Third Quarter 2020
Highlights: Year-Over-Year
- Product Sales increased 18% to $6.5
billion -
- Product Sales excluding Veklury increased
2% to $5.6 billion -
- GAAP Diluted EPS of $0.29 -
- Non-GAAP Diluted EPS increased 29%
to $2.11 -
- Acquisition of Immunomedics, Inc.
-
Updated Full Year 2020
Guidance
- Product Sales of $23 billion to
$23.5 billion -
- Non-GAAP Diluted EPS of $6.25
to $6.60 -
Gilead Sciences, Inc. (Nasdaq: GILD) announced today its results
of operations for the third quarter 2020.
“The recent acquisition of Immunomedics has effectively
transformed Gilead’s growth story. Building on the foundation of
our strong core business, which proved its durability once again
this quarter, we have now significant opportunity to drive
additional growth at an accelerated pace,” said Daniel O’Day,
Chairman and Chief Executive Officer, Gilead Sciences. “Trodelvy,
an approved medicine with extensive potential for patients with a
range of tumor types, adds to our growing portfolio of
transformational medicines. By following the strategy we laid out
at the start of this year, we have significantly improved Gilead’s
near and long-term growth potential.”
Financial Results
- Total revenues for the third quarter 2020 were $6.6 billion, up
17%, compared to $5.6 billion, for the same period in 2019.
- Product sales, excluding Veklury® (remdesivir), increased 2%
year-over-year to $5.6 billion for the third quarter 2020 primarily
due to Gilead’s core HIV products driven by higher volume as
channel inventory continues to normalize in the United States as
well as stronger patient demand. The increase was partially offset
by lower sales volume of Truvada® (emtricitabine (“FTC”) and
tenofovir disoproxil fumarate (“TDF”))-based products and lower
sales of hepatitis C virus (“HCV”) products.
- Veklury revenues were $873 million for the third quarter
2020.
- GAAP net income and diluted earnings per share for the third
quarter 2020 were $360 million and $0.29, respectively, compared to
net loss and diluted loss per share of $(1.2) billion and $(0.92),
respectively, for the same period in 2019.
- GAAP results for the third quarter 2020 included acquired
in-process research and development (“IPR&D”) charges totaling
$1.2 billion related to collaborations and other investments Gilead
entered into during the current quarter as well as a $923 million
unrealized loss from changes in the fair value of Gilead’s equity
investments in Galapagos NV (“Galapagos”).
- GAAP results for the third quarter 2019 included $4.0 billion
acquired IPR&D charges primarily related to Gilead’s global
research and development collaboration agreement with
Galapagos.
- Non-GAAP net income and diluted EPS for the third quarter 2020
were $2.7 billion and $2.11, respectively, compared to $2.1 billion
and $1.64, respectively, for the same period in 2019.
- As expected, the third quarter 2020 revenues reflect the
continued impact from the COVID-19 pandemic on HCV and pre-exposure
prophylaxis (“PrEP”). However, Gilead continued to see signs of
recovery in Europe and the United States during the third quarter
2020.
Three Months Ended
Nine Months Ended
September 30,
September 30,
(In millions, except per share
amounts)
2020
2019
Change
2020
2019
Change
Product sales
$
6,493
$
5,516
18
%
$
17,027
$
16,323
4
%
Royalty, contract and other revenues
84
88
(5
)%
241
247
(2
)%
Total revenues
$
6,577
$
5,604
17
%
$
17,268
$
16,570
4
%
Net income (loss) attributable to
Gilead
$
360
$
(1,165
)
NM
$
(1,428
)
$
2,690
NM
Non-GAAP net income attributable to
Gilead(1)
$
2,657
$
2,091
27
%
$
6,196
$
6,428
(4
)%
Diluted earnings (loss) per share
$
0.29
$
(0.92
)
NM
$
(1.14
)
$
2.10
NM
Non-GAAP diluted earnings per share(1)
$
2.11
$
1.64
29
%
$
4.90
$
5.03
(3
)%
________________________________
NM - Not Meaningful
(1) Beginning in 2020, Gilead no longer regularly excludes
share-based compensation expense from its non-GAAP financial
information. To conform to this change, the prior period non-GAAP
financial information has been recast to include share-based
compensation expense. A reconciliation between GAAP and non-GAAP
financial information is provided in the tables on pages 14 -
16.
The following tables summarize significant items that impacted
the comparability of GAAP net income (loss) attributable to Gilead
and diluted EPS impact for the periods presented:
Three Months Ended September
30,
2020
2019
(In millions, except per share amounts,
net of tax)(1)
Net income Impact
unfavorable/(favorable)
Diluted EPS Impact
unfavorable/(favorable)
Net income Impact
unfavorable/(favorable)
Diluted EPS Impact
unfavorable/(favorable)
Acquired IPR&D expenses
$
1,033
$
0.82
$
3,068
$
2.41
Losses (gains) from equity securities,
net
983
0.78
(66
)
(0.05
)
Total impact to GAAP earnings
$
2,016
$
1.60
$
3,002
$
2.36
Nine Months Ended September
30,
2020
2019
(In millions, except per share amounts,
net of tax)(1)
Net income Impact
unfavorable/(favorable)
Diluted EPS Impact
unfavorable/(favorable)
Net income Impact
unfavorable/(favorable)
Diluted EPS Impact
unfavorable/(favorable)
Acquired IPR&D expenses
$
5,622
$
4.45
$
3,294
$
2.58
Losses (gains) from equity securities,
net
1,090
0.86
(320
)
(0.25
)
Total impact to GAAP earnings
$
6,712
$
5.31
$
2,974
$
2.33
________________________________
(1) All items presented were excluded from non-GAAP net income
and non-GAAP diluted earnings per share. A reconciliation between
GAAP and non-GAAP financial information is provided in the tables
on pages 14 - 16.
Product Sales
Three Months Ended
Nine Months Ended
September 30,
September 30,
(In millions)
2020
2019
Change
2020
2019
Change
HIV Products
$
4,547
$
4,202
8
%
$
12,681
$
11,861
7
%
HCV Products
464
674
(31
)%
1,641
2,306
(29
)%
Cell Therapy Products
147
118
25
%
444
334
33
%
Veklury
873
—
NM
873
—
NM
Other Products
462
522
(11
)%
1,388
1,822
(24
)%
Total Product Sales
$
6,493
$
5,516
18
%
$
17,027
$
16,323
4
%
________________________________
NM - Not Meaningful
Total product sales increased 18% to $6.5 billion for the
third quarter 2020, compared to $5.5 billion for the same period in
2019, primarily due to sales of Veklury and Gilead’s core HIV
products driven by higher volume and stronger patient demand.
For the third quarter 2020, product sales in the United States,
Europe and other international locations were $5.1 billion, $877
million and $540 million, respectively. For the third quarter 2019,
product sales in the United States, Europe and other international
locations were $4.2 billion, $804 million and $513 million,
respectively.
- The growth of Gilead’s product sales excluding Veklury was
primarily due to the following:
- Gilead’s core HIV business driven by higher volume as channel
inventory continues to normalize in the United States as well as
stronger patient demand; and
- Continued patient uptake of Biktarvy® (bictegravir 50
mg/emtricitabine 200 mg/tenofovir alafenamide 25 mg).
