Juanita High School
February 27, 2003
Table of Contents
I. Company Background 3
II. Products 4
III. Industry Data 8
IV. Organization of Company 12
V. Job Classifications 15
VI. Career Paths 16
VII. Public Relations 17
VIII. Mentorship 18
X. Future 19
XI. Notes from Interview 21
XII. Works Cited 22
ICOS Corporation is a leading biopharmaceutical company in the Puget Sound
region. Founded by three men in 1989, George B. Rathmann, Ph.D., Christopher S.
Henney, Ph.D., D.Sc., and Robert Nowinsky, Ph.D., ICOS is committed to bringing
innovative and efficient drugs to market that meet considerable unmet medical needs,
which, for millions of people, it can then improve the quality of life. George B.
Rathmann, Ph.D. received his degree in physical chemistry from Princeton University,
where he then moved on to Abbott Laboratories, Inc. as Director of Research and
Development and later Divisional Vice President. In 1980 Rathmann co-founded
Amgen, Inc., later Immunex, Inc., and served as Chairman of the Board, President and
Chief Executive Officer. He formed ICOS with two colleagues and later served as Chief
Executive Officer and President from 1991 to 1999. Rathmann has now moved on to two
different companies, Hyseq, as Chairman of the board, and Callida, Chairman and
Interim President and CEO since October 2001. Christopher S. Henney, Ph.D., D.Sc. is
the second founder of ICOS, and also helped to found Immunex Corporation in 1981. He
received his Ph.D. from the University of Birmingham (England) in Experimental
Pathology and for his research contributions to immunology, a D.Sc. from the same
university. Henney has served as Executive Vice President, Scientific Director and
Director at ICOS and positions including, but not limited to, Director, Vice Chairman and
Scientific Director at Immunex. He is currently Chief Executive Officer for Dendreon
starting from 1995. There was no bio to be found concerning the third piece to the
founding of ICOS, Robert Nowinsky, Ph.D.
ICOS has been successful over the years due to several intelligent and unfailing
decisions early on. The Puget Sound area was chosen because of the convenient access
to major research institutions, a good pool of talented scientists, and two-thirds of the
founders were located in the area. Strategies used to develop new products create the
reliability a company must have to keep employees and for products to continuously go
to market. In the development aspect of ICOS, a team of employees is motivated to
assertively move potential drugs through clinical steps with the knowledge of future
benefits in the quality of life for many. This knowledge pushes the team to complete
their step in drug development sooner rather than later. The development process deals
with clinical trial design and management, commercialization, manufacturing, regulatory
administration and others which all affect the progression of products efficiently. In
research, the same goals apply with speedy progress of potential drugs and the additional
goal of identifying one to two new candidates each year that are suitable for clinical
entry. The research department has multiple major research and preclinical programs
currently in progress and with growth in research capabilities in molecular, cellular and
structural biology, and also through high-throughput drug screening and medicinal
chemistry and genomics. With this progress and development, ICOS is able to apply an
integrated scientific approach to areas of proficiency.
ICOS Corporation holds much hope and aspiration for new products currently
under development with each at different stages. Throughout drug development, there
are various stages: research, preclinical and clinical. Research involves concept
development (what will the drug do, why is it important to have this drug?), scientific
rational (is it possible to actually create this drug?), and proof of concept (the actual
development of the drug, physical proof of the drug). Preclinical development is the
second step, which involves determining several different aspects of the drug, toxicity,
formulations, efficacy, in vivo and in vitro studies, and more. It determines how safe the
drug is before actually tested on humans. The final step, clinical development, is divided
into three separate phases. Phase one involves normal, healthy test subjects in a small
study. This phase is completed to demonstrate the safety of the drug. Phase two also
holds a small study; only it is tested with “sick” subjects, as in people who are afflicted
with the ailment the drug will supposedly improve. A large “multi-site” study is
conducted in phase three of clinical development. This phase will make or break the
drug. Millions of dollars have been invested thus far in the development and the Food
and Drug Administration can reject the drug if the desired results have not produced.
