ICN Blames Regulators for Giving Up on AIDS Drug : Medical: The Costa Mesa pharmaceuticals firm has a long history of tangling with various federal agencies.
Milan Panic, the volatile founder and chief executive of ICN Pharmaceuticals, isn’t a man who gives up easily.
For more than four years, he has been unbending in his determination to win approval from the Food and Drug Administration to sell the anti-viral drug ribavirin as a treatment for AIDS.
Even after the FDA said in 1987 that it could find no evidence of ribavirin’s effectiveness against Acquired Immune Deficiency Syndrome, Panic kept a stiff upper lip, saying, “If as strong a person as I quits, then others will too.”
But Wednesday, the Costa Mesa firm and its strong-willed leader put out a white flag of surrender, announcing that the company had dropped its efforts to win approval to use ribavirin as an AIDS treatment in the United States.
The decision was costly for ICN, which reported an $82-million loss for fiscal 1989 largely because of a writedown related to its ribavirin operations. But it does not end the controversy surrounding ICN, which over the years has prompted investigations by the FDA, Securities and Exchange Commission, a federal grand jury and Congress.
Panic said Thursday that he gave up the battle with the FDA because he believed there was no way for him to win.
“While clinical results and the needs of AIDS patients warrant further clinical studies of ribavirin, ICN itself will not at the present time pursue marketing authorization in the U.S. as long as regulatory attitudes and policies remain the same,” he said.
ICN officials say the company is still confident of the value of ribavirin and will now focus on getting it accepted by other countries as an anti-AIDS drug. They say the company also will try to persuade the FDA to allow ribavirin to be sold in the United States as a therapy for various other maladies, including influenza.
The company, which has invested $20 million to develop ribavirin as an FDA-approved drug for fighting early-stage AIDS, was discouraged by the high cost and complexity of the task, said company spokesman Jack Sholl.
The FDA has denied two applications by ICN for approval to market ribavirin for use in life-threatening cases based on data from clinical studies that the company has sponsored. A third application was voluntarily withdrawn by the company in November.
Even some staunch supporters of ribavirin and ICN say the company created its difficulties with the FDA by its own behavior.
“If they had followed the normal scientific peer review process and played ball with the FDA, the drug would be on the market already (for AIDS),” said Eugene Melnitchenko, analyst for Guerin & Turner Inc., a Dallas brokerage.
The FDA denies Melnitchenko’s contention that its rejection to date of ribavirin as an AIDS drug has been in any way “political.”
“We review drugs on the basis of their safety and efficacy, and we don’t allow political consideration to interfere with those decisions,” said FDA spokesman Brad Stone. He noted that the FDA in 1985 approved ribavirin for treating respiratory syncytial virus, the most prevalent cause of lung infections in infants.
Nonetheless, ICN has become the target of criticism and numerous investigations.
In 1988, at the behest of the FDA, a Los Angeles grand jury launched an investigation of allegations that ICN illegally offered to sell the drug for treating people with AIDS without government approval. No charges resulted.
Panic has drawn fire for his optimistic--some say “promotional”--comments about the drug’s powers.
The FDA’s wrangling with ICN dates to 1987 when company officials announced in a news conference that recent tests showed that ribavirin delayed the onset of AIDS. But a few months later, the FDA disputed the test results.
ICN’s stock performance has been a barometer of investors’ confidence in ribavirin’s potential as an AIDS drug. The stock tripled in price to a peak of $34 a share in August, 1986, then fell. It declined $1.125 on Wednesday’s news to close at $3.625 Thursday.
In 1987, the SEC began a two-pronged investigation of trading in the stock of ICN and its research subsidiary, Viratek Inc. One part of the SEC investigation was an allegation that Gilford Securities Inc., a Chicago-based brokerage, had attempted to drive down the price of ICN and Viratek stock in which it had taken a short position.
In turn, ICN filed suit against Gilford, charging the firm with fraudulently causing stock to drop by spreading “false and disparaging” information about the prospects of ribavirin.
The SEC also investigated allegations that ICN and Viratek had spread false information about the ribavirin’s efficacy and safety. ICN spokesman Sholl said Thursday that the SEC has completed that probe and begun discussions with ICN about a possible settlement.