- The increase was partially offset by:
- Lower sales volume of Truvada (FTC/TDF)-based products;
and
- Lower HCV sales volume due to the COVID-19 pandemic and lower
average HCV net selling price.
HIV product sales increased 8% to $4.5 billion for the
third quarter 2020, compared to $4.2 billion for the same period in
2019, primarily due to the underlying strength of the HIV
franchise. Biktarvy share continues to grow in the United
States.
- The increase was primarily driven by:
- Gilead’s core HIV business driven by higher volume as channel
inventory continues to normalize in the United States following the
second quarter consumption of the stockpiling from the first
quarter 2020 as well as stronger patient demand; and
- Continued patient uptake of Biktarvy and growth of Descovy®
(emtricitabine 200 mg/tenofovir alafenamide 25 mg) for PrEP®
(“Descovy for PrEP”).
- The increase was partially offset by:
- Lower sales volume of Truvada (FTC/TDF)-based products. Gilead
expects a significant decline in Truvada sales as the first generic
version of Truvada became available in the United States on October
2, 2020;
- Lower average net selling price, including the effect of
unfavorable payer mix; and
- Lower PrEP sales volume due to the COVID-19 pandemic.
HCV product sales decreased 31% to $464 million for the
third quarter 2020, compared to $674 million for the same period in
2019. The HCV business continues to recover from the delayed
patient starts due to the COVID-19 pandemic.
- The decrease was primarily due to:
- Lower sales volume driven by lower patient starts in the United
States and Europe attributable to a decrease in healthcare provider
visits and lower screenings due to the COVID-19 pandemic; and
- Lower average net selling price.
- Sequentially, HCV sales volume increased in Europe due to
higher patient starts.
Cell Therapy product sales, which include Yescarta®
(axicabtagene ciloleucel) and TecartusTM (brexucabtagene
autoleucel), increased 25% to $147 million for the third quarter
2020, compared to $118 million for the same period in 2019. The
increase was primarily driven by the continued uptake and expansion
of Yescarta in Europe. Tecartus was approved by the United States
Food and Drug Administration (“FDA”) during the third quarter
2020.
Veklury generated $873 million in sales primarily in the
United States during the third quarter 2020. Veklury revenue is
generated in a highly dynamic and complex global health
environment, which continues to evolve. As a result, Veklury
revenue is subject to significant volatility and uncertainly.
Other product sales, which include Vemlidy® (tenofovir
alafenamide 25 mg), Viread® (tenofovir disoproxil fumarate 300mg),
Letairis® (ambrisentan 5 mg and 10 mg), Ranexa® (ranolazine 500 mg
and 1000 mg), Zydelig® (idelalisib 150 mg), AmBisome® (amphotericin
b liposome for injection 50 mg/vial) and Cayston® (aztreonam for
inhalation solution 75 mg/vial), decreased 11% to $462 million for
the third quarter 2020, compared to $522 million for the same
period in 2019, primarily due to the expected declines in sales of
Letairis and Ranexa after generic entries in the first half of
2019.
Operating Expenses
Three Months Ended
Nine Months Ended
September 30,
September 30,
(In millions)
2020
2019
Change
2020
2019
Change
Research and development (“R&D”)
expenses(1)
$
1,158
$
1,030
12%
$
3,461
$
2,956
17%
Non-GAAP R&D expenses(1)
$
1,155
$
1,028
12%
$
3,345
$
2,956
13%
Acquired IPR&D expenses(1)
$
1,171
$
3,960
(70)%
$
5,792
$
4,251
36%
Non-GAAP Acquired IPR&D
expenses(1)
$
—
$
—
—%
$
—
$
—
—%
Selling, general and administrative
(“SG&A”) expenses
$
1,106
$
1,052
5%
$
3,421
$
3,177
8%
Non-GAAP SG&A expenses
$
1,095
$
1,045
5%
$
3,335
$
3,171
5%
________________________________
(1) Beginning in the second quarter 2020, Acquired IPR&D
expenses were reported separately from R&D expenses in Gilead’s
Condensed Consolidated Statements of Operations to provide
additional information. Acquired IPR&D expenses reflect
IPR&D impairments as well as the initial costs of externally
developed IPR&D projects, acquired directly in a transaction
other than a business combination, that do not have an alternative
future use, including upfront payments related to various
collaborations and the initial costs of rights to IPR&D
projects. The amounts for prior periods have been reclassified to
conform to the current period presentation. Acquired IPR&D
expenses have been historically excluded from Gilead’s non-GAAP
financial information.
During the third quarter 2020, compared to the same period in
2019:
- R&D expenses and non-GAAP R&D expenses increased
primarily due to higher clinical trial expenses related to
remdesivir and higher investments in oncology programs including
magrolimab, partially offset by lower costs as a result of Gilead’s
pause or postponement of certain clinical trials due to the
COVID-19 pandemic.
- Acquired IPR&D expenses of $4.0 billion for the third
quarter 2019 were primarily related to Gilead’s global research and
development collaboration agreement with Galapagos. Acquired
IPR&D expenses of $1.2 billion for the third quarter 2020 were
related to collaborations and other investments Gilead entered into
during the current quarter, separately with Arcus Biosciences, Inc.
(“Arcus”), Pionyr Immunotherapeutics, Inc. (“Pionyr”), Tango
Therapeutics (“Tango”) and Tizona Therapeutics, Inc.
(“Tizona”).
- SG&A expenses and non-GAAP SG&A expenses for the third
quarter 2020 increased primarily due to higher expenses driven by
headcount growth, partially offset by lower marketing and other
spend due to the COVID-19 pandemic.
Other Income (Expense),
Net
Three Months Ended
Nine Months Ended
September 30,
September 30,
(In millions)
2020
2019
Change
2020
2019
Change
Other income (expense), net
$
(940
)
$
222
NM
$
(848
)
$
817
NM
Non-GAAP other income (expense), net
$
29
$
164
(82
)%
$
203
$
505
(60
)%
________________________________
NM - Not Meaningful
During the third quarter 2020, compared to the same period in
2019:
- Other income (expense), net decreased primarily due to
unfavorable changes in the fair value of Gilead’s equity securities
largely driven by a $923 million unrealized loss relating to
Gilead’s investments in Galapagos and lower interest income.
- Non-GAAP Other income (expense), net decreased by 82% primarily
due to lower interest income.
Effective Tax Rate
The GAAP effective tax rate (“ETR”) and non-GAAP ETR for the
third quarter 2020 were 57.2% and 18.4%, respectively, compared to
22.2% and 22.1% for the same period in 2019, respectively. The
year-over-year increase in GAAP ETR is primarily due to the
above-mentioned unrealized loss on Gilead’s equity investments in
Galapagos, as well as certain third quarter 2020 acquired IPR&D
charges that are non-deductible for income tax purposes. The GAAP
and non-GAAP ETR for the third quarter 2020 reflects a $91 million
net discrete tax benefit related to a settlement with a taxing
authority.
