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Telegraph
30-06-2025
- Business
- Telegraph
This firm represents one of investing's toughest moral debates
While many big drug companies do amazing things for humanity, they're also often vilified for profiteering from their work. This month, New York-listed Gilead Sciences has, not for the first time, reminded investors of the conundrum. On June 18, Gilead announced it had gained approval from the US regulator for a treatment that some view as having the potential to end the global 'HIV epidemic'. At the same time, it has drawn criticism in anticipation of US prices being set at more than $28,000 (£20,400) per patient, per year. Lenacapavir, to be marketed by Gilead under the name Yeztugo, is a twice-yearly injection that prevents people from contracting HIV. This has the potential to disrupt the market for preventative HIV drugs, which is currently dominated by another Gilead treatment, a daily pill named Descovy. Financially, Gilead hopes to gain from lenacapavir by expanding the market for preventative HIV treatments. It also could benefit from existing users of Descovy switching to the somewhat more expensive new treatment, and people switching from other long-lasting preventatives such as GSK's bi-monthly Apretude. The breakthrough is important in strengthening Gilead's HIV franchise more broadly, too. HIV drugs accounted for almost 70pc of product sales last year, and year-on-year growth of HIV-related revenues came in at 8pc in the first quarter. The group's single biggest-selling drug is Biktarvy, a treatment for people who are already HIV positive. The daily oral pill generates around $13.4bn of sales, or 47pc of the group total. Gilead is currently leveraging its research into lenacapavir by attempting to develop a twice-yearly treatment in this space, too. Gilead's major drug breakthroughs have not always proved as rewarding for shareholders as they have for patients. Covid-19 sent the shares on a roller-coaster ride after one of Gilead's hepatitis C treatments, called Remdesivir, was originally found to also be very effective against the coronavirus. Sales of the drug, rebranded Veklury, hit $5.6bn in 2021 but rapidly fell as the pandemic eased, and revenues are expected to be just $1.3bn this year. An earlier breakthrough in the treatment of hepatitis C in the 2010s, meanwhile, caused huge share price excitement, with revenues ballooning to nearly $14bn in 2015 before the drug became a victim of its own success. Because the drug, called Harvoni, found a way to cure the disease as opposed to managing it, it did away with much of its own market. Rising competition also contributed to a rapid decline in sales. However, many top investors are more bullish on the lenacapavir breakthrough. Financial publisher Citywire, which tracks where the world's best fund managers are investing, has found 12 backing the shares – all among the best-performing 3pc of equity managers globally. The level of these bets puts Gilead among the 74 stocks that make up Citywire's Global Elite Companies index, which represents the very best ideas from the roughly 6,000 stocks held across the portfolios of top fund managers. Optimism about Gilead's prospects can be seen in its share price, too. The valuation against forecast earnings is within the top 5pc of the 10-year range. While in some circumstances this would be grounds to worry about the shares being expensive, the fact Gilead is only valued at 13 times forecast earnings makes it is more a reason to take heart than worry. Indeed, the uninspiring valuations of previous years reflect the ups and downs associated with Veklury and Harvoni. Today, the future looks much brighter. Sales of Veklury appear to be stabilising and now represent a relatively small proportion of the business. Meanwhile, as well as the strong HIV franchise, the company is experiencing solid growth in cancer and liver disease treatments. The drug development pipeline also looks strong, and is supported by about a fifth of sales going into research and development (R&D) each year. The group also does not face any major loss of patents until 2033. Meanwhile, attempts to drive down operating costs are benefiting the bottom line. The good progress has been reflected in analysts raising their earnings forecasts over the last 12 months. Expectations for the current year and next are both up by more than 10pc over