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How Are Gilead Sciences’ Revenues Trending in 2019?

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Revenue projections

In its first-quarter earnings investor presentation, Gilead Sciences (GILD) has projected fiscal 2019 product sales of $21.30 billion to $21.80 billion. Wall Street analysts have forecasted the company’s fiscal 2019 revenues to be $22.05 billion, a YoY decline of 0.36%.

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HCV challenges

Although the revenue decline of Gilead Sciences’ HCV (hepatitis C) franchise has stabilized and the franchise accounts for a smaller percentage of the company’s total revenues, it continues to be a major drag on the company’s revenue growth. In the first quarter, the company reported HCV sales of $790 million, a YoY decline of 24%. According to the first-quarter earnings investor presentation, this performance is attributable to competitive pressures, lower patient starts, and reduced pricing of these drugs by U.S. Medicare.

According to the first-quarter earnings investor presentation, the company’s HCV revenues, however, rose on a sequential basis as compared to $738 million in the fourth quarter of 2018, due to the timing of orders from the Department of Corrections originally anticipated in later quarters of fiscal 2019, inventory stocking by wholesalers of the company’s authorized HCV generics, new patient starts in Asia, and an unfavorable accounting adjustment recorded in the fourth quarter of 2018. The company expects the launch of authorized HCV generics through subsidiary Asegua Therapeutics to accelerate in the second half of fiscal 2019.

HIV challenges

Gilead Sciences’ older TDF (Tenofovir disoproxil fumarate)-based HIV (human immunodeficiency virus) drugs, Atripla, Complera/Eviplera, and Stribild, reported a significant YoY revenue decline in the first quarter. Truvada, the only FDA approved HIV PrEP (pre-exposure prophylaxis) regimen, reported revenues of $606 million in the first quarter, a YoY decline of 7.05%. While Truvada is gaining traction in the US market, both in terms of demand and patient compliance rates, the drug is increasingly facing generic erosion in European markets.

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