Gilead Sciences ((GILD)) has held its Q4 earnings call. Read on for the main highlights of the call.
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The recent earnings call for Gilead Sciences portrayed a robust performance in key therapeutic areas such as HIV and oncology. The company celebrated successful product launches and pipeline advancements, which painted an optimistic picture for future growth. Nevertheless, challenges loom from Medicare Part D reform, a drop in Veklury sales, and intensified competition in the cell therapy market.
Strong Revenue Growth
In a testament to Gilead’s solid market presence, the company reported an 8% increase in total product sales, excluding Veklury, amounting to $26.8 billion year-over-year. The fourth quarter alone saw a surge of 13% in sales, reaching $7.2 billion. Notably, HIV sales surpassed expectations with an 8% growth in 2024, totaling $19.6 billion.
HIV Market Leadership
Gilead continues to dominate the HIV market with Biktarvy sales growing by 13%, capturing over 50% of the U.S. market share. Meanwhile, Descovy maintained a stronghold in the PrEP market with over 40% U.S. market share, demonstrating resilience against competitive pressures.
Successful Launch of Livdelzi
The strategic launch of Livdelzi in the United States for primary biliary cholangitis defied expectations, achieving approximately $30 million in sales during the fourth quarter. This success underscores the potential of Gilead’s liver disease portfolio.
Oncology Growth
Gilead’s oncology segment also showed remarkable growth, with Trodelvy sales increasing 19% year-over-year in the fourth quarter and 24% over the full year, reaching $1.3 billion. Furthermore, Kite’s cell therapy sales touched $2 billion, treating over 7,000 patients in 2024.
Pipeline Advancements
The company made significant strides in its pipeline, filing for lenacapavir approval for HIV prevention and earning a breakthrough therapy designation. Progress in oncology trials and new cell therapy initiatives also highlighted Gilead’s innovative edge.
Challenges with Medicare Part D Reform
The reform of Medicare Part D poses a considerable challenge, with an expected impact of approximately $1.1 billion on 2025 revenue, including a $900 million hit to HIV revenue.
Veklury Sales Decline
Veklury sales took a significant hit, declining 53% year-over-year in the fourth quarter due to reduced COVID-19 hospitalizations. The full year saw an 18% decrease, with sales totaling $1.8 billion.
Competitive Pressures in Cell Therapies
Gilead’s cell therapy sales faced headwinds from new competitive entries and slower uptake in the U.S. and Europe, which may impact future growth.
Litigation Accrual Impacting SG&A
The fourth quarter saw an increase in SG&A expenses due to a litigation accrual for a potential settlement with the U.S. Attorney’s Office, affecting the company’s financial outlook.
Guidance for 2025
Looking ahead, Gilead projects total product sales for 2025 to range from $28.2 billion to $28.6 billion, with sales excluding Veklury between $26.8 billion and $27.2 billion. Despite a stagnant outlook for HIV revenue due to Medicare Part D reform, the company anticipates continued demand-led volume growth. The potential U.S. launch of lenacapavir in mid-2025 and ongoing global regulatory advancements are expected to sustain momentum. Gilead’s oncology and liver disease portfolios are poised to further bolster the company’s growth, with a stable expense outlook and plans to reduce SG&A expenses.
In conclusion, Gilead Sciences’ earnings call reflects a positive sentiment, fueled by strong performances in key markets and promising pipeline developments. While challenges from regulatory changes and competitive pressures exist, the company’s strategic initiatives and robust guidance indicate a resilient and growth-oriented future.