the period, and while there is some downward pressure on revenue from US drug pricing policies, Gilead looks relatively well placed due to its focus on novel medicines. Its extensive US operations also reduce the threat from tariffs. The shares offer an attractive 3pc forecast dividend yield, and the company has a strong track record for returning cash. British buyers of the shares, which are available through all the big broking platforms, need to fill out the current paperwork to minimise withholding tax and should also check for any extra dealing charges. While walking the tightrope between profit and purpose is never easy, as an investment, Gilead looks better placed than it has for quite some time. Questor says buy Ticker: NYSE:GILD
Yahoo
16-06-2025
- Business
- Yahoo
RBC Capital Lifts Gilead Sciences (GILD) PT to $95 On Insights From a 2022 Patient Survey
Gilead Sciences Inc. (NASDAQ:GILD) is one of the 11 most profitable NASDAQ stocks to buy now. On June 11, RBC Capital increased its price target for Gilead Sciences to $95 from $92, while maintaining a Sector Perform rating. This adjustment is based on insights from a 2022 patient survey, which assessed perceptions of lenacapavir among high-risk individuals on and off PrEP (pre-exposure prophylaxis), especially after phase 3 data release and in anticipation of its potential market launch. The firm's analysis suggests that high clinician engagement, lower-than-expected adherence to oral PrEP medications, and the potential for current PrEP users to switch to lenacapavir could all facilitate growth for Gilead Sciences, even with some cannibalization of its existing product called Descovy. A physician and a patient having a discussion in a hospital about biopharmaceutical medicines. In Q1 2025, Gilead Sciences reported total revenue of $6.67 billion, which was flat year-on-year and missed Street's estimates by 2.1%. Despite the revenue miss, Gilead reconfirmed its full-year revenue guidance at the midpoint of $28.4 billion, which is 1.1% below analysts' estimates. These results were driven by growth in the company's core HIV and liver disease segments, particularly from strong demand for Biktarvy and the ongoing launch of Libdelzi. Gilead Sciences Inc. (NASDAQ:GILD) is a biopharmaceutical company that discovers, develops, and commercializes medicines in the areas of unmet medical need in the US, Europe, and internationally. While we acknowledge the potential of GILD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the . READ NEXT: and . Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
15-06-2025
- Business
- Yahoo
RBC Capital Lifts Gilead Sciences (GILD) PT to $95 On Insights From a 2022 Patient Survey
Gilead Sciences Inc. (NASDAQ:GILD) is one of the 11 most profitable NASDAQ stocks to buy now. On June 11, RBC Capital increased its price target for Gilead Sciences to $95 from $92, while maintaining a Sector Perform rating. This adjustment is based on insights from a 2022 patient survey, which assessed perceptions of lenacapavir among high-risk individuals on and off PrEP (pre-exposure prophylaxis), especially after phase 3 data release and in anticipation of its potential market launch. The firm's analysis suggests that high clinician engagement, lower-than-expected adherence to oral PrEP medications, and the potential for current PrEP users to switch to lenacapavir could all facilitate growth for Gilead Sciences, even with some cannibalization of its existing product called Descovy. A physician and a patient having a discussion in a hospital about biopharmaceutical medicines. In Q1 2025, Gilead Sciences reported total revenue of $6.67 billion, which was flat year-on-year and missed Street's estimates by 2.1%. Despite the revenue miss, Gilead reconfirmed its full-year revenue guidance at the midpoint of $28.4 billion, which is 1.1% below analysts' estimates. These results were driven by growth in the company's core HIV and liver disease segments, particularly from strong demand for Biktarvy and the ongoing launch of Libdelzi. Gilead Sciences Inc. (NASDAQ:GILD) is a biopharmaceutical company that discovers, develops, and commercializes medicines in the areas of unmet medical need in the US, Europe, and internationally. While we acknowledge the potential of GILD as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the . READ NEXT: and . Disclosure: None. This article is originally published at Insider Monkey.
