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Changes in Gilead’s Revenue Trends in 3Q17

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Gilead’s revenue

Gilead Sciences (GILD) reported revenue of $6.5 billion in 3Q17, a 13% fall from the revenue of $7.5 billion seen in 3Q16. The 3Q17 figure includes product revenue of $6.4 billion, and royalty, contract, and other revenue of $110 million. Analysts expect revenue to fall ~21.9% to $5.7 billion in 4Q17.

Geographical sales

The above graph shows Gilead’s revenue over the last few quarters. Between 3Q16 and 3Q17, US product sales fell to $4.5 billion from $5.1 billion, European product sales fell to $1.2 billion from $1.4 billion, and international product sales fell to $663 million from $931 million.

Antiviral portfolio

Gilead’s antiviral products portfolio, its largest revenue contributor, includes various hepatitis B virus products, hepatitis C virus products, and HIV products. Between 3Q16 and 3Q17, antiviral revenue fell to $5.8 billion from $6.8 billion, driven by lower sales of Harvoni, Truvada, Atripla, Viread, Complera, Stribild, and Sovaldi, and partially offset by strong sales of Vosevi, Odefsey, Descovy, Genvoya, and Epclusa.

Between 3Q16 and 3Q17, Hepatitis C revenue fell 34% to $2.2 billion from $3.3 billion, driven by lower sales of Harvoni and Sovaldi and substantially offset by strong sales of Epclusa and Vosevi. HIV and hepatitis B revenue rose 3% to $3.6 billion from $3.5 billion during 3Q16, due to strong sales of TAF (tenofovir alafenamide) products Genvoya, Odefsey, and Descovy, and substantially offset by lower sales of Atripla, Truvada, Stribild, and Complera.

Other products

Gilead Sciences’ other products, AmBisome, Letairis, Zydelig, and Ranexa, reported revenue of $559 million in 3Q17, a 1% fall from the revenue of $564 million seen in 3Q16. The fall was driven by lower sales of Letairis and Ranexa and offset by growth in AmBisome and Zydelig. The VanEck Vectors Biotech ETF (BBH) has a 9.1% exposure to Gilead Sciences (GILD), a 5.9% exposure to Biogen (BIIB), a 5.2% exposure to Allergan (AGN), and a 4.8% exposure to BioMarin Pharmaceutical (BMRN).

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