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How Gilead Sciences Is Positioned after 1H17

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Gilead Sciences revenue trends

In 1H17, Gilead Sciences (GILD) reported revenues of ~$13.4 billion, compared with to $15.6 billion in 1H16. In 1H17, Gilead Sciences saw ~$13.4 billion in product sales and $223 million from royalty, contract, and other revenues.

In 2Q17, Gilead Sciences saw revenues of ~$7.0 billion from the product sales and $95 million from royalty, contract, and other revenues. In 1H17, Gilead Sciences reported net income of ~$5.8 billion, compared with $7.1 billion in 1H16. In 2Q17, Gilead Sciences reported an operating margin of ~65%, compared with ~63% in 1Q17 and ~68% in 2Q17.

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1H17 expenses

In 1H17, Gilead Sciences reported costs of goods sold of ~$2.08 billion, compared with $2.06 billion in 1H16. In 1H17, Gilead Sciences generated R&D (research and development) expenses, and SG&A (selling, general, and administrative) expenses of around $1.8 billion and $1.7 billion, respectively. In 1H17, Gilead Sciences reported total costs and expenses of ~$5.6 billion, compared with $6.4 billion in 1H16.

In September 2017, the CFDA (China Food and Drug Administration) approved Sovaldi for the treatment of patients with chronic HCV (hepatitis C virus). The CFDA approval of Sovaldi was based on a phase-3 trial conducted in China that evaluated the safety and efficacy of Sovaldi in combination with ribavirin or pegylated interferon for the treatment of difficult-to-cure individuals with HCV genotype 1, 2, 3, or 6 infections.

The safety profile of the Sovaldi-ribavirin combination therapy was consistent with prior known side effects of pegylated interferon and ribavirin combination therapy.

Gilead Sciences’ peers in anti-viral drugs market include GlaxoSmithKline (GSK), Merck (MRK), Johnson & Johnson (JNJ), AbbVie, and Bristol-Myers Squibb. Notably, the PowerShares QQQ (QQQ) has about ~1.6% of its total portfolio holdings in GILD.

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