Mint
05-06-2025
- Business
- Mint
A new shot prevents HIV—and breathes new life into a stagnant biotech
Later this month, the Food and Drug Administration is widely expected to approve a groundbreaking twice-yearly injection to prevent HIV—a milestone in the decadeslong fight against a once-devastating disease. For Gilead Sciences, the dominant player in HIV treatment, the breakthrough is doing what years of splashy but underwhelming acquisitions failed to achieve: It has Wall Street paying attention again. Since reporting last June that just two annual shots of lenacapavir prevented all HIV infections in a study of women and girls, shares have surged 73%. Gilead still isn't very expensive: It trades at 13.3 times forward earnings—below the industry average of 14, as measured by the NYSE Arca Pharmaceutical Index, and hardly a stretch for a company on the cusp of a new product cycle. Investors might fear they have seen this movie before. A decade ago, Gilead stock soared on excitement over its hepatitis C cure, only to stall once most patients had been treated and the market dried up. The company then fell into value-trap territory, weighed down by sluggish growth and a string of underwhelming cancer deals. This time could be different—but only if Gilead can execute. Over 400,000 people in the U.S. are currently on pre-exposure prophylaxis, or PrEP—a medication that protects against HIV infection. To hit the $4 billion in annual sales that some analysts are forecasting by the end of the decade, the company will need to not only convert a big chunk of existing patients but also expand the overall market both at home and abroad. Gilead expects the number of users in the U.S. to grow to over one million in the next decade. The early signs are promising. For starters, the market is growing fast. Sales of Gilead's daily pill Descovy rose 38% last quarter from a year ago, while GSK's Apretude—a long-acting injection given every two months—jumped 63%. Secondly, many current and potential users say they would prefer a longer-acting injection. A Jefferies survey of more than 500 PrEP users found that 95% would switch to a twice-yearly injection. In an interview, Gilead's Chief Commercial Officer Johanna Mercier said the key advantage of the company's upcoming HIV prevention shot isn't just efficacy but adherence. 'We know it's challenging to take a daily pill for prevention, and we see an incredible opportunity here," she said, citing data showing that many patients struggle to stay consistent with oral PrEP. Still, hurdles remain. Stigma continues to hinder PrEP uptake, particularly outside the core demographic of white men who have sex with men. Black Americans account for 39% of new HIV diagnoses but just 14% of PrEP users. Expanding access to underserved populations will require continued insurance coverage. While most current users are covered by commercial insurance, Medicaid will be key to reaching lower-income groups—making recent GOP proposals to cut the program a potential threat to Gilead's growth strategy. Another risk, according to RBC Capital Markets analyst Brian Abrahams, is cannibalization. Gilead's daily pill Descovy currently accounts for 40% to 45% of the PrEP market, so some of the lenacapavir growth could come at the expense of its existing business. But Mercier is confident the new product will expand the market both in the U.S. and globally. Gilead is working with governments in countries such as the U.K., where PrEP awareness is low, and planning broader rollout in low-income countries through partnerships with global health organizations. 'We're thinking globally about the public health impact we can have," she said. Gilead's growth outlook means it is, for now, steering clear of the patent cliff that is about to hit much of the industry as multibillion-dollar blockbuster drugs face generic competition. Gilead's HIV blockbuster, Biktarvy—which is prescribed after infection—retains exclusivity until 2033, with several potential successors already in the pipeline. Beyond HIV, Gilead is beginning to show signs of turning the corner in cancer, a space where past acquisitions have frustrated investors. There is growing excitement around Trodelvy—an antibody-drug conjugate acquired via its $21 billion Immunomedics deal—after data showed it delayed progression in an aggressive form of breast cancer when combined with Merck's Keytruda. Meanwhile, Gilead's cell therapy program is gaining traction, with the company aiming to challenge Johnson & Johnson in the multibillion-dollar multiple myeloma market, explains Traver Davis, a healthcare strategist at Citi. 'They have been hammered for their acquisitions and execution on the oncology side of the business in the last few years," said Davis. 'The narrative on that is definitely turning." Gilead spent years trying to move beyond HIV. In the end, it might be HIV prevention that finally delivers the breakthrough investors have been waiting for. Write to David Wainer at
Globe and Mail
30-05-2025
- Business
- Globe and Mail
Gilead Sciences Stock Gains 21% YTD: Buy, Sell or Hold?