ICOS currently has seven product candidates in clinical trials. CialisTM (tadalafil)
has currently had its first shipment in Europe after it passed the European Commission on
November 12, 2002. They expect an FDA regulatory decision in the later half of 2003
concerning the drug. CialisTM holds a treatment for erectile dysfunction (ED) and will be
available in the next few weeks by prescription in pharmacies across the European Union.
The drug is an oral PDE5 inhibitor and has been developed by ICOS for over eight years.
This is a joint venture between Eli Lilly and Company and ICOS Corporation resulting in
Lilly ICOS LLC (“Lilly ICOS”). Lilly ICOS will have marketing rights in both North
America and Europe, while Eli Lilly has marketing rights to the product outside of North
America and Europe with royalties to be paid to Lilly ICOS. There is a tremendous
market need for CialisTM as in North America and Europe; an estimated 70 million men
are believed to have ED, which proves to be quite beneficial to ICOS Corporation and its
There are many other products currently in clinical trials. One of these is
Sitaxsentan, a product that will help with pulmonary arterial hypertension. Pulmonary
arterial hypertension is a progressive disease distinguished by elevation of pulmonary
artery pressure and pulmonary vascular resistance. This can often lead to heart failure
and death. Sitaxsentan is a small molecule product, which blocks endothelin. Endothelin
intervenes blood vessel constriction and growth of smooth muscle in vascular walls. This
product has completed Phase 1, 2, and 2b/3 with the drug being developed in an
affiliation known as ICOS-Texas Biotechnology L.P. This drug could prove to be
profitable as up to 100,000 people worldwide are afflicted with primary and secondary
pulmonary arterial hypertension.
IC747, a LFA-1 antagonist, is currently in Phase 2a clinical trials in patients with
moderate to severe psoriasis (a chronic skin disease), is being evaluated for tolerability of
IC747. LFA-1 is a cell adhesion molecule that is selectively expressed on leukocytes. It
has been revealed to play a key part in the activation and trafficking of T-lymphocytes in
tissue at inflammation sites. ICOS scientists have grown in their own understanding of
how IC747 binds to LFA-1, inhibiting T-lymphocyte activation and how LFA-1 is
regulated. IC747 is orally administered and will lead to be valuable to the public as
psoriasis affects over four million people in the U.S. It is currently a joint project
between ICOS and Biogen, with equally shared profits. IC14 is currently in Phase 2
clinical study in patients with community acquired pneumonia and sepsis was initiated.
Sepsis is a systemic inflammatory response to infection; the infection may develop into
multiple organ failure and even death. IC14 is a monoclonal antibody product that
selectively hinders CD14 receptors. The CD14 receptor on white blood cells, with the
binding of bacterial toxins, can instigate a surge of immune system responses that can
then result in sepsis. Sepsis has afflicted over one million people each year in the United
RTXTM (resiniferatoxin) helps with interstitial cystitis, which is a condition
associated with severe pain in addition to urgency and high frequency of urination. It is a
small molecule that can be distributed to the bladder to desensitize particular nerves
called afferent nerves. These are thought to play a part in many pathological conditions
of the bladder including interstitial cystitis. RTXTM has just begun Phase 2 clinical study
of patients with interstitial cystitis. Of the 700,000 Americans with interstitial cystitis,
ninety percent of them are women with ICOS holding 100% of profits.
TBC3711 is an oral endothelin A receptor selective antagonist and is currently in
Phase 1 clinical study. The study is to determine the tolerability of the product, and is
being deemed as a possible treatment for a cardiovascular or other disease. In the
treatment of diseases where the regulation of vascular constriction and tone is important,
endothelin receptor antagonists are thought to be successful. As cardiovascular and other
diseases are prevalent among the population, treatments will be considered through
TBC3711 where unmet medical needs exist and endothelin is pathogenic.
IC485 (PDE4 inhibitor) has been projected to help chronic obstructive pulmonary
disease and rheumatoid arthritis, with both treatments currently in Phase 1 clinical trials.
