Core Viewpoint - Gilead Sciences, Inc. reported lower-than-expected first-quarter 2025 results, with adjusted earnings per share (EPS) of $1.81 and total revenues of $6.7 billion, both missing consensus estimates [1][2] Group 1: Financial Performance - Adjusted EPS of $1.81 missed the Zacks Consensus Estimate by a penny, while the previous year reported a loss per share of $1.32 [1] - Total revenues of $6.7 billion were flat year over year and missed the Zacks Consensus Estimate of $6.8 billion [1] - Key drugs Biktarvy and Trodelvy missed sales expectations, leading to a decline in stock price post-announcement [2] Group 2: HIV Portfolio Strength - Gilead's HIV product sales contributed $4.6 billion in the first quarter, with Biktarvy sales increasing 7% year over year to $3.15 billion despite missing estimates [4] - Biktarvy holds over 51% market share in the U.S. treatment market, indicating strong momentum [5] - The pipeline candidate lenacapavir showed 100% efficacy for HIV prevention in women, with FDA priority review expected by June 19, 2025 [6][7] Group 3: Liver Disease Portfolio - FDA approval of seladelpar for primary biliary cholangitis (PBC) strengthens Gilead's liver disease portfolio, with initial uptake being encouraging [8] Group 4: Oncology Business Challenges - Gilead's oncology portfolio faces competitive pressures, particularly in the Cell Therapy franchise and breast cancer drug Trodelvy, which saw lower-than-expected sales [10] - Potential launches of anito-cel and Trodelvy in 2026 may bolster the oncology business [11] Group 5: Stock Performance and Valuation - Gilead's shares have gained 13.6% year to date, outperforming the industry and S&P 500 [12] - The stock trades at a price/earnings ratio of 12.80x forward earnings, lower than the large-cap pharma industry's average of 15.77x [15] - The bottom-line estimate for 2025 has slightly decreased to $7.91, while the estimate for 2026 has increased to $8.69 [16] Group 6: Strategic Outlook - Gilead's continuous innovation in the HIV portfolio and strategic acquisitions are seen as positive for long-term growth [19][20] - The company maintains a strong cash position of $7.9 billion as of March 31, 2025, supporting a sustainable dividend yield of 2.97% [21]

Core Viewpoint - Gilead Sciences, Inc. reported disappointing first-quarter 2025 results, with adjusted earnings per share (EPS) of $1.81 and total revenues of $6.7 billion, both missing consensus estimates [1][2][3] Financial Performance - Adjusted EPS of $1.81 missed the Zacks Consensus Estimate by a penny, compared to a loss per share of $1.32 in the same quarter last year [1] - Total revenues of $6.7 billion were flat year over year and missed the Zacks Consensus Estimate of $6.8 billion [1] - Total product sales decreased 1% year over year to $6.6 billion, while excluding Veklury, product sales increased 4% to $6.3 billion [3] Product Sales Breakdown - HIV product sales grew 6% year over year to $4.6 billion, exceeding both the Zacks Consensus Estimate and model estimate of $4.5 billion [3] - Biktarvy sales increased 7% year over year to $3.15 billion but missed the Zacks Consensus Estimate of $3.2 billion [4] - Descovy sales surged 38% year over year to $586 million, beating the Zacks Consensus Estimate of $479 million [5] - Liver Disease portfolio sales rose 3% to $758 million, driven by higher demand for HBV and HDV drugs [6] - Veklury sales plummeted 45% to $302 million, missing the Zacks Consensus Estimate of $387 million [7] - Cell Therapy product sales decreased 3% to $464 million, missing the Zacks Consensus Estimate of $491 million [7] Cost and Margin Analysis - Adjusted product gross margin slightly increased to 85.5% from 85.4% in the year-ago quarter [11] - Research and development expenses totaled $1.3 billion, down from $1.4 billion in the previous year [11] - SG&A expenses amounted to $1.2 billion, down from $1.3 billion [11] Dividend and Guidance - Gilead declared a quarterly dividend of $0.79 per share for Q2 2025, payable on June 27, 2025 [12] - The company reiterated its 2025 guidance, projecting product sales between $28.2 billion and $28.6 billion, with adjusted EPS anticipated in the range of $7.70-$8.10 [13] Pipeline Updates - The FDA accepted new drug application submissions for lenacapavir for HIV prevention, with a target action date of June 19, 2025 [14] - Gilead received conditional marketing authorization for seladelpar for the treatment of primary biliary cholangitis [14] Overall Performance Assessment - Gilead's first-quarter results were disappointing, particularly due to a decline in oncology drugs affecting revenue growth [15] - Despite challenges, Biktarvy maintained its dominant position in the HIV market, and Descovy showed strong performance [15] - The potential approval of lenacapavir could further strengthen Gilead's HIV franchise amid increasing competition [16]

Financial Data and Key Metrics Changes - The base business, excluding Veclury, grew 4% year over year, primarily driven by growth in the HIV business [6][50] - Total product sales, including Veclury, were down by 1% from last year, reflecting fewer COVID-19 related hospitalizations [8][50] - Non-GAAP diluted EPS was $1.81, with a product gross margin flat year over year at 85% [52][54] Business Line Data and Key Metrics Changes - HIV sales were up 6% year over year, with Biktarvy sales increasing by 7% [7][22] - Livedelzi achieved first-quarter sales of $40 million, reflecting early momentum in its launch [27] - Veclury sales were down 45% year over year, reflecting lower rates of COVID-19 related hospitalizations [28] - Trodelvy sales were down 5% year over year, impacted by inventory dynamics and lower average realized price [29][98] - Cell therapy sales were down 3% year over year, with Yescarta sales up 2% year over year [31] Market Data and Key Metrics Changes - The HIV treatment market continues to grow at an expected rate of 23% annually [22] - Descovy sales increased by 38% year over year, driven by higher average realized price and demand [23][78] - The liver disease segment saw sales of $758 million, up 3% year over year [26] Company Strategy and Development Direction - The company is focused on multiple upcoming launches, including lenacapavir, anetocel, and Trodelvy [13][34] - Gilead Sciences, Inc. has no major loss of exclusivity (LOE) until the end of 2033, positioning itself for top-line growth across therapeutic areas [14] - The company is increasing investment in US manufacturing and R&D infrastructure [15][89] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming FDA decision on lenacapavir for PrEP, with a potential launch immediately following [9][38] - The company remains well-positioned to adapt to potential policy outcomes in the US [14] - Management noted that the first quarter was lighter than expected but emphasized the variability of the business [54][93] Other Important Information - Gilead Sciences, Inc. received an upgrade in its long-term debt rating from BBB+ to A- [58] - The company returned $1.7 billion to shareholders in the first quarter of 2025 through dividends and share repurchases [58] Q&A Session Summary Question: Expectations for lenacapavir for PrEP and reimbursement dynamics - Management is excited about the upcoming PDUFA date and expects around 75% access within the first six months post-launch, reaching about 90% at the twelve-month mark [62] Question: Impact of HHS and CDC cuts on launch dynamics - Management has not seen anything that would alter plans for the lenacapavir launch and is actively engaging with policymakers [68] Question: Implications of COVID-19 on Descovy and lenacapavir - Descovy saw a 38% growth year over year, driven by market development initiatives, which supports the opportunity for lenacapavir [78] Question: Tariff risks and US market supply - Management indicated that the majority of Gilead's IP is in the US, which suggests lower value for pharmaceutical imports, and they have invested significantly in US manufacturing [86][89] Question: Cannibalization of Descovy by lenacapavir - Management believes lenacapavir will attract both switch patients from daily orals and naive patients, potentially accelerating market growth [124]