Biotech giant Gilead Sciences, Inc. GILD has put up a strong performance amid a volatile market. Shares of this biotech giant have gained 21.1% year to date against the industry 's decline of 4.7%. The stock has outperformed the sector and the S&P 500 Index in this timeframe. Gilead Outperforms Industry, Sector & S&P 500 Index Gilead Sciences is a dominant player in the HIV market with market-leading treatments. Its diverse portfolio also includes drugs for liver, hematology/oncology and inflammation/respiratory diseases. Approval of new drugs, encouraging pipeline progress and positive data readouts have boosted investors' sentiment in the past six months. However, the oncology business is under pressure. Let's delve into GILD's strengths and weaknesses to analyze how to play the stock at present. GILD's Leading HIV Franchise Will Continue Its Momentum Gilead's flagship drug, Biktarvy (bictegravir 50 mg/emtricitabine 200 mg/tenofovir alafenamide 25 mg, BIC/FTC/TAF), for HIV-1 infection has become the number-one prescribed regimen for both treatment-naïve and switch patients. Biktarvy accounts for over 51% share of the treatment market in the United States and should maintain momentum for GILD in the upcoming quarters. Descovy (FTC 200 mg/TAF 25 mg) for pre-exposure prophylaxis (PrEP) is also witnessing good uptake. It maintains over 40% market share in the PrEP market in the United States. Gilead's efforts to innovate its HIV portfolio are impressive. Late-stage studies, PURPOSE 1 and PURPOSE 2, validated lenacapavir's potential to prevent HIV. The FDA accepted new drug application submissions for twice-yearly lenacapavir for HIV prevention under priority review, with a target action date of June 19, 2025. The European Medicines Agency validated the Marketing Authorization Application and EU-Medicines for All application for twice-yearly lenacapavir for HIV prevention. The successful development and potential approval of lenacapavir for the prevention of the disease should solidify Gilead's HIV franchise. Per GILD, lenacapavir, with its twice-yearly dosing, could set a new bar for HIV prevention and allow PrEP to reach a larger number of people who could benefit from a prevention regimen. Livdelzi Approval Strengthens GILD's Liver Disease Portfolio The FDA approval of seladelpar for the treatment of primary biliary cholangitis (PBC) has strengthened GILD's liver disease portfolio and validated its CymaBay acquisition. The drug's initial uptake is encouraging. The candidate was approved under the brand name Livdelzi. Gilead also recently received conditional marketing authorization from the European Commission for seladelpar for the treatment of PBC. Challenges for GILD's Oncology Business Gilead's oncology portfolio, comprising the Cell Therapy franchise and breast cancer drug Trodelvy, has diversified its overall business. However, the Cell Therapy franchise, comprising Yescarta and Tecartus, is currently under pressure due to competitive headwinds in the United States and Europe that are expected to continue in 2025. Breast cancer drug Trodelvy's sales were lower than expected in the first quarter due to inventory dynamics. Gilead announced positive top-line results from the phase III ASCENT-03 study on Trodelvy, which showed highly statistically significant and clinically meaningful improvement in progression-free survival in patients with first-line metastatic triple-negative breast cancer (mTNBC) who are not candidates for checkpoint inhibitors. The potential launch of anito-cel in multiple myeloma and Trodelvy in first-line mTNBC in 2026 will strengthen the company's oncology business. GILD's Valuation and Estimate Revision From a valuation standpoint, GILD is expensive. According to the price/earnings ratio, GILD's shares currently trade at 13.70x forward earnings, lower than the large-cap pharma industry's average of 14.62X but higher than its mean of 10.53X. Earnings estimates for GILD have moved north in the past 60 days. The bottom-line estimate for 2025 has increased to $7.91 from $7.87, while that for 2026 has improved to $8.39 from $8.31. Stay Invested in GILD Large biotech companies are generally considered safe havens for investors interested in this sector as they are well equipped to weather the uncertain macroenvironment. GILD is one of the dominant players in the HIV market. Gilead's efforts to constantly innovate its HIV portfolio should enable it to maintain growth amid competition from GSK plc GSK. GILD has also collaborated with Merck MRK to evaluate the investigational combination of islatravir and lenacapavir for the treatment of HIV. The potential launch of lenacapavir for PrEP in 2025 will be a significant boost for the company. Gilead's strategic deals and acquisitions to diversify its business are encouraging. However, Biktarvy sales are expected to be under pressure due to Medicare Part D redesign, which, in turn, should impact overall HIV growth. Hence, we advise prospective investors to wait and watch how well Biktarvy and the oncology business combat the existing headwinds before making a positive investment decision. In addition, we believe investors should also wait for better entry levels. For investors already owning the stock, it's important to note that Gilead has been consistently increasing and paying out dividends. The company declared a quarterly dividend of $0.79 per share of common stock for the second quarter of 2025. Its strong cash position (as of March 31, 2025, GILD had $7.9 billion of cash, cash equivalents and marketable debt securities) indicates that the current yield of 2.91% is sustainable. Gilead presently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GSK PLC Sponsored ADR (GSK): Free Stock Analysis Report Merck & Co., Inc. 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