Certain inhibitors of the type 4 phosphodiesterase (PDE4) ease inflammatory
developments instigated by pro-inflammatory mediators, including interleukin-1 and
tumor necrosis factor-alpha. ICOS scientists, through medicinal chemistry optimization
process, have identified the product, which is orally administered, and acceptable
pharmacokinetic properties. Earlier preclinical studies have shown that IC485 shows
potency and selectivity while also shows limited side effects at doses that demonstrate
anti-inflammatory effects. This drug will benefit the more than 16 million Americans
that are believed to have COPD, which is the fifth leading cause of death in the U.S.
Also, rheumatoid arthritis is one of the most common forms of arthritis, which affects
more than two million people in America. All of these products hold many possibilities
for ICOS, its affiliates and the general population.
The biopharmaceutical industry is exciting yet extremely unpredictable. ICOS
Corporation and its past financial data and stock prices only confirms that. The stock at
ICOS has risen and fallen over the years, all for different reasons, some being new
product development and then the termination of certain products. The stock prices,
when the company first went public, started out at 7.75 at the end of June of 1991, and in
December of 2002 closed at 23.41. There was a relative maximum in June of 2002
closing at 64 and relative minimum in December of 1994 closing at 3.5, in December of
1999 closing at 29.25, and again in June of 2002 closing at 16.96. The latest closing
price (February 27, 2003) was at 19.68. This decrease may not be the result of the
company, but rather the entire economy and current crisis.
Stock prices (1991-1997)
D at e
Stock Prices (1998-2003)
D at e
Revenue from product sales and other sources (i.e. collaborative research and
development from related parties and licenses of technology, primarily to related parties)
has grown over the years (data prior to 1997, and 2002 data not available) increasing
from $31,576,000 in 1997 to $93,369,000 in 2001. Expenses however, have outweighed
revenue, therefore sending the company into a net loss over the years. Reasoning for a
net loss can be explained through the verity there has been a lack of products on the
market, until now, 2003, all of the potential product candidates have been in research,
preclinical, or clinical trials. Expenses over the years, from 1997 to 2001, has increased
from $47,449,000 to $173,542,000, resulting in a total net loss escalating from
$12,015,000 to $80,173,000. Operating expenses in research and development alone
have increased over the years from $42,783,000 in 1997 to $111,801 in 2001. Capital
raised (in working capital alone) has increased from $24,536,000 in 1997 to
$381,365,000 in 2001. Cash and cash equivalents, investment securities and interest have
amplified from $25,773,000 in 1997 to $470,707,000 in 2001. Total assets themselves
have enlarged from $54,065,000 in 1997 to $507,587,000 in 2001. There have not been
any product sales to date, as there have not been any ICOS products on the market, until
now. Overall, total investments, capital, cash, revenue, etc. has increased. However, so
have expenses, therefore, until profits come in from sales concerning CialisTM, ICOS
Corporation will continue to keep a net loss, and will most likely continue to raise over
the years, as seen in the past.
Total Net Income (Loss)
1 2 3 4 5
Cost (in thousands)
Total Revenue and Total Expenses
Cost (in thousands)
*For both graphs: 1=1997, 2=1998, 3=199, 4=2000, 5=2001
Organization of Company
Employment in the company has continued to increase over the years (no precise
data was available) starting with sixty-five staff members, and has expanded into a 450-
plus-employee company. Many of the original sixty-five employees are still part of
ICOS, and many specialty jobs have resulted from an increase in product candidates and
The company is organized into many different divisions: administration, business
development, clinical, facilities/engineering, finance/logistics, human resources, onsite
daycare, information system, investor relations, legal, manufacturing, sales and
marketing, research and development, preclinical research, quality, therapeutic
development, and regulatory affairs. The size of each division varies, with research and
development the largest of the many divisions. ICOS Corporation uses a matrix
organization, starts with CEO, down to Vice Presidents, then managers, directors,
supervisors, associates, etc., and holds many top executives within the company.
The CEO, President and Chairman are Paul N. Clark. He has been a part of the company
since 1999, previously working for Abbott Laboratories, Marion Laboratories, and
Sandoz Pharmaceuticals (now Novartis Corporation). He received his M.B.A. from
Dartmouth College, Amos Tuck School, and his B.S. in finance from University of
Alabama. Gary L. Wilcox, Ph.D. serves as Executive Vice President, Operations and
Director. He has been with ICOS from 1993 and has previously worked for XOMA
Corporation and International Genetic Engineering, Inc., which he co-founded. Wilcox
received his Ph.D. and M.A. in molecular biology and biochemistry, and his B.A. in
cellular and molecular biology from the University of California at Santa Barbara.
