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From Icos: The Son Of Viagra?


Inside Wall Street

FROM ICOS: THE SON OF VIAGRA?

If it's true that biotechnology stocks are starting a long bull run, as some analysts believe, Jim McCamant is ahead of the pack. He has been pounding the table for investors to invest in biotechs, a group he says is pregnant with future Genentechs, Chirons, and Amgens.

A big favorite of McCamant, editor of Medical Technology Stock newsletter in Berkeley, Calif., is ICOS (ICOS). The company has a number of products in various stages of clinical trials--including IC351, an anti-impotence pill that, he says, "will be a potentially better product than Pfizer's Viagra, because it has fewer side effects."

ICOS hasn't grabbed investors in the way Viagra and other Viagra wannabes have: The stock is currently at 15 9/16, down from a peak of 18 7/8 on Dec. 30. But it has high-profile backers: Bill Gates is on the ICOS board and owns 13% of the stock, and George Rathmann, co-founder of Amgen, is chairman and CEO of ICOS, with 5.3%. The company has yet to make money.

Considering all the new products in ICOS' pipeline, including IC351 (yet to be assigned a brand name), the stock is worth twice its current price, says McCamant. In January, ICOS initiated phase-two trials of IC351 on men with erectile dysfunction. IC351 blocks the action of enzymes called phosphodiesterases (PDEs), believed to inhibit production of an erection, explains McCamant. IC351 controls the same enzyme that Viagra does. The reason that this pill has fewer side effects, claims McCamant, is that IC351 is more selective: It inhibits just the enzymes that block blood flow into the penis.

McCamant figures that, given the attention investors have showered on Viagra, "even a modest success by IC351 should have an impact on ICOS' stock." ICOS may also develop IC351 as a treatment for congestive heart failure and angina, says McCamant. He expects that tests will validate IC351's safety before yearend. Trials are expected next year to evaluate the pill's efficacy. BY GENE G. MARCIAL


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