By Matthew Willett

Icos Corp. filed with the SEC to offer 5 million shares to the public, a follow-on offering that would, at Thursday's opening price of $48, raise $240 million for the 11-year-old biotech veteran.

In its filing, Icos estimates a share price of $48.25 per share, making its take, including a fully exercised overallotment option, about $263 million.

Underwriters SG Cowen Securities Corp., Banc of America Securities LLC, Prudential Vector Healthcare Group, Robertson Stephens and Ragen MacKenzie Inc. were granted an option to purchase an additional 750,000 shares to cover overallotments.

The Bothell, Wash.-based company said it will use the proceeds to fund product development, clinical research and technology acquisition, in addition to general corporate purposes.

After the offering, the company will have about 51 million shares outstanding. As of June 30, Icos had about $59 million in cash and cash equivalents. Its stock (NASDAQ: ICOS) fell $1.75 Thursday to close at $46.25.

The protein-based and small-molecule therapeutics company focuses on target areas including erectile dysfunction, female sexual dysfunction, sepsis, pulmonary hypertension and other cardiovascular diseases, inflammatory diseases and cancer.

In late-stage clinical development now, the company has a Phase III erectile dysfunction therapeutic, Cialis, which it plans to submit a new drug application to the FDA for in the second half of 2001.

Also at Phase III level, Pafase, the company's sepsis treatment, is scheduled to begin a pivotal trial in the first quarter of next year. Its pulmonary hypertension therapeutic, Sitaxsentan, is currently in a Phase IIa clinical trial.

In preclinical development Icos has its female sexual dysfunction therapeutic, Cialis; a second sepsis therapeutic, IC14; its chronic inflammatory disease treatment, IC485; and its chronic heart failure and essential hypertension treatment, TBC3711.

Icos collaborates with Eli Lilly and Co., of Indianapolis; Suntory Ltd., of Tokyo; and Texas Biotechnology Corp., of Houston.

The Lilly collaboration for development and commercialization of Cialis dates to October 1998. Icos has received a $75 million payment upon the formation of their joint venture and a $15 million milestone payment upon the initiation of the Phase III clinical trial program.

The joint venture with Suntory formed Suncos, an equally owned company for the worldwide commercialization of Pafase that was formed with a $30 million investment from Suntory. Icos licensed all rights to Pafase to Suncos as a part of that venture.

Most recently, Icos formed a collaboration with Texas Biotechnology for the development and commercialization of endothelin antagonists such as Sitaxsentan. The deal included an initial payment of $2 million to Texas Biotechnology and could mean up to $53.5 million in milestones.

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