Leonard M. Blum is Vice President, Sales and Marketing and has been with ICOS
since 2000. Formerly, he worked and served for Merck Sharp & Dohme Israel, Merck
and Co., an officer in the United States Army Special Forces, and Shearson Lehman
American Express. He received his M.B.A. from the Stanford Graduate School of
Business and his A.B. in economics, magna cum laude, from Princeton University; he
was also a Fulbright Scholar in international finance at the University of Zurich. W.
Michael Gallatin, Ph.D. is Vice President and Scientific Director and has been with the
company since 1990. Prior to working at ICOS, he was a faculty member of the Fred
Hutchinson Cancer Research Center in Seattle and an affiliate member of the Department
of Microbiology at the University of Washington. Gallatin received his Ph.D. in
immunology from the University of Alberta and his B.S. in zoology from Truman State
The Vice President, Development and Chief Medical Officer is David A.
Goodkin, M.D., F.A.C.P. and has been with ICOS since 2002. Before ICOS, he worked
for Amgen Inc. and has completed nephrology fellowships at Albert Einstein Medical
Center and Temple University Health Center, and internal medicine residency at the
University of Miami. He received his medical degree from the State University of New
York at Syracuse and graduated summa cum laude from Dartmouth College. Thomas P.
St. John, Ph.D. is Vice President in Therapeutic Development and joined the company in
1990. Before working at ICOS, he was a member in the Department of Medicine and
Department of Genetics and the University of Washington. He also received his Ph.D. in
biochemistry from Stanford University and his B.S. in biology from California Institute
Michael A. Stein is Vice President and CFO and has been with ICOS since 2001.
Previously he has worked for Nordstrom, Inc., Marriott International, Inc., Arthur
Andersen LLP, Getty Images, Inc. and on the Board of Trustees of the Fred Hutchinson
Cancer Research Center. He received his B.S. in business administration from the
University of Maryland at College Park, MD. Vice President, Business Development at
ICOS Corporation is Clifford J. Stocks who has been with the company since 1992. Prior
to joining ICOS, he worked for Booz Allen & Hamilton as an Associate. Stocks received
his M.B.A. from the University of Chicago Graduate School of Business and a B.S. in
biology from the University of Utah. The eight executives profiled here have all
contributed greatly for the ever-increasing success of ICOS Corporation and continue to
strive for excellence.
ICOS Corporation, as previously stated, holds an expansive research and
development program, implicating that most of the research done for the company is
located on-site. However, with joint ventures, research may be done at the affiliate
company such as Eli Lilly. Preclinical and clinical trials may also be conducted on-site,
but again, depending on circumstances, preclinical and clinical trials may be completed
off-site. Clinical testing is a process that will most likely require a broad study group,
which then entails ICOS to send their products off-site to various clinics nationwide or
worldwide, as the company holds only one site, located in Bothell, Washington. A
clinical trial, to have an accurate study, requires the observations from a series of
different races, cultures and environments, and as Bothell does not have neither every
environment nor every culture or race, off-site clinical testing must be done.
Research projects are organized through concept, scientific rational and proof of
concept. Concept is the beginning of the lengthy process. The team of scientists must
create an idea that will meet medical needs either nationwide or worldwide. A product
must prove to be profitable to be considered possible. However, an “orphan drug” is a
product that would help a limited number of patients in an environment such as a 3rd-
world country. Orphan drugs create and enormous tax break for the company, and
although it sounds capitalistic in nature, as seen in previous financial data the investments
needed to keep a biopharmaceutical company alive is massive. Once a concept is
established, scientific rational comes into play. Scientific rational addresses the question
of whether or not it is scientifically feasible to create the drug. Once scientific rational is
tackled, proof of concept is necessary. Proof of concept holds the researchers responsible
for the product candidate they created and resulted in a proposal to both the company and
FDA to push the product into preclinical trials, followed by clinical trials.