Financial Performance - Total product sales, excluding Veklury, increased by 4% year-over-year (YoY) to $6.3 billion[9, 13] - Total HIV product sales increased by 6% YoY, driven by pricing and demand, reaching $4.6 billion[9, 13] - Biktarvy sales increased by 7% YoY, reaching $3.1 billion[9, 17] - Descovy sales increased significantly by 38% YoY, reaching $586 million[9, 17] - Liver disease product sales increased by 3% YoY, reaching $758 million, driven by increased demand across PBC, HBV, and HDV products[13, 20] - Veklury sales decreased by 45% YoY to $302 million, reflecting lower COVID-19 related hospitalizations[13, 23] - Cell Therapy product sales decreased by 4% YoY to $464 million[13] Product & Pipeline Updates - Trodelvy sales decreased by 5% YoY to $293 million due to inventory dynamics and pricing[9, 13] - Livdelzi sales reached $40 million in Q125, showing continued launch momentum in PBC[9, 19] - Positive topline Phase 3 ASCENT-04 data evaluating Trodelvy + pembrolizumab in 1L PD-L1+ mTNBC[9] - Livdelzi received EU approval in February 2025 for PBC, including related pruritus[9, 38]

Core Viewpoint - Gilead Sciences, Inc. (GILD) and Bristol Myers Squibb (BMY) are prominent biotechnology companies with diverse portfolios and global reach, each presenting unique investment opportunities and challenges [1][2][3]. Gilead Sciences (GILD) - Gilead is a leader in the HIV treatment market, with its flagship drug Biktarvy being the most prescribed regimen for HIV-1 infection, maintaining a growing market share [4]. - The company’s prevention drug, Descovy, holds over 40% market share in the U.S. for pre-exposure prophylaxis (PrEP) [4]. - Late-stage studies for lenacapavir, a potential twice-yearly HIV prevention treatment, could significantly enhance Gilead's HIV portfolio [5]. - Gilead's oncology segment includes the successful breast cancer drug Trodelvy, which is undergoing further label expansion studies [6]. - The liver disease portfolio has been bolstered by the FDA approval of seladelpar for primary biliary cholangitis, enhancing Gilead's offerings in this area [7]. - As of December 31, 2024, Gilead's total debt-to-total-capital ratio was 59%, with $10 billion in cash and long-term debt of $25 billion [8]. Bristol Myers Squibb (BMY) - BMY's Growth Portfolio, including drugs like Reblozyl and Opdualag, has stabilized revenue amidst generic competition, with Reblozyl showing strong performance [9][10]. - Opdivo continues to gain momentum with consistent label expansions, and the recent FDA approval for subcutaneous use is expected to enhance its immuno-oncology franchise [11]. - BMY has made strategic acquisitions to expand its portfolio, including the recent approval of Cobenfy for schizophrenia, validating its acquisition strategy [12]. - Despite the growth from newer drugs, BMY faces challenges from generic competition affecting legacy drugs, which significantly impact revenue [13]. - As of December 31, 2024, BMY's total debt-to-total-capital ratio was 75.2%, with cash and equivalents of $10.3 billion and long-term debt of $47.6 billion [14]. Financial Estimates and Performance - The Zacks Consensus Estimate for GILD's 2025 sales indicates a slight decrease of 0.39%, while EPS is expected to increase by 70.13% [15]. - In contrast, BMY's 2025 sales are projected to decrease by 5.11%, but EPS is anticipated to rise by 489.57% [18]. - GILD has outperformed BMY in price performance, with a gain of 15.2% compared to BMY's loss of 9.6% year-to-date [22]. - Valuation metrics show GILD trading at a forward P/E ratio of 13.23, higher than BMY's 7.61 [22]. - BMY offers a higher dividend yield of 4.83% compared to GILD's 2.97% [24]. Investment Outlook - Gilead's innovation in its HIV portfolio and potential approval of lenacapavir for HIV prevention are seen as strong growth catalysts [25]. - BMY's efforts to counteract generic competition are noted, but the outlook for 2025 appears challenging [26]. - Overall, GILD is considered a more favorable investment option at present due to its solid fundamentals and growth potential despite its higher valuation [26].