Cash, Cash Equivalents and Marketable
Debt Securities
As of September 30, 2020, Gilead had $26.0 billion of cash, cash
equivalents and marketable debt securities, compared to $25.8
billion as of December 31, 2019. During the third quarter 2020,
Gilead generated $2.3 billion in operating cash flow, issued senior
unsecured notes in an aggregate principal amount of $7.25 billion,
repaid $2.0 billion of debt that matured during the third quarter
2020, utilized $1.0 billion on acquisitions, net of cash acquired
(including IPR&D), paid cash dividends of $861 million and
utilized $201 million on stock repurchases. In an event subsequent
to the third quarter 2020, on October 23, 2020, Gilead completed
the acquisition of Immunomedics, Inc (“Immunomedics”), which was
financed with the majority of the proceeds from the September 2020
senior unsecured notes offering, an additional $1.0 billion from a
new senior unsecured term loan facility and the balance with cash
on hand.
Updated Full Year 2020
Guidance
Gilead’s 2020 guidance has been updated to reflect the continued
global progression of the COVID-19 pandemic, including infection
rates, hospitalization rates and broad commercial availability of
Veklury, resulting in a tightening of the estimated revenue range.
As mentioned elsewhere, Veklury generates revenue within a highly
dynamic and complex global health environment, which continues to
evolve.
(In millions, except percentages and
per share amounts)
Initially Provided
February 4, 2020
Previously Updated July
30, 2020
Updated October 28,
2020
Product Sales
$21,800 - $22,200
$23,000 - $25,000
$23,000 - $23,500
Non-GAAP
Product Gross Margin
86% - 87%
86% - 87%
86% - 87%
R&D Expenses
Mid-single digit percentage
growth
Mid-teens percentage growth
Mid-teens percentage growth
SG&A Expenses
Mid-single-digit percentage
growth
High single-digit percentage
growth
Low double-digit percentage
growth
Operating Income
$10,100 - $10,800
$10,700 - $13,000
$10,700 - $11,200
Effective Tax Rate
~ 21%
~ 21%
~ 20%
Diluted EPS
$6.05 - $6.45
$6.25 - $7.65
$6.25 - $6.60
GAAP Diluted Earnings (Loss) Per Share
$5.15 - $5.55
$0.83 - $2.23
$(0.25) - $0.10
Outlook
The COVID-19 pandemic continues to impact Gilead’s business and
broader market dynamics, including HCV and PrEP market volume.
Gilead expects its core business will continue to gradually recover
in the fourth quarter 2020 and into the first half of 2021. Gilead
expects that the company’s HIV treatment business will continue to
remain largely unaffected and that by the first quarter of 2021,
patients with HCV will begin to initiate treatment. The acquisition
of Immunomedics will immediately contribute to Gilead’s revenue
growth and is expected to be neutral to accretive to Gilead’s
non-GAAP EPS in 2023 and significantly accretive thereafter. The
fundamentals of Gilead’s business and long-term outlook remain
strong.
Business Highlights
During the third quarter 2020, Gilead made important strides in
advancing work across each of the three long-term ambitions laid
out in its corporate strategy: (i) to bring 10+ transformative
therapies to patients by 2030; (ii) to be the biotech employer and
partner of choice; and (iii) to deliver shareholder value in a
sustainable and responsible manner. This progress occurred as
Gilead continued efforts to enhance its understanding of
remdesivir’s role in treating COVID-19 and rapidly expand access
for patients worldwide.
Corporate Development:
Gilead significantly accelerated the buildout of its oncology
portfolio and expertise in the third quarter 2020 by announcing the
acquisition of Immunomedics. This transaction, Gilead’s thirteenth
in oncology in the last two years, brings a foundational product to
Gilead’s oncology franchise, broadening and deepening the company’s
solid tumor pipeline and building on current marketed products and
late-stage clinical candidates for patients with hematologic
malignances.
- In September, Gilead agreed to acquire Immunomedics for
approximately $21 billion. In an event subsequent to the third
quarter 2020, in October, Gilead closed the transaction and gained
Trodelvy® (sacituzumab govitecan-hziy), a first-in-class
Trop-2-directed antibody-drug conjugate. Trodelvy was granted
accelerated approval by FDA in April for the treatment of adult
patients with metastatic triple-negative breast cancer (“mTNBC”)
who have received at least two prior therapies for metastatic
disease. Beyond mTNBC, Trodelvy is being studied as a monotherapy
and combination agent for additional tumor types, including
HR+/HER2- breast cancer, bladder cancer, non-small cell lung cancer
and other solid tumors. At the ESMO Virtual Congress 2020,
Immunomedics presented new data on Trodelvy, including detailed
results from the Phase 3 ASCENT study in mTNBC and additional
clinical data in bladder cancer and other solid tumors.
In the third quarter 2020, Gilead also entered into several
additional agreements to advance its emerging and complementary
oncology portfolio:
- Gilead completed its transaction with Arcus to enter into a
10-year partnership. Gilead and Arcus will co-develop and
co-commercialize next generation cancer immunotherapies, including
investigational products that target important mechanisms involved
in tumor evasion of the immune system and cell-intrinsic pathways
important for cancer growth and metastasis.
- Kite Pharma Inc. (“Kite”), a Gilead Company, entered into a
two-year research collaboration and license agreement with HiFiBiO
Therapeutics (“HiFiBiO”). HiFiBiO will use its proprietary
technology platforms to identify novel acute myeloid leukemia
(“AML”) targets and anti-AML specific antibodies for Kite’s use in
cell therapies, and Kite will have an exclusive option to opt in on
any targets discovered through the collaboration.
- Gilead announced an agreement with Jounce Therapeutics, Inc.
(“Jounce”) to exclusively license JTX-1811, Jounce’s monoclonal
antibody designed to selectively deplete immunosuppressive
tumor-infiltrating T regulatory cells. Jounce will lead development
of JTX-1811 through investigational new drug clearance, and
thereafter, Gilead will have the sole right to develop the
compound. In an event subsequent to the third quarter 2020, in
October, this transaction was completed.
- Gilead acquired a 49.9% equity interest in Pionyr, as well as
an exclusive option to acquire the remainder of Pionyr following
the readout of a Phase 1b study of Pionyr’s investigational
antibodies, PY314 and PY159, or earlier. Pionyr’s Myeloid Tuning™
therapies have the potential to treat patients who currently do not
benefit from checkpoint inhibitor therapies. PY314 and PY159 are
first-in-class antibodies designed to remove or reprogram,
respectively, the immune suppressive cells in the tumor
microenvironment and thereby enhance anti-tumor immunity.
- Gilead acquired a 49.9% equity interest in Tizona, as well as
an exclusive option to acquire the remainder of Tizona following
the readout of a Phase 1b study of Tizona’s investigational
antibody, TTX-080, or earlier. TTX-080 is a potential
first-in-class medicine that targets HLA-G, a novel and emerging
immune checkpoint expressed across multiple tumor types.
- Gilead expanded its multi-year collaboration with Tango. Tango
will continue to leverage its proprietary, CRISPR-enabled
functional genomics target discovery platform to identify novel
immune evasion targets. The number of targets covered will expand
from five to 15.
Remdesivir and Gilead’s Ongoing COVID-19 Pandemic
Response:
Ensuring Broader Access to Veklury:
During the third quarter of 2020, additional regulatory
authorizations for the treatment of COVID-19 facilitated broader
access to Veklury. Additionally, Gilead continued to collaborate
with industry partners and thought leaders to support efforts to
systematically address the impact of COVID-19 on minority
communities and ensure affordable supply of therapy for people
worldwide.
