Drug Shares Up on Rumor of Takeover Attempt by Kodak

Fueled by rumors of a possible takeover bid by Eastman Kodak, common shares of ICN Pharmaceuticals Inc. and its Viratek Inc. subsidiary continued Thursday to rise sharply.

Viratek, traded over the counter, closed Thursday at $63 a share, up $5 from the previous day, when it had shot up $8.75, making for a two-day gain of 28%.

Equally dramatic was the 27% increase in ICN’s price over the last two days. Traded on the New York Stock Exchange, ICN hit a new 12-month high to close Thursday at $16.50 a share, up $1.25 for the day. On Wednesday, the issue gained $2.25 a share. ICN owns about 47% of Viratek.

Wall Street analysts attributed this week’s run-up to speculation that Rochester-based Kodak, which already owns 5% of ICN and 10% of Viratek, may seek to acquire one or both of the Costa Mesa companies.

Earlier this week, Colby Chandler, Kodak’s chairman, said, “There is a 100% likelihood” that Kodak will make acquisitions that would permit it “to participate fully in the pharmaceuticals industry.”

However, Kodak flatly denied Thursday any designs on either ICN or Viratek.

“Kodak has no plans to acquire ICN or Viratek,” said Henry Kaska, a company spokesman, who stressed that in addition to ICN, Kodak has joint ventures with several pharmaceutical and biotechnology firms.

When reached Thursday, Dominic Liuzzi, a spokesman for ICN and Viratek, declined to comment on the takeover rumors, citing pending offerings by ICN of 2 million shares of common stock and $100 million in debt.

Despite the hefty increases in ICN and Viratek, shares of SPI Pharmaceuticals Inc., a second ICN subsidiary, fell 25 cents Thursday to close at $18.50. On Wednesday SPI shares gained $1.25 a share to close at a 52-week high of $18.75. SPI’s low for the 12 months is $10.75.

ICN’s low price during the past 12 months is $8.50 a share, while Viratek’s low price during the same period is $13.75 a share.