Gilead Sciences (GILD) beat Wall Street’s first-quarter sales forecasts on Thursday due to its Covid treatment, Veklury. Gilead shares rose sharply in late trading.
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However, two of Gilead’s three cancer drugs – cell therapy Tecartus and antibody drug conjugate Trodelvy – fell short of expectations. Tecartus treats forms of lymphoma and leukemia, while Trodelvy is used to treat breast and bladder cancer. However, sales of the cell therapy Yescarta exceeded estimates. Yescarta treats lymphoma.
Combined, all three drugs brought in $789 million, falling $11 million short of expectations.
Andrew Dickinson, Gilead’s chief financial officer, says acceptance of cell therapies is slowly improving. Cell therapy is the development of tailored cancer treatments using a patient’s own immune cells. He expects momentum to increase towards the end of this year due to improvements in the sales team and better market dynamics.
“These are important growth businesses for us,” he told Investor’s Business Daily. “These franchises have a long future ahead of them in terms of market exclusivity.”
Gilead shares fell 2.7% to 65.27 during the regular session after IBD’s biotech industry group fell less than 1.5%. Shares rose more than 3% to 67.54 in after-hours trading.
Gilead Stock: HIV Drugs Mixed
Overall, Gilead’s revenue rose 5% to $6.69 billion, beating forecasts of $6.36 billion, according to FactSet.
The company lost an adjusted $1.32 per share after taking a $3.9 billion tax hit due to its acquisition of CymaBay. Gilead has since applied for approval for Seladelpar from CymaBay. Seladelpar was tested in patients with a rare liver disease.
Without that, Gilead would have beaten earnings expectations at $1.82 per share, Chief Executive Daniel O’Day told IBD. In the same period last year, Gilead earned $1.37 per share.
Revenue from Gilead’s biggest moneymaker, an HIV drug called Biktarvy, rose 10% to $2.95 billion, topping forecasts of $2.9 billion. However, Descovy’s revenue was low at $426 million, down 5%. Dickinson, Gilead’s CFO, says patients are switching from the old products to Biktarvy, a newer drug.
Later this year, Gilead expects to market lenacapavir, a “paradigm-changing” treatment for HIV, Dickinson said. The company tested lenacapavir as an injection every six months to treat HIV. He expects Gilead to receive approval and bring lenacapavir to market as an HIV prevention drug in 2025 – the same market in which Descovy has a significant presence.
It will be important to monitor “how we manage Descovy during this paradigm-shifting launch,” he said.
Veklury lends itself to a different beat
For the second quarter in a row, Gilead’s Covid treatment Veklury posted a significant increase in sales. Veklury’s revenue fell 3% to $555 million, but beat forecasts of $375 million. According to O’Day, the CEO, trends at Veklury reflected the first quarter of 2023. The drug is still used in about 60% of patients hospitalized with Covid in the U.S. and abroad.
“It was a significant increase compared to Wall Street expectations and a good start to the year,” he said.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
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