Gilead Reports Drop in Hepatitis C Drug Revenue
April 28 2016 - 5:00PM
Dow Jones News
Gilead Sciences Inc. said revenue from its hepatitis C drugs
fell 5.6% in the first quarter as sales of Harvoni and Sovaldi fell
short of expectations.
Shares in the company slid 5.3% in after-hours trading.
The Foster City, Calif., biopharmaceutical company dominates the
market for treating hepatitis C, inflammation of the liver that
doesn't always show symptoms. The contagious disease affects about
3.5 million people in the U.S., according to the Centers for
Disease Control and Prevention.
In the first quarter, Gilead said sales of Harvoni, its newer
treatment, fell 16% to $3.02 billion. Analysts were looking for
$3.15 billion, according to FactSet. Meanwhile, Sovaldi sales
jumped 31%, to $1.27 billion, but the increase fell short of
expectations amid soft European markets. Analysts had projected a
34% rise in Sovaldi sales to $1.30 billion.
Gilead is facing growing competition in the booming hepatitis
space. During the quarter, pharmaceutical giant Merck & Co.
launched a new treatment that costs 30% less than rival drugs and
comes in the form of a once-daily pill. Meanwhile, AbbVie Inc.
markets Viekira Pak, a competing and similarly costly treatment it
launched in late 2014.
Gilead has managed to protect its market share, but analysts
have cautioned that pressure is heating up. "People are worried
about the hepatitis C market," said RBC analyst Michael Yoon.
"Prices have gone down [and] there's increased competition," he
said.
The two Hepatitis C drugs make up about two-thirds of Gilead's
business. A chunk of the rest is from the company's HIV treatment,
what it was originally known for.
In all for the quarter, Gilead reported a profit of $3.57
billion, or $2.53 a share, down from $4.33 billion, or $2.76 a
share, a year earlier. Excluding acquisition-related expenses,
stock-based compensation and other items, per-share profit rose to
$3.03 from $2.94.
Total product sales rose 3.7% to $7.68 billion. Analysts
projected $3.15 in adjusted earnings per share on $8.12 billion in
sales, according to Thomson Reuters.
The company backed its guidance for the year, still projecting
$30 billion to $31 billion in total sales.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
(END) Dow Jones Newswires
April 28, 2016 16:45 ET (20:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Merck (NYSE:MRK)
Historical Stock Chart
From Aug 2024 to Sep 2024
Merck (NYSE:MRK)
Historical Stock Chart
From Sep 2023 to Sep 2024