Release Date: February 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Gilead Sciences Inc (GILD, Financial) reported strong revenue growth, with total product sales excluding Veklury increasing by 8% year-over-year to $26.8 billion.
• The HIV segment showed significant growth, with full-year sales increasing by 8% to $19.6 billion, driven by the success of Biktarvy, which grew 13%.
• The company is making progress in its oncology segment, with Trodelvy sales increasing by 24% year-over-year, highlighting its role in metastatic breast cancer treatment.
• Gilead Sciences Inc (GILD) is advancing its pipeline with promising developments in HIV prevention, including the potential launch of lenacapavir, which has received Breakthrough Therapy designation.
• The liver disease portfolio, including the launch of Livdelzi, contributed to a 9% increase in sales, reflecting strong demand and market acceptance.

Negative Points

• The anticipated impact of Medicare Part D reform is expected to affect 2025 revenue by approximately $1.1 billion, with $900 million impacting the HIV segment.
• Veklury sales declined by 53% year-over-year in the fourth quarter, reflecting lower COVID-19 hospitalizations and contributing to overall revenue headwinds.
• Competitive dynamics in the cell therapy market pose challenges, with new launches affecting sales growth in the US and Europe.
• The company faces potential litigation costs related to promotional speaker programs for HIV medicines, impacting SG&A expenses.
• Foreign exchange headwinds are expected to offset approximately 1% of expected growth in 2025, adding to the financial challenges.

Q & A Highlights

Q: In HIV, do you view lenacapavir treatment options as eventually replacing Biktarvy? A: Johanna Mercier, Chief Commercial Officer, explained that while Biktarvy is the current standard of care, Gilead is exploring long-acting options like lenacapavir. These could erode some of Biktarvy's market share before its loss of exclusivity in 2033, offering patients more options while maintaining the standard of care.

Q: What is included in the 2025 revenue guidance for lenacapavir for PrEP, and should we expect margin expansion to continue? A: Andrew Dickinson, Chief Financial Officer, stated that the guidance assumes a mid-year launch for lenacapavir, with access building over time. He confirmed strong expense control in 2024 and plans to maintain this discipline, allowing leverage to drop to the bottom line in 2025 and beyond.

Q: As lenacapavir for PrEP approaches launch, how do you view consensus expectations and the ramp-up dynamics? A: Johanna Mercier noted that while specific guidance isn't provided, access will ramp up over the months following launch, with expectations of 75% access by six months and 90% by twelve months. The injectable nature of lenacapavir may initially slow administration, but significant impact is expected in 2025 and beyond.

Q: Can you provide details on the anito-cel data, specifically regarding ICANS cases? A: Cindy Perettie, Executive Vice President of Kite, mentioned that while specific details on ICANS cases weren't provided, there were no cases of tremors observed. Further details can be followed up on.

Q: How is the enrollment in the IDEAL study for Livdelzi going, and what could this mean for the eligible patient population? A: Dietmar Berger, Chief Medical Officer, confirmed that the IDEAL study is on track, assessing a separate second-line population. This could extend Livdelzi's reach to additional patients, potentially expanding its market significantly.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.