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Lilly's sex drug sales jump in 2005
Cialis revenue surged 35 percent in '05, but the fight for sex drug market share gets brutal in '06.
By Aaron Smith, CNNMoney.com staff writer


NEW YORK (CNNMoney.com) - Sales for Lilly's anti-impotence drug grew dramatically in 2005, but Cialis' future and that of competing sexual dysfunction drugs remains uncertain.

Cialis, a drug for erectile dysfunction from drug maker Eli Lilly & Co. and partner ICOS, saw sales jump 35 percent in 2005 to $747 million, from $552 million in 2004, its first full year on the market.

Lilly ICOS, a joint partnership created in 1998 specifically for the launch and marketing of Cialis, announced the sales tally on Friday. Lilly (down $0.21 to $56.97, Research), which is traded on the NYSE, is scheduled to release its earnings on Jan. 26. ICOS (up $0.85 to $25.70, Research), traded on the Nasdaq, is to release its earnings on Feb.7, when it will also announce Cialis sales projections for 2006.

"Cialis has continued to gain in sales and our market share in 2005 also increased [to 25 percent,]" said ICOS spokeswoman Lacy Fitzpatrick. "We're delighted with our progress with Cialis. It's only been on the market since November, 2003."

Viagra, the erectile dysfunction drug from Pfizer (down $0.04 to $24.93, Research), commanded 60 percent of market share in 2005, while Levitra from Bayer (down $0.38 to $41.57, Research), GlaxoSmithKline (down $0.56 to $50.19, Research) and Schering-Plough (down $0.25 to $19.98, Research) took 14 percent, said Barbara Ryan, analyst for Deutsche Bank North America, in a recent interview.

While Cialis sales ramped up in 2005, Viagra sales wound down. Viagra sales declined 2 percent to $1.6 billion in 2005, said Pfizer in its earnings report on Thursday. Viagra sales dropped 8 percent in the fourth quarter to $430 million. Pfizer attributed the sales decline to "slower growth in the overall erectile-dysfunction market and competition from other products."

Full year sales figures for Levitra are not yet available.

Competition heating up in 2006

Prior to today's report, Al Rauch, analyst for A.G. Edwards & Sons, projected that Cialis sales would reach $900 million in 2006. Many analysts believe that the market for sexual dysfunction drugs has reached capacity, meaning more intensified competition between drug makers as they battle for market share.

Lilly spokesman Phil Belt said the sales growth for Cialis was "built largely on market share gain" and Lilly is marketing its product as significantly different from its competitors. Belt said that Cialis has a "convenient" 36-hour window for men suffering from impotence, allowing them to achieve erection during that time if stimulated.

Pfizer is also trying to expand market share with a recently launched education campaign about erectile dysfunction that does not specifically mention Viagra, to try and convince men with erectile problems to get past the embarrassment and seek treatment.

The anti-impotence drugs work by improving blood circulation, allowing impotent men to achieve erections.

To read about anti-impotence drug projections for 2006, click hereTop of page

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