Gilead Sciences’s earnings missed analysts’ estimates, tumbling 17 percent in the first quarter. Lower sales of the biotech company’s blockbuster hepatitis C virus (HCV) drugs, Harvoni and Sovaldi, contributed to lower-than-expected profit.
Combined sales of Harvoni and Sovaldi were $4.3 billion in the first quarter of this year, falling short of analysts’ estimates by nearly $300 million and dropping $600 million below the previous quarter, Gilead reported on Thursday.
The drug maker attributed this decline to discounts given to private insurers and higher rebates for patients in health plans, like Medicaid. The HCV drugs are priced at $84,000, for Sovaldi, and $94,500, for Harvoni, for a full-course treatment.
Gilead shares dropped more than 6 percent as the biotech company posted earnings of $3.03 a share, and near $8 billion in revenue. Analysts had predicted Gilead to report earnings of about $3.15 a share on $8.12 billion in revenue, according to a consensus estimate from Thomson Reuters.
During the first quarter, Gilead’s HCV drugs Harvoni and Sovaldi had $3.02 billion and $1.28 billion in sales, respectively. Analysts expected $3.13 billion and $1.37 billion in sales, according to estimates.
Gilead said it expects U.S. sales of its HCV drugs to remain flat this year. AbbVie and Merck currently offer similar treatments, bolstering competition.
Gilead’s stock fell 5.7 percent to $91.50 in after-hours trading Thursday.
Details of the company’s revenue:
- Gilead’s sales from last quarter, including its HCV drugs, were $7.7 billion
- Gilead raised its dividend 9.3 percent to 47 cents a share
- Product sales slumped in the U.S. by $800 million versus last year, following the approval of Merck’s Zepatier in January. Last year, U.S. product sales were $5.2 billion; this time, they were $4.4 billion.
- Sales surged in Japan, reaching $1.1 billion
Filed Under: Drug Discovery