Projects are carried out in phases, with a different team of people working on each
phase. In the research phase, a team of research scientists is developing the product
candidate through the steps outlined above. After research scientists have completed
their process, scientists in preclinical will take their turn determining the toxicity,
efficacy, etc. until completed. Scientists in clinical will then follow up with their studies
on human patients establishing the safety, tolerability and effectiveness of the product.
Throughout the entire process, there are checkpoints along the way to ensure the
legitimacy and authority within the product and data concerning it.
There are several different job classifications within ICOS Corporation depending
on department and experience/degrees. In the scientific field, careers range from one
with no degree required to needing a Ph.D. The ranking goes somewhat from Laboratory
Assistant, to Associate, Director, Staff Scientist, Senior Staff Scientist, Vice President,
then President. Positions within departments and divisions do however vary, and are
specialized to the position that is currently needed in the company. Requirements for the
various positions vary, also depending on the department. Laboratory Assistant in the
research department requires only a high school degree, where Associates require a BS or
BA in the field of science and the standard communication skills, computer skills, etc.
Director requires experience in the pharmaceutical and biopharmaceutical industry, with
a prerequisite of a BS or BA with a preference for an advanced degree. Staff Scientist
and Senior Staff Scientist are a step higher, with both requiring a Ph.D., Senior Staff
Scientist holding slightly more authority than Staff Scientist. Vice President and
President require years and years of experience with not necessarily a Ph.D., but the
equivalent experience of a Ph.D. Again, all of these jobs vary from department to
department, with added or deleted positions. For example, a position in administrative
might be a Payroll Specialist, or in manufacturing they might be a Supply Chain Director.
Both of these require a B.A.
There are many possible career paths in ICOS Corporation, for both a scientist
and non-scientist. A scientist may take the possible career path described above going
from Laboratory Assistant or Associate to a Senior Staff Scientist. This however, is a
long path and can take fifteen to twenty years; it can, conversely, be quickened through a
Ph.D. which will help one rise within a company much faster. The scientist may take
three different paths to start, within research, preclinical and clinical. After one chooses
which path, when a certain position is reached, usually while an Associate Director or
Director, an employee must decide if they would like to continue to work in a laboratory
setting or work in a more typical office setting. A laboratory setting, except in research,
does not have as many “rungs in the corporate ladder.” Whereas higher ranks in clinical
and preclinical conduct more computer-associated work that would be done in a
laboratory associated job.
For a non-scientist, there are many different opportunities available. Depending
on one’s degree, paths in legal, administration, accounting, human resources, and more.
Within the chosen department, there is the general path of “climbing the corporate
ladder.” As ICOS expands into a larger company, many new positions open up in
departments and new departments and divisions in themselves may develop.
ICOS Corporation has excellent public relations with much of the media,
especially in the Puget Sound Region. Also, it’s website contains new press releases, and
is there to inform and educate the general population. Press releases are made to the
media whenever a large advancement in product development has occurred such as the
first shipment of CialisTM to Europe. Another announcement that may be available to the
press is FDA approval for clinical trials or the termination of a product candidate such as
Pafase, which was supposed to help with severe sepsis. Pafase was a product candidate
that was in Phase 3 Clinical Trial when it was determined the study failed to demonstrate
clinical benefit. A twenty-eight-day all cause mortality was the chief efficacy endpoint,
and ICOS is stopping any and all patient enrollment in the study and will end any further
work on the product candidate as recommended by an Independent Data Monitoring
Committee (IDMC). ICOS is a company not afraid to neither face the public with
problems within the company nor deny its faults. Any difficulties with product
candidates the company may fall upon or incredible developments, papers such as the
Seattle Times or the Eastside Journal are quick to report it, as is the televised news.
Reliable and authoritative, these media sources do not skew the truth, trying to
manipulate the public; rather, they are dependable and can be relied upon relaying with
accuracy, the press release from the company straight to the community. If someone
were to contact ICOS Corporation in concern to public relations, one could either go to
their website, www.icos.com, and either e-mail the company or get the telephone number
for public relations. At the end of every press release on the website, there is the name of
a contact person and number for PR, if any questions or concerns of the release arise.
Information concerning ICOS Corporation and its process of developing product
candidates has been from Chris DiPalma, an employee within preclinical at the company.
Mr. DiPalma was the mentor behind the project assisting at any time. For the interview,
located at ICOS Corporation in Bothell, Mr. DiPalma and I sat down for approximately
one and a half to two hours discussing how ICOS develops its products and the extensive
process a company must go through to develop a drug to meet medicinal needs.
There was not a job shadow conducted, just the interview, however as Chris
DiPalma has only worked with ICOS for approximately three to four months and did not
know much of the business side of ICOS, he helped my contact Diane Rosman within
human resources. Ms. Rosman answered all of my questions concerning financial data,
history of the company, careers within ICOS and organization of the company. Through
Mr. DiPalma and Ms. Rosman, I was directed to the company website and any questions
the two could not answer, or was already on the site, I could gather my own information
from there. Mr. DiPalma helped me with the scientific aspect of the company while
Diane handled the business side. All throughout my research, Mr. DiPalma was still my
mentor and would not hesitate to gather any resources he could find to assist me, i.e.
Diane Rosman, is strewn throughout the paper. The two were extremely helpful in
gathering information concerning ICOS that was not readily available of the website.
The future of ICOS Corporation seems bright as they now have a product released
in Europe with the pending approval from the FDA for the United States. Also, with
various product candidates in clinical trials and others in research, several more products
are soon to be released in later years. Challenges, however, that ICOS may face, is
another product similar to Pafase that will seem to be doing fine in clinical trials, but may
end up terminated. Results like this are not good for the company as it not only is one
less product for ICOS, because millions of dollars are put forth for each candidate and
any more with a fate comparable to Pafase, would not profit ICOS. Products expected to
come to market in the future would be the ones in clinical trials outlined earlier:
Sitaxsentan, IC747, IC14, RTXTM, TBC3711, and IC485. Sitaxsentan, as it is the farthest
along in clinical trials, would most likely prove to be the next on the market, but only
time will tell.
With an expanding company, through new product development, many new
employees are needed as positions open up form new demand. However, new markets
outside of biopharmaceuticals does not seem likely, as it is the company’s main
objective. New markets, at least immediately, would be too much expansion for this size
of a company, due to the new success in biopharmaceuticals. Further growth will be
managed as it has before, as it has gotten ICOS thus far. With the success of CialisTM and
future products on the market, ICOS Corporation is a successful company with an
exceptionally optimistic future.
Notes from interview with Chris DiPalma: December 23, 2002
-proof of concept
-Phase 1-normal, healthy, small study – show safety
-Phase 2-show efficacy – tested in “sick”
-Phase 3-large “multisite” in “sick” patients
-makes or breaks drug
-non-human primates? (preclinical)
examples of majors/degrees
Manufacturing tied into development (mostly clinical)
Clinical Development→IND to FDA
Manufacturing also goes into IND and FDA (also European)
DiPalma, Chris. Interview. 23 Dec. 2002.
ICOS Corporation Online. 26 Feb 2003. ICOS Corporation. 27 Feb. 2003
“Icos’ impotence drug set for European sales.” Seattle Times. 23 Jan. 2002.
Lord, Steven. “Bothell biotech gets top rating.” Seattle Times. 23 Feb 2003.
Rosman, Diane. “RE: Student Biotech Expo.” E-mail to the author. 17 Jan. 2003.
“The Perils of Pharmaceuticals.” Editorial. Seattle Times. 27 Dec. 2002.
Credibility of sources:
-Chris DiPalma is an employee of ICOS Corporation with extensive experience within
the biopharmaceutical industry.
-The online website for ICOS Corporation is the company’s own website, with facts, data
and press releases directly from the company itself.
-The Seattle Times is an authoritative media source in the Puget Sound region that can be
relied upon for honesty and holds a high level of integrity. The editorial was used to get a
sense of emotion about the drug and the downside to the pharmaceutical industry
-Diane Rosman is in human resources at ICOS Corporation and very well knows the
business side of the company and can be relied upon for data and facts about the