million to 2 million men every year seek impotence treatment. If the product gets approval in 1996, he expects revenues of $37.5 million in 1997 and $184 million in 1998, when he figures VIVUS will start making money. Among major institutional investors as of June 30: General Electric Investments, BEA Associates, and J.P. Morgan.BY GENE G. MARCIAL


LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus