Tar Heel biotech stocks have a life of their own.

Biotechnology is not a quick-buck business. It takes years and hundreds of millions of dollars to discover a drug, guide it through clinical trials and the federal approval process and market it before seeing revenue, much less profit.

Two small companies in the Triangle, a hotbed of biotech start-ups, have taken a similar route to reduce that risk. Barebones corporate structures, Medco Research Inc. (MRE-AMEX) and Intercardia Inc. (ITRC-NASDAQ) buy or license cardiovascular drugs that others discover, then farm out manufacturing, sales and distribution.

But both are paying for the uncertainty of getting their products to market with sluggish stock prices. Analysts, however, expect the stocks to rise as their drugs approach approval.

Medco, which went public in 1984 and moved to RTP in 1993, acquires drugs in late-stage testing, directs clinical trials, guides the drugs through Food and Drug Administration approval and licenses out manufacturing and marketing for a 25%-30% royalty on sales. It employs only 25 full time.

One of its drugs awaiting approval is ViaScint, which helps identify patients who would benefit from bypass surgery. Approval, possibly in a year, would give Medco a shot at a large market. About 700,000 bypasses are performed each year in the United States and Europe.

Another Medco drug is BiDil, for treating congestive heart failure. It could also be approved in a year and generate $60 million to $80 million in annual sales, says analyst John R. Boettiger of Harris Webb & Garrison in Houston.

Medco already receives royalties from two drugs. Adenocard, introduced in 1989, treats irregular or rapid heartbeat. Adenoscan, which hit the market in July 1995, is for patients who can't use a treadmill during cardiac stress testing. Both drugs, manufactured and marketed in the United States and Canada by Fujisawa USA Inc., generated nearly $50 million in sales in 1995 (Medco pays half its Adenocard royalties to a University of Virginia foundation). Adenoscan sales could reach $200 million to $300 million in a year or two, Boettiger says.

Medco expected to turn a full-year profit for the first time in 1996. Boettiger projected earnings of 40 cents a share on royalty of $18 million to $20 million, compared with a loss of 32 cents a share on almost $10 million a year earlier. "On a pure product basis, it's ideally positioned for cardiovascular diagnostic work," he says, "and from a pure financial standpoint, it's debt-free, with close to $4 a share in cash."

At year-end, the stock traded at $10.50, 13% off its 52-week high. Favorable news from the FDA on BiDil and ViaScint and partnership deals for them could boost the stock, analysts say. They also expect Medco to acquire some small companies or products. Boettiger says the stock could trade between $18 and $20 over the next year.

Intercardia is a riskier bet. Unlike Medco, the 2-year-old company doesn't have any drugs on the market and probably won't report operating earnings for at least two years. It's betting on bucindolol, a beta blocker for congestive heart failure. Intercardia, which employs 17, went public at $15 a share in February as a spinoff of Lexington, Mass.-based Interneuron Pharmaceuticals Inc., which owns about 60% of the company.

Bucindolol is in late-stage clinical trials. By mid-December, more than 1,380 patients had enrolled toward a maximum of 2,800. If all goes as planned, the drug could reach market in early 1999. Astra Merck, a joint venture of New Jersey-based Merck & Co. and Astra AB of Sweden, will handle marketing and manufacturing. Sales are projected to reach $620 million by 2001. Intercardia will get 15% of sales up to $110 million and 30% on sales over that.

SmithKline Beecham PLC's beta blocker, carvedilol, might hit the market first. The British-based giant suffered a setback in May when the FDA rejected the drug because of a testing flaw. Bucindolol still might have an edge because patients have shown better tolerance and fewer side effects, Montgomery Securities analyst David K. Crossen says.

"We have one egg, but it's a good egg," Intercardia CEO Clayton Duncan says of bucindolol. "But we won't be a one-egg company forever." The company is developing what's called catalytic anti-oxidant small molecules as therapy for a variety of conditions, including strokes and asthma.

At year-end, Intercardia stock traded 40% below its 52-week high of $35.75, which it hit in May on news of SmithKline's setback. Analysts say Intercardia could get back to $35 in a year.