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Gilead beats views but hep C franchise topples again

July 26, 2017

Gilead Sciences (GILD) continued to feel heat in its hepatitis C drug franchise in the second quarter, but shares popped late Wednesday after the biotech’s total sales and profits per share topped Street views.

In after-hours trading on the stock market today, Gilead was up 2.6% to 76.10 in recent action. Shares closed the regular session up 0.6%, at 74.19, and are now up 3.6% for the year and have stayed above their 50-day moving average since mid-June.

For the second quarter ended June 30, Gilead reported adjusted income of $2.56 per share on revenue of $7.14 billion, topping the consensus of analysts polled by Zacks Investment Research for $2.18 and $6.4 billion, respectively.

On a year-over-year basis, though, sales declined 8.2% and adjusted income fell 16.9%. Gilead’s three-drug hepatitis C unit dipped 27.5% to $2.9 billion due to lower sales of Harvoni and Sovaldi, partially offset by Epclusa sales, Gilead said.

HIV and hepatitis B drug sales rose 16.1% vs. the year-earlier period to $3.6 billion. Gilead cited continued uptake of HIV drugs using tenofovir alafenamide, as well as Genvoya, Descovy and Odefsey, all HIV drugs.

Gilead boosted its 2017 sales guidance to $24 billion to $25.5 billion, up from earlier views for $22.5 billion to $24.5 billion. Hepatitis C drugs are expected to comprise $8.5 billion to $9.5 billion of that total with other products bringing in $15.5 billion to $16 billion in sales.

Analysts will be looking for Gilead to comment during its earnings conference call on the potential for mergers and acquisitions. Gilead’s hepatitis C drug franchise has struggled in recent quarters and the company has said it’s on the lookout for an acquisition in the cancer space.

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