- In October and July, Veklury became the first approved
treatment for COVID-19 in the United States and European Union,
respectively. FDA granted full approval to Veklury for the
treatment of patients with COVID-19, and the European Commission
(“EC”) granted conditional Marketing Authorization for the
treatment of COVID-19.
- As previously discussed in Gilead’s second quarter 2020
earnings press release, Gilead executed process improvements to
shorten the manufacturing time and expanded its manufacturing
capacity globally to supply remdesivir broadly. As a result, Gilead
has been meeting real-time patient demand for Veklury in the United
States since the beginning of October and now meets global patient
demand for Veklury, even in the event of potential future surges of
COVID-19.
- In October, Gilead began distributing Veklury in the United
States upon conclusion of the previous distribution agreement with
the U.S. Federal government. To ensure stable management of drug
supply in the near-term, AmerisourceBergen will continue to serve
as the sole U.S. distributor of Veklury through the end of 2020 and
will sell the product directly to hospitals. This distribution
model closely reflects the traditional model hospitals use to
procure medicines. Hospitals will control the quantity of Veklury
that they order, enabling them to have a predictable supply of
Veklury.
- In October, Gilead and the EC signed a joint procurement
agreement (“JPA”) that will enable rapid and equitable access to
Veklury. The JPA enables participating countries in the European
Union and the European Economic Area and the United Kingdom to
purchase Veklury for both real-time patient demand and stockpiling
needs, coordinated by the EC. The agreement covers purchases of
Veklury for a six-month period and has the option to be
extended.
Advancing Remdesivir Clinical Development:
Gilead continues to make rapid progress advancing remdesivir as
a treatment for COVID-19. During the third quarter 2020, additional
data were released that further enhance the understanding of
remdesivir and point to its important role in treating patients
with COVID-19, and new clinical trials were initiated to assess
remdesivir’s safety and efficacy in additional patient
populations.
- In July, Gilead presented new data at the 23rd International
AIDS Conference, including a comparative analysis of the Phase 3
SIMPLE-Severe trial and a real-world retrospective of a cohort of
patients with severe COVID-19. The analysis demonstrated that
remdesivir was associated with an improvement in clinical recovery
and a 62 percent reduction in the risk of mortality compared with
the standard of care. Separate subgroup analyses from the Phase 3
SIMPLE-severe trial found that traditionally marginalized racial or
ethnic groups treated with remdesivir experienced similar clinical
outcomes as the overall patient population in the study.
- In July, Gilead announced the initiation of a Phase 1a clinical
study to evaluate the safety, tolerability and pharmacokinetics of
an investigational, inhaled solution of remdesivir in healthy
volunteers. Gilead also announced plans for trials using
intravenous infusions in outpatient settings such as infusion
centers and nursing homes, trials evaluating remdesivir in
combination with the JAK inhibitor, baricitinib, and the IL-6
receptor antagonist tocilizumab; and trials including vulnerable
patient populations, such as children, pregnant women, and patients
with end-stage renal disease.
- In October, the New England Journal of Medicine (“NEJM”)
published the final results from the National Institute of Allergy
and Infectious Diseases’ (“NIAID”) Phase 3 ACTT-1 trial in adults
hospitalized with mild-moderate or severe COVID-19. The final
ACTT-1 study results showed that treatment with Veklury resulted in
consistent, clinically meaningful improvements across multiple
outcome assessments compared with placebo in COVID-19 patients. The
final results also demonstrate that treatment with Veklury resulted
in a faster time to recovery than previously reported. Overall,
treatment with Veklury resulted in five days faster recovery and
reduced disease progression compared with placebo. Veklury reduced
mortality by 70 percent at day 29 in patients on low-flow oxygen at
baseline in a post-hoc analysis.
Other Pipeline Updates:
Viral Diseases:
- In July, new data across Gilead’s HIV franchise were presented
at the 23rd International AIDS Conference. The presentations
included a new clinical study data for a sustained-delivery
subcutaneous formulation of Gilead’s novel investigational HIV-1
capsid inhibitor lenacapavir; additional data evaluating the safety
and efficacy of Biktarvy as a treatment for HIV in adults aged 65
or older; data from the DISCOVER trial indicating no increase in
sexual health risk behavior among those taking Descovy for PrEP or
Truvada for PrEP, and an update on Gilead’s cure research strategy
through data on dose-dependent immune responses with vesatolimod,
an investigational toll-like receptor 7 (“TL7R”) agonist.
- In August, the China National Medical Products Administration
approved a PrEP indication for Truvada. Truvada is the first
medicine approved for HIV prevention in China.
- In August, new data showcasing the breadth of Gilead’s research
in viral hepatitis were presented at the Digital International
Liver Congress™ 2020. The presentations included data reinforcing
the effectiveness of Epclusa® for HCV in key underserved
populations, as well as new data demonstrating the durable renal
and bone safety benefit of Vemlidy for hepatitis B virus (“HBV”)
and supporting the further evaluation of selgantolimod as part of a
combination approach to a functional cure for HBV.
- In October, new data for Biktarvy were presented at HIV Glasgow
2020. The presentations included long-term study results from
multiple switch studies, in which treatment with Biktarvy continued
to demonstrate durable efficacy with an established safety profile
in a broad range of people living with HIV, as well as data from
the observational, real-world, global BICSTaR study, which showed
consistent therapeutic effectiveness and long-term safety in
real-world practice settings.
Inflammatory Diseases:
- In August, new data highlighting Gilead’s research in
nonalcoholic steatohepatitis (“NASH”) and primary sclerosing
cholangitis (“PSC”) were presented at the Digital International
Liver Congress™ 2020. The presentations included the full results
from the Phase 2 ATLAS study, which demonstrate the potential for
combination approaches for the treatment of people with advanced
fibrosis due to NASH, as well as new data describing the utility of
machine learning approaches to evaluate liver histology, identify
histologic features associated with disease progression in NASH and
PSC, and assess the impact of treatment with TDF in chronic
HBV.
- In September, Gilead and Eisai Co., Ltd., announced that the
Japanese Ministry of Health, Labour and Welfare granted regulatory
approval of Jyseleca® (filgotinib 200 mg and 100 mg tablets) for
the treatment of rheumatoid arthritis (“RA”) in patients who have
had an inadequate response to conventional therapies, including the
prevention of structural joint damage.
- In September, Gilead and Galapagos announced that EC granted
marketing authorization for Jyseleca for the treatment of adults
with moderate to severe active RA who have responded inadequately
to, or are intolerant to, one or more disease modifying
anti-rheumatic drugs. Under the marketing authorization, Jyseleca
may be used as monotherapy or in combination with methotrexate. The
EC’s decision follows a positive opinion from the European
Medicines Agency’s (“EMA”) Committee for Medicine Products for
Human Use (“CHMP”), which was announced in July.
