GILD Gilead Sciences Inc

Gilead Sciences, Inc (GILD) is all set to file regulatory applications in the US for its much anticipated pipeline candidate, Quad, by the end of this year. The Quad pill is a combination of Gilead’s pipeline candidate elvitegravir, cobicistat (GS 9350), and Truvada, Gilead’s popular HIV medicine.

The new drug application (NDA) will include data from studies 102 and 103. Study 103 (n=708) compared Quad to a combination of ritonavir boostedReyatazand Truvada. Reyataz is marketed by Bristol Myers Squibb (BMY) for HIV.

The data showed that the Quad pill was non-inferior to ritonavir-boosted Reyataz plus Truvada at week 48. 90% of the patients who were treated with Quad achieved a reduction in viral load factor versus 87% of those who were treated with ritonavir boostedReyatazand Truvada.

Study 102 compared the candidate to Gilead’s popular HIV medicine, Atripla. Atripla, a single tablet regimen (STR) for HIV, is jointly marketed by Bristol-Myers Squibb and Gilead. Atripla is a combination of Truvada and Bristol Myers’ Sustiva. Data from the study showed that Quad worked equally well as Atripla at week 48. Both the blinded studies will continue for 96 weeks to further evaluate the safety and effectiveness of Quad.

Gilead will request the US Food and Drug Administration (FDA) to grant priority review status to the NDA, which if granted is expected to lead to approval of Quad by mid 2012.  We believe the positive outcomes of studies 102 and 103 will lead to approval of Quad. On approval, Quad has the potential to reach blockbuster status and become a market leading HIV medicine.

Our Recommendation

We currently have a Neutral recommendation on Gilead.

We are optimistic on the growth potential of Gilead’s HIV franchise drugs, Truvada and Atripla. Moreover Gilead’s strategy of creating fixed-dose combinations of existing HIV drugs has yielded enormous success. We believe the recently approved HIV combination pill Complera/Eviplera together with Quad, once approved, has the potential to drive sustainability of the HIV franchise.

However, we are concerned about patent challenges to its key HIV drugs. We maintain a cautious stance until Complera along with the current pipeline proves its worth, compensating for lost revenues from patent lapses.

 
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