Gilead Sciences Inc. said its two key hepatitis C drugs, Sovaldi
and Harvoni, generated about $4.45 billion in sales in the first
quarter, topping Wall Street estimates, thanks to better than
expected sales of Harvoni.
For the year, Gilead raised its guidance for net product sales
by $2 billion and now expects $28 billion to $29 billion.
Shares rose 1.8% to $102.29 in recent after-hours trading.
The drugs represent two of the most successful drug launches
ever, marked by their high cure rates, fewer side effects and
imposing price tags; however, they also face increasing competition
from new hepatitis C treatments like AbbVie Inc.'s Viekira Pak,
which started sales in December. Merck & Co. has a hepatitis C
treatment in the works.
For the quarter ended March 31, Sovaldi had sales of $972
million, a decline 57% from a year earlier and its lowest total
other than the quarter it first came to market.
Harvoni, which combines Sovaldi with another drug and received
regulatory approval in October, had $3.58 billion in sales in its
second quarter on the market, compared with $2.11 billion in the
previous quarter.
Analysts were expecting sales of $1.33 billion for Sovaldi and
$2.197 billion for Harvoni, according to a note by Evercore ISI
analyst Mark Schoenebaum.
Investors likely will be watching for signals of how prices for
hepatitis C drugs will be affected by increased competition and
discounts offered to win preferential treatment on health plan
formularies. In February, Gilead estimated discounts that it gives
on new hepatitis C drug would more than double this year.
Some health plans and drug-benefit managers have complained
about the high cost of Sovaldi and Harvoni, which carry price tags
of $1,000 a day or more for certain patients. Rival Viekira Pak has
won preferential treatment on some formularies after AbbVie offered
undisclosed discounts.
Overall, Gilead reported a profit of $4.33 billion, or $2.76 a
share, up from $2.23 billion, or $1.33 a share, a year earlier.
Excluding items such as acquisition-related, restructuring and
stock-based compensation expenses, per-share earnings rose to $2.94
from $1.48. Revenue surged 52% to $7.59 billion.
Analysts polled by Thomson Reuters expected per-share profit of
$2.32 and revenue of $6.92 billion.
Write to Tess Stynes at tess.stynes@wsj.com
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