- In October, Gilead and Galapagos presented new data at the 2020
United European Gastroenterology Week Virtual Meeting, including
late-breaking data from the Phase 2b/3 SELECTION trial evaluating
filgotinib for the treatment of moderately to severely active
ulcerative colitis (“UC”). The data showed that a significantly
higher proportion of patients treated with filgotinib 200 mg,
versus placebo, achieved clinical remission at Week 10 and
maintained remission through Week 58. In addition, significantly
more patients achieved six-month corticosteroid-free
remission.
Oncology:
- In July, FDA granted accelerated approval to Tecartus, the
first and only approved chimeric antigen receptor (“CAR”) T cell
therapy for the treatment of adult patients with relapsed or
refractory mantle cell lymphoma.
- In September, Kite announced the submission of a supplemental
Biologics License Application to FDA for Yescarta for the treatment
of relapsed or refractory follicular lymphoma and marginal zone
lymphoma after two or more prior lines of systemic therapy. If
approved, Yescarta would be the first CAR T cell therapy approved
for the treatment of relapsed or refractory indolent non-Hodgkin
lymphoma.
- In September, Gilead announced that FDA granted Breakthrough
Therapy designation for magrolimab, a first-in-class,
investigational, monoclonal antibody for the treatment of newly
diagnosed myelodysplastic syndrome (“MDS”). The Breakthrough
Therapy designation was based on positive results from the ongoing
Phase 1b study evaluating magrolimab in combination with
azacitidine in previously untreated intermediate, high and very
high-risk MDS.
- In October, Kite announced that the EMA Committee for CHMP has
issued a positive opinion on its Marketing Authorization
Application for KTE-X19, a CAR T cell therapy, for the treatment of
relapsed or refractory mantle cell lymphoma. In recognition of its
potential to benefit patients with significant unmet medical need,
KTE-X19 was granted Priority Medicines designation by the EMA.
Senior Unsecured Notes Offering: In September, Gilead
issued $7.25 billion aggregate principal amount of senior unsecured
notes, in an underwritten, registered public offering, consisting
of seven tranches.
Term Loan Facility: In an event subsequent to the third
quarter of 2020, in October, Gilead entered into a three-year term
loan facility credit agreement with a group of institutional
lenders and borrowed an aggregate principal amount of $1.0
billion.
Board Appointment: In October 2020, Anthony Welters, who
retired in 2016 as Senior Adviser to the Office of the Chief
Executive Officer of UnitedHealth Group Inc., joined Gilead’s Board
of Directors. With his extensive experience in the health insurance
and managed care industry, Mr. Welters will bring important
perspective to the Board as Gilead continues its work to deliver
transformational medicines to patients.
Non-GAAP Financial
Information
The information presented in this document has been prepared in
accordance with U.S. generally accepted accounting principles
(“GAAP”), unless otherwise noted as non-GAAP. Management believes
non-GAAP information is useful for investors, when considered in
conjunction with Gilead’s GAAP financial information, because
management uses such information internally for its operating,
budgeting and financial planning purposes. Non-GAAP information is
not prepared under a comprehensive set of accounting rules and
should only be used to supplement an understanding of Gilead’s
operating results as reported under GAAP. Non-GAAP financial
information excludes acquisition-related expenses including
amortization, acquired IPR&D expenses including the initial
costs of externally developed IPR&D with no alternative future
use, upfront collaboration and licensing expenses and IPR&D
impairments, and other items that are considered unusual or not
representative of underlying trends of Gilead’s business, fair
value adjustments of equity securities and discrete and related tax
charges or benefits associated with changes in tax related laws and
guidelines. Although Gilead consistently excludes the amortization
of acquired intangible assets from the non-GAAP financial
information, management believes that it is important for investors
to understand that such intangible assets were recorded as part of
acquisitions and contribute to ongoing revenue generation. Non-GAAP
measures may be defined and calculated differently by other
companies in the same industry. Reconciliations of the non-GAAP
financial measures to the most directly comparable GAAP financial
measures are provided in the tables on pages 14 through 16.
Conference Call
At 4:30 p.m. Eastern Time today, Gilead’s management will host a
conference call to discuss the company’s third quarter 2020
financial results and will provide a business update. The live
webcast of the call can be accessed at Gilead’s Investors page at
http://investors.gilead.com. Please connect to the website at least
15 minutes prior to the start of the call to ensure adequate time
for any software download that may be required to listen to the
webcast. Alternatively, please call 877-359-9508 (U.S.) or
224-357-2393 (international) and dial the conference ID 6986657 to
access the call. Telephone replay will be available approximately
two hours after the call through 11:59 p.m. Eastern Time, October
30, 2020. To access the replay, please call 855-859-2056 (U.S.) or
404-537-3406 (international) and dial the conference ID 6986657.
The webcast will be archived on www.gilead.com for one year.
About Gilead Sciences
Gilead Sciences, Inc. is a research-based biopharmaceutical
company that discovers, develops and commercializes innovative
medicines in areas of unmet medical need. The company strives to
transform and simplify care for people with life-threatening
illnesses around the world. Gilead has operations in more than 35
countries worldwide, with headquarters in Foster City,
California.
Forward-Looking
Statements
Statements included in this press release that are not
historical in nature are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Gilead cautions readers that forward-looking statements are subject
to certain risks and uncertainties that could cause actual results
to differ materially. These risks and uncertainties include: the
risks and uncertainties related to the impact of the COVID-19
pandemic on Gilead’s business, financial condition and results of
operations; the risks and uncertainties related to the development,
manufacturing and distribution of remdesivir as a treatment for
COVID-19, including the uncertainty of the amount and timing of
future Veklury revenues and the risk that Gilead may be unable to
recoup the expenses incurred to date and future expenses related to
the development and production of remdesivir, Gilead may be unable
to maintain the production of remdesivir at current and anticipated
levels and Gilead may be unable to effectively manage the global
supply and distribution of remdesivir; Gilead’s ability to achieve
its anticipated full year 2020 financial results, including as a
result of potential adverse revenue impacts from COVID-19,
increases in expenses due to the development and commercialization
of remdesivir and potential revenues from Veklury; Gilead’s ability
to make progress on any of its long-term ambitions laid out in its
corporate strategy; Gilead’s ability to accelerate or sustain
revenues for its antiviral and other programs; Gilead’s ability to
realize the potential benefits of acquisitions, collaborations or
licensing arrangements, including those of or with Arcus, HiFiBiO,
Immunomedics, Jounce, Pionyr, Tango and Tizona; the ability to
initiate, progress or complete clinical trials within currently
anticipated timeframes, including the ongoing and additional
clinical trials involving remdesivir for the treatment of COVID-19;
the possibility of unfavorable results from ongoing and additional
clinical trials involving Biktarvy, Epclusa, Descovy for PrEP,
Trodelvy, Truvada for PrEP, Veklury and Vemlidy; the risk that
safety and efficacy data from clinical studies may not warrant
further development of Gilead’s product candidates, including
filgotinib, lenacapavir, KTE-X19, magrolimab, remdesivir,
selgantolimod and vesatolimod, or the product candidates of
Gilead’s strategic partners; Gilead’s ability to submit new drug
applications for new product candidates in the currently
anticipated timelines; Gilead’s ability to receive regulatory
approvals in a timely manner or at all, for new and current
products, including FDA approval of Yescarta for the treatment of
relapsed or refractory follicular lymphoma and marginal zone
lymphoma after two or more prior lines of systemic therapy and EC
approval of KTE-X19 for the treatment of relapsed or refractory
mantle cell lymphoma, which may be subject to signification
limitations on use; Gilead’s ability to successfully commercialize
its products; the risk of potential disruptions to the
manufacturing and supply chain of Gilead’s products; the risk that
private and public payers may be reluctant to provide, or continue
to provide, coverage or reimbursement for new products; the risk
that efforts to control prescription drug prices could have a
material adverse effect on Gilead’s business; a larger than
anticipated shift in payer mix to more highly discounted payer
segments; market share and price erosion caused by the introduction
of generic versions of Gilead products; the risk that physicians
and patients may not see advantages of these products over other
therapies and may therefore be reluctant to prescribe the products;
and other risks identified from time to time in Gilead’s reports
filed with the U.S. Securities and Exchange Commission (the “SEC”).
