I saw this film recently on Sundance (or IFC) after not seeing it for years. It's a really perplexing work. As a time capsule, it's fascinating. It was shot in NYC in 1980 when the city was dying all around, and many of these gay "meat markets" were in full swing. The gay bar scenes are incredibly intense and realistic, and they can still shock most viewers today. The film has a real dirge, detached atmosphere to it, giving it an unexplainable vibe. The dialogue is flatly rendered, and at first I disliked this. This may have been due to gay groups very loud protests during the actual shooting. While they were location shooting in NYC, various gay groups disturbed the filming by shouting, whistling, blowing off sirens, etc., etc., in other words, they made sound recording almost impossible. On the featurette (which is fascinating), the producer and Friedkin said they took a month and a half to do ADR (automatic dialogue replacement) on the film. I believe gay groups were angry that the "leather scene" was the only type of gay subculture portrayed in the film, and I understand their concerns, but that was no reason to attempt and stop the film being made, which is essentially what they did.
The film's plot isn't particularly well developed, and Pacino's character is mostly confused (as is his performance, which supposedly he was unhappy with). Friedkin made one of the greatest gay films ever with The Boys in the Band, but here his film feels exploitative, like he enjoyed showing the bondage/leather gay scene of NYC instead of showing relatively straightforward gay people. The film feels unfinished, but not by design. The only deliberate ambiguity I feel is the ending. SPOILER. The killer is caught, but a murder happens after the killer is caught which is indirectly connected to the case, and that really leaves a creepy vibe when the film ends.
Look quickly for James Remar and Ed O'Neil as a gay roomate and a detective, respectively. The film is worth watching at least once, but it's not a "lost masterpiece".