Year Established: 1987
Revenues: $32,639 (+31%)
Net Income: $18,108 (+50%)
R&D: $3,014 (+6%)
TOP SELLING DRUGS
|Harvoni||chronic hepatitis C||$13,864||552%|
|Sovaldi||chronic hepatitis C||$5,276||-49%|
|Viread||chronic hepatitis B||$1,108||5%|
Having been referred to as “the Apple of healthcare” another jump for Gilead in the 2015 rankings has the burgeoning biotech up two spots to number 7. While the company’s growth is impressive, driven by staggering Harvoni and Sovaldi sales of $13.9 billion and $5.3 billion, respectively, maintaining this surge within a more crowded Hep C market may prove difficult. Despite pricing pressures and competition for its top Hep C sellers, it still holds a solid 90% market share. Gilead also maintains its dominant position with its growing flagship HIV franchise.
The first quarter of 2016 saw revenues up 3% to $7.8 billion, while net income was down 16% to $3.6 billion due to acquisition-related, up-front collaboration, stock-based compensation expenses, as well as reflecting lower revenues in the Hep C arena. Antiviral product sales, which include HIV and liver disease areas, were $7.2 billion, up 3%. Truvada sales were up 16% to $898 million, Atripla sales declined 8% to $675 million due to patent expirations, and Stribild sales were up 34% to $477 million. While Harvoni sales slipped 16% in the first quarter, Sovaldi sales were up 31%.
The Hep C market saw a significant drop in prices as a result of the launch of Merck’s Zepatier in January, which considerably undercut both AbbVie’s Viekira Pak and Gilead’s Harvoni on price—not to mention this strategy could give payers the leverage needed to negotiate even further discounts. Viekira Pak launched in December 2014, just two months after Harvoni was approved, and exclusive deals with insurers to cover the drug in return for discounts quickly ensued. Gilead was forced to do the same, impacting 1Q16 sales.
Compared to its closest competitors, AbbVie, Merck, and Celgene, Gilead’s financials and assets appear in good working order, and its pipeline comprises several late-stage product candidates for high value indications, namely cancer, heart disease, and HIV. While these candidates are not likely to have the financial impact of Harvoni and Sovaldi, they’re diversified and have the potential to replace some of the lost revenue in the Hep C arena, which, due to the curative nature of these therapies, is not likely to be able to support multiple blockbusters long term.
Additions to Gilead’s HIV therapies include the FDA approval of Odefsey (emtricitabine /rilpivirine /tenofovir alafenamide or R/F/TAF) for the treatment of HIV-1 infection. Odefsey is Gilead’s second TAF-based regimen to win FDA approval and represents the smallest pill of any single-tablet regimen currently available for the treatment of HIV. The drug will likely gain EU approval as well, with the European CHMP adopting a Positive Opinion for Odefsey this past April. Emtricitabine and tenofovir alafenamide are from Gilead, while rilpivirine is from Janssen Sciences Ireland.
The European Medicines Agency (EMA) also adopted a positive opinion for two doses of Descovy (emtricitabine 200 mg/tenofovir alafenamide 25 mg, F/TAF), an investigational fixed-dose combination for the treatment of HIV-1 in combination with other antiretroviral agents.
Antiviral asset bictegravir (GS-9883), an investigational integrase strand transfer inhibitor achieved proof-of-concept based on data from four preclinical and Phase I studies evaluating the antiviral potency, resistance profile, pharmacokinetics and safety. Bictegravir, including in combination with tenofovir alafenamide and emtricitabine as a single tablet regimen, is an investigational treatment for HIV currently in Phase III trials as part of the single tablet regimen.
In HCV, Harvoni picked up two supplemental indications for use in chronic hepatitis C patients with advanced liver disease. Also, the FDA granted priority review to the company’s NDA for an investigational once-daily fixed-dose combination of sofosbuvir and velpatasvir (SOF/VEL) for the treatment of chronic genotype 1-6 HCV infection. The FDA has set a target action date under the Prescription Drug User Fee Act of June 28, 2016.
Finally, while Gilead terminated its Phase II study of the investigational monoclonal antibody simtuzumab in patients with idiopathic pulmonary fibrosis (IPF) due to lack of efficacy, Phase II studies of simtuzumab are ongoing in patients with non-alcoholic steatohepatitis (NASH) and primary sclerosing cholangitis (PSC).
In addition to these pipeline assets, several noteworthy acquisitions and collaborations broadened Gilead’s portfolio. Most recently, the company acquired Nimbus Apollo and its Acetyl-CoA Carboxylase (ACC) inhibitor program for $400 million upfront, and an additional $800 million in development milestones. The Nimbus Apollo program includes the lead candidate NDI-010976, an ACC inhibitor, and other preclinical ACC inhibitors for the treatment of NASH, and for the potential treatment of hepatocellular carcinoma (HCC) and other diseases. NDI-010976 was Fast Tracked by the FDA in February 2016 and Phase I data for the compound is expected to be available soon.
Gilead also acquired EpiTherapeutics, a privately-held Danish company, for $65 million, gaining a portfolio of histone demethylases for the treatment of certain cancers.
Finally, Galapagos and Gilead Sciences completed the closing of their global license and collaboration agreement on filgotinib, triggering an upfront license fee payment of $300 million to Galapagos. Gilead has also made a $425 million equity investment in Galapagos and now owns 14.75% of its outstanding shares.
The companies entered a collaboration for the joint development and commercialization of filgotinib in inflammatory diseases in December 2015. Galapagos co-funds 20% of global development activities and Gilead is responsible for manufacturing and worldwide marketing and sales activities.
A Phase III program with filgotinib in rheumatoid arthritis will be initiated mid-2016. Filgotinib has also been shown to be safe and effective in moderate to severe Crohn’s disease, based on Phase II study results.
In executive news, as of March 2016, John C. Martin, Ph.D., chairman and chief executive officer of Gilead stepped down, assuming the role of executive chairman of the company. John F. Milligan, Ph.D., was promoted to CEO and will serve on the board of directors. Dr. Martin joined the company in 1990 and served as CEO since 1996. Dr. Milligan also joined Gilead in 1990 and most recently served as president and chief operating officer. Under Martin, Gilead grew from a small biotech worth $1 billion, to a top 10 biopharma company bringing in nearly $33 billion in 2015. If Dr. Milligan can keep pace in today’s challenging environment, Gilead’s outlook is strong.