Additionally, with respect to Gilead’s acquisition of Immunomedics,
risks and uncertainties include: the uncertainties relating to the
post-closing operations and outlook for the business, including,
without limitation, Gilead’s ability to advance the product
pipeline and successfully commercialize Trodelvy; expectations for
achieving full FDA approval based on confirmatory data for Trodelvy
and the development of Trodelvy for additional indications;
difficulties or unanticipated expenses in connection with the
integration of Immunomedics; the effects of the transaction on
relationships with employees, other business partners or
governmental entities; Gilead’s ability to meet post-approval
compliance obligations (on topics including but not limited to
product quality, product distribution and supply chain
requirements, and promotional and marketing compliance); imposition
of significant post-approval regulatory requirements on products,
including a requirement for a post-approval confirmatory clinical
study, or failure to maintain (if received) or obtain full
regulatory approval for products due to a failure to satisfy
post-approval regulatory requirements, such as the submission of
sufficient data from a confirmatory clinical study; and other risks
identified from time to time in the companies’ reports filed with
the SEC. In addition, Gilead makes estimates and judgments that
affect the reported amounts of assets, liabilities, revenues and
expenses and related disclosures. Gilead bases its estimates on
historical experience and on various other market specific and
other relevant assumptions that it believes to be reasonable under
the circumstances, the results of which form the basis for making
judgments about the carrying values of assets and liabilities that
are not readily apparent from other sources. There may be other
factors of which Gilead is not currently aware that may affect
matters discussed in the forward-looking statements and may also
cause actual results to differ significantly from these estimates.
Further, results for the quarter ended September 30, 2020 are not
necessarily indicative of operating results for any future periods.
Information about these and other risks, uncertainties and factors
can be found in Gilead’s periodic reports filed with the SEC,
including annual reports on Form 10-K, quarterly reports on Form
10-Q and current reports on Form 8-K. Gilead claims the protection
of the Safe Harbor contained in the Private Securities Litigation
Reform Act of 1995 for forward-looking statements.
All forward-looking statements are based on information
currently available to Gilead and Gilead assumes no obligation to
update or supplement any such forward-looking statements other than
as required by law. Any forward-looking statements speak only as of
the date hereof or as of the dates indicated in the statements.
Gilead owns or has rights to various
trademarks, copyrights and trade names used in its business,
including the following: GILEAD®, GILEAD SCIENCES®, AMBISOME®,
ATRIPLA®, BIKTARVY®, CAYSTON®, COMPLERA®, DESCOVY®, DESCOVY FOR
PREP®, EMTRIVA®, EPCLUSA®, EVIPLERA®, GENVOYA®, HARVONI®, HEPSERA®,
JYSELECA®, LETAIRIS®, ODEFSEY®, RANEXA®, SOVALDI®, STRIBILD®,
TECARTUSTM, TRODELVY®, TRUVADA®, TRUVADA FOR PREP®, TYBOST®,
VEKLURY®, VEMLIDY®, VIREAD®, VOSEVI®, YESCARTA® and ZYDELIG®.
This report also refers to trademarks, service
marks and trade names of other companies.
For more information on Gilead Sciences, Inc.,
please visit www.gilead.com or call the Gilead Public Affairs
Department at 1-800-GILEAD-5 (1-800-445-3235).
GILEAD SCIENCES, INC.
GAAP CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
(in millions, except per share
amounts)
2020
2019
2020
2019
Revenues:
Product sales
$
6,493
$
5,516
$
17,027
$
16,323
Royalty, contract and other revenues
84
88
241
247
Total revenues
6,577
5,604
17,268
16,570
Costs and expenses:
Cost of goods sold
1,141
1,035
3,174
2,992
Research and development expenses
1,158
1,030
3,461
2,956
Acquired in-process research and
development expenses
1,171
3,960
5,792
4,251
Selling, general and administrative
expenses
1,106
1,052
3,421
3,177
Total costs and expenses
4,576
7,077
15,848
13,376
Income (loss) from operations
2,001
(1,473
)
1,420
3,194
Interest expense
(236
)
(250
)
(717
)
(752
)
Other income (expense), net
(940
)
222
(848
)
817
Income (loss) before income taxes
825
(1,501
)
(145
)
3,259
Income tax expense (benefit)
472
(333
)
1,310
584
Net income (loss)
353
(1,168
)
(1,455
)
2,675
Net loss attributable to noncontrolling
interest
(7
)
(3
)
(27
)
(15
)
Net income (loss) attributable to
Gilead
$
360
$
(1,165
)
$
(1,428
)
$
2,690
Net income (loss) per share attributable
to Gilead common stockholders - basic
$
0.29
$
(0.92
)
$
(1.14
)
$
2.12
Shares used in per share calculation -
basic
1,255
1,267
1,257
1,271
Net income (loss) per share attributable
to Gilead common stockholders - diluted
$
0.29
$
(0.92
)
$
(1.14
)
$
2.10
Shares used in per share calculation -
diluted
1,261
1,267
1,257
1,278
Cash dividends declared per share
$
0.68
$
0.63
$
2.04
$
1.89
GILEAD SCIENCES, INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL INFORMATION(1)
(unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
(in millions, except percentages and
per share amounts)
2020
2019
2020
2019
Cost of goods sold
reconciliation:
GAAP cost of goods sold
$
1,141
$
1,035
$
3,174
$
2,992
Acquisition-related – amortization of
purchased intangibles
(266
)
(266
)
(798
)
(822
)
Non-GAAP cost of goods sold
$
875
$
769
$
2,376
$
2,170
Product gross margin
reconciliation:
GAAP product gross margin
82.4
%
81.2
%
81.4
%
81.7
%
Acquisition-related – amortization of
purchased intangibles
4.1
%
4.8
%
4.7
%
5.0
%
Non-GAAP product gross margin(7)
86.5
%
86.1
%
86.0
%
86.7
%
Research and development expenses
reconciliation:
GAAP research and development
expenses(2)
$
1,158
$
1,030
$
3,461
$
2,956
Acquisition-related – other costs(4)
(3
)
—
(116
)
—
Other(5)
—
(2
)
—
—
Non-GAAP research and development
expenses
$
1,155
$
1,028
$
3,345
$
2,956
Acquired IPR&D expenses
reconciliation(2) :
GAAP acquired IPR&D expenses
$
1,171
$
3,960
$
5,792
$
4,251
Acquired IPR&D expenses
(1,171
)
(3,960
)
(5,792
)
(4,251
)
Non-GAAP acquired IPR&D expenses
$
—
$
—
$
—
$
—
Selling, general and administrative
expenses reconciliation:
GAAP selling, general and administrative
expenses
$
1,106
$
1,052
$
3,421
$
3,177
Acquisition-related – other costs(4)
(12
)
—
(89
)
—
Other(5)
1
(7
)
3
(6
)
Non-GAAP selling, general and
administrative expenses
$
1,095
$
1,045
$
3,335
$
3,171
Operating margin reconciliation
GAAP operating margin
30.4
%
(26.3
)
%
8.2
%
19.3
%
Acquired IPR&D expenses(2)
17.8
%
70.7
%
33.5
%
25.7
%
Acquisition-related – amortization of
purchased intangibles
4.0
%
4.7
%
4.6
%
5.0
%
Acquisition-related – other costs(4)
0.2
%
—
%
1.2
%
—
%
Other(5)
—
%
0.2
%
—
%
—
%
Non-GAAP operating margin(7)
52.5
%
49.3
%
47.6
%
49.9
%
Other income (expense), net
reconciliation:
GAAP other income (expense), net
$
(940
)
$
222
$
(848
)
$
817
Losses (gains) from equity securities,
net
969
(58
)
1,051
(312
)
Non-GAAP other income (expense), net
$
29
$
164
$
203
$
505
Effective tax rate
reconciliation:
GAAP effective tax rate
57.2
%
22.2
%
(903.4
)
%
17.9
%
Income tax effect of above non-GAAP
adjustments
(38.8
)
%
(0.1
)
%
923.3
%
2.2
%
Non-GAAP effective tax rate(7)
18.4
%
22.1
%
19.9
%
20.1
%
GILEAD SCIENCES, INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL INFORMATION(1) - (Continued)
(unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
(in millions, except percentages and
per share amounts)
2020
2019
2020
2019
Net income attributable to Gilead
reconciliation:
GAAP net income (loss) attributable to
Gilead
$
360
$
(1,165
)
$
(1,428
)
$
2,690
Acquired IPR&D expenses(2)
1,033
3,068
5,622
3,294
Acquisition-related – amortization of
purchased intangibles
225
247
673
759
Acquisition-related – other costs(4)
11
—
159
—
Losses (gains) from equity securities,
net
983
(66
)
1,090
(320
)
Discrete and related tax charges(3)
45
—
82
—
Other(5)
—
7
(2
)
5
Non-GAAP net income attributable to
Gilead
$
2,657
$
2,091
$
6,196
$
6,428
Diluted earnings per share
reconciliation:
GAAP diluted earnings (loss) per
share(6)
$
0.29
$
(0.92
)
$
(1.14
)
$
2.10
Acquired IPR&D expenses(2)
0.82
2.41
4.45
2.58
Acquisition-related – amortization of
purchased intangibles
0.18
0.19
0.53
0.59
Acquisition-related – other costs(4)
0.01
—
0.13
—
Losses (gains) from equity securities,
net
0.78
(0.05
)
0.86
(0.25
)
Discrete and related tax charges(3)
0.04
—
0.06
—
Other(5)
—
0.01
—
—
Non-GAAP diluted earnings per
share(6)(7)
$
2.11
$
1.64
$
4.90
$
5.03
Non-GAAP adjustment summary:
Cost of goods sold adjustments
$
266
$
266
$
798
$
822
Research and development expenses
adjustments
3
2
116
—
Acquired IPR&D expenses(2)
1,171
3,960
5,792
4,251
Selling, general and administrative
expenses adjustments
11
7
86
6
Other income (expense), net
adjustments
969
(58
)
1,051
(312
)
Total non-GAAP adjustments before tax
2,420
4,177
7,843
4,767
Income tax effect
(168
)
(921
)
(301
)
(1,029
)
Discrete and related tax charges(3)
45
—
82
—
Total non-GAAP adjustments after tax
$
2,297
$
3,256
$
7,624
$
3,738
________________________________
(1)
Beginning in the first quarter 2020,
Gilead no longer regularly excludes share-based compensation
expense from its non-GAAP financial information. To conform to this
change, the prior period non-GAAP financial information has been
recast to include share-based compensation expense.
(2)
Beginning in the second quarter 2020,
Acquired IPR&D expenses are presented separately from R&D
expenses in Gilead’s GAAP Condensed Consolidated Statements of
Operations. The amounts for prior periods have been reclassified to
conform to the current period presentation. Acquired IPR&D
expenses have been historically excluded from Gilead’s non-GAAP
financial information.
(3)
Amounts represent the reversal of the
deferred tax assets established in the fourth quarter 2019. The
reversal arose from the amortization of the intangible assets that
were transferred from a foreign subsidiary to Ireland and the
United States. The discrete tax benefit from the original
transaction was excluded from Gilead’s non-GAAP financial
information.
(4)
Includes primarily employee-related and
other expenses associated with Gilead’s acquisition of Forty
Seven.
(5)
Amounts represent restructuring,
contingent consideration and/or other individually insignificant
amounts.
(6)
Shares used in GAAP loss per diluted share
calculation for the nine months ended September 30, 2020 and three
months ended September 30, 2019 exclude all outstanding potentially
dilutive securities of 38 million and 40 million shares,
respectively. Shares used in non-GAAP diluted earnings per share
calculation for the nine months ended September 30, 2020 and three
months ended September 30, 2019 exclude potentially dilutive
securities of 12 million and 17 million shares, respectively.
Shares used in GAAP and non-GAAP diluted earnings per share for the
three months ended September 30, 2020 and nine months ended
September 30, 2019 exclude potentially dilutive securities of 13
million and 14 million shares, respectively.
(7)
Amounts may not sum due to rounding
differences.
GILEAD SCIENCES, INC.
RECONCILIATION OF GAAP TO
NON-GAAP 2020 FULL YEAR GUIDANCE(1)(2)
(unaudited)
(in millions, except percentages and
per share amounts)
Initially Provided
February 4, 2020
Previously Updated July
30, 2020
Updated October 28,
2020
Projected product gross margin GAAP to
non-GAAP reconciliation:
GAAP projected product gross margin
81% - 82%
81% - 82%
81% - 82%
Acquisition-related expenses
5%
5%
5%
Non-GAAP projected product gross
margin
86% - 87%
86% - 87%
86% - 87%
Projected operating income GAAP to
non-GAAP reconciliation:
GAAP projected operating income
$8,980 - $9,680
$3,700 - $6,000
$2,200 - $2,700
Acquisition-related and acquired IPR&D
expenses
1,120
7,000
8,500
Non-GAAP projected operating income
$10,100 - $10,800
$10,700 - $13,000
$10,700 - $11,200
Projected effective tax rate GAAP to
non-GAAP reconciliation:
GAAP projected effective tax rate
~ 23%
~ 50%
~110%
Amortization of deferred tax assets and
tax rate effects of adjustments noted above
(2)%
(29)%
(90)%
Non-GAAP projected effective tax rate
~ 21%
~ 21%
~ 20%
Projected diluted EPS GAAP to non-GAAP
reconciliation:
GAAP projected diluted EPS (loss per
share)
$5.15 - $5.55
$0.83 - $2.23
$(0.25) - $0.10
Acquisition-related, acquired IPR&D
expenses, amortization of deferred tax assets and historical fair
value adjustments of equity securities
0.90
5.42
6.50
Non-GAAP projected diluted EPS
$6.05 - $6.45
$6.25 - $7.65
$6.25 - $6.60
________________________________
(1)
Starting in 2020, Gilead no longer
regularly excludes stock-based compensation expense from its
non-GAAP financial information.
(2)
Excludes the impact of any potential
future acquisition-related, acquired IPR&D expenses (other than
those transactions announced herein which are expected to close in
the fourth quarter 2020) and other expenses, fair value adjustments
of equity securities and discrete tax and related charges or
benefits associated with changes in tax related laws and guidelines
as Gilead is unable to project such amounts.
GILEAD SCIENCES, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited)
September 30,
December 31,
(in millions)
2020
2019
Assets
Cash, cash equivalents and marketable
securities
$
26,049
$
25,840
Accounts receivable, net
3,913
3,582
Inventories
1,953
2,067
Property, plant and equipment, net
4,810
4,502
Intangible assets, net
12,939
13,786
Goodwill
4,117
4,117
Other assets
7,097
7,733
Total assets
$
60,878
$
61,627
Liabilities and Stockholders’
Equity
Current liabilities
$
9,509
$
9,759
Long-term liabilities
33,898
29,218
Stockholders’ equity(1)
17,471
22,650
Total liabilities and stockholders’
equity
$
60,878
$
61,627
________________________________
(1)
As of September 30, 2020 and December 31,
2019, there were 1,253 shares and 1,266 shares, respectively, of
common stock issued and outstanding.
GILEAD SCIENCES, INC.
PRODUCT SALES SUMMARY
(unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
(in millions)
2020
2019
2020
2019
Atripla – U.S.
$
99
$
132
$
275
$
387
Atripla – Europe
5
10
17
52
Atripla – Other International
9
7
19
33
113
149
311
472
Biktarvy – U.S.
1,584
1,106
4,346
2,868
Biktarvy – Europe
194
108
528
229
Biktarvy – Other International
113
45
314
71
1,891
1,259
5,188
3,168
Complera / Eviplera – U.S.
26
40
77
126
Complera / Eviplera – Europe
35
45
124
179
Complera / Eviplera – Other
International
9
8
17
26
70
93
218
331
Descovy – U.S.
424
256
1,124
735
Descovy – Europe
49
63
156
200
Descovy – Other International
35
44
103
128
508
363
1,383
1,063
Genvoya – U.S.
669
761
1,927
2,222
Genvoya – Europe
116
152
376
522
Genvoya – Other International
61
65
183
229
846
978
2,486
2,973
Odefsey – U.S.
309
317
851
865
Odefsey – Europe
116
111
341
328
Odefsey – Other International
12
8
36
27
437
436
1,228
1,220
Stribild – U.S.
27
63
100
208
Stribild – Europe
13
18
42
60
Stribild – Other International
2
13
12
30
42
94
154
298
Truvada – U.S.
492
688
1,245
1,896
Truvada – Europe
6
14
20
88
Truvada – Other International
11
19
37
61
509
721
1,302
2,045
Other HIV(1) – U.S.
10
3
24
23
Other HIV(1) – Europe
1
1
4
3
Other HIV(1) – Other International
2
1
21
11
13
5
49
37
Revenue share – Symtuza(2) – U.S
82
68
244
165
Revenue share – Symtuza(2) – Europe
34
36
112
89
Revenue share – Symtuza(2) – Other
International
2
—
6
—
118
104
362
254
Total HIV – U.S.
3,722
3,434
10,213
9,495
Total HIV – Europe
569
558
1,720
1,750
Total HIV – Other International
256
210
748
616
4,547
4,202
12,681
11,861
AmBisome – U.S.
18
9
46
27
AmBisome – Europe
58
57
166
174
AmBisome – Other International
35
33
113
96
111
99
325
297
GILEAD SCIENCES, INC.
PRODUCT SALES SUMMARY -
(Continued)
(unaudited)
Three Months Ended
Nine Months Ended
September 30,
September 30,
(in millions)
2020
2019
2020
2019
Ledipasvir/Sofosbuvir(3) – U.S.
$
36
$
54
$
113
$
257
Ledipasvir/Sofosbuvir(3) – Europe
11
14
26
63
Ledipasvir/Sofosbuvir(3) – Other
International
37
56
124
222
84
124
263
542
Letairis – U.S.
78
121
241
522
Ranexa – U.S.
—
31
9
205
Sofosbuvir/Velpatasvir(4) – U.S.
170
282
646
731
Sofosbuvir/Velpatasvir(4) – Europe
74
118
253
428
Sofosbuvir/Velpatasvir(4) – Other
International
86
116
330
341
330
516
1,229
1,500
Veklury – U.S.
785
—
785
—
Veklury – Europe
60
—
60
—
Veklury – Other International
28
—
28
—
873
—
873
—
Vemlidy – U.S.
99
78
248
214
Vemlidy – Europe
8
6
22
15
Vemlidy – Other International
70
50
194
122
177
134
464
351
Viread – U.S.
3
7
10
28
Viread – Europe
8
15
27
57
Viread – Other International
21
35
100
119
32
57
137
204
Vosevi – U.S.
33
42
93
140
Vosevi – Europe
9
12
26
43
Vosevi – Other International
3
9
13
18
45
63
132
201
Yescarta – U.S.
85
86
283
275
Yescarta – Europe
51
32
144
59
Yescarta – Other International
2
—
7
—
138
118
434
334
Zydelig – U.S.
8
13
24
36
Zydelig – Europe
9
13
30
42
Zydelig – Other International
—
—
1
1
17
26
55
79
Other(5) – U.S.
39
42
124
119
Other(5) – Europe
20
(21
)
54
96
Other(5) – Other International
2
4
6
12
61
25
184
227
Total product sales – U.S.
5,076
4,199
12,835
12,049
Total product sales – Europe
877
804
2,528
2,727
Total product sales – Other
International
540
513
1,664
1,547
$
6,493
$
5,516
$
17,027
$
16,323
____________________
(1)
Includes Emtriva and Tybost.
(2)
Represents Gilead’s revenue from
cobicistat (“C”), emtricitabine (“FTC”) and tenofovir alafenamide
(“TAF”) in Symtuza (darunavir/C/FTC/TAF), a fixed dose combination
product commercialized by Janssen Sciences Ireland UC.
(3)
Amounts consist of sales of Harvoni and
the authorized generic version of Harvoni sold by Gilead’s separate
subsidiary, Asegua Therapeutics LLC.
(4)
Amounts consist of sales of Epclusa and
the authorized generic version of Epclusa sold by Gilead’s separate
subsidiary, Asegua Therapeutics LLC.
(5)
Includes Cayston, Hepsera, Sovaldi and
Tecartus.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201028006099/en/
Investors Adam Levy, MBA,
Ph.D. (650) 574-3000
Douglas Maffei, Ph.D. (650) 574-3000
Media Amy Flood (650)
522-5643
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