Hard times for Gilead

Gilead Sciences reported its full year and fourth quarter 2016 results. Sales for the Californian biotech group were 20% lower than in 2015, due to its two blockbusters targeting hepatitis C, Harvoni and Sovaldi, steadily declining (-32%). In addition, Gilead expects between $7.5bn and $9bn in sales for its hepatitis C franchise this year, whereas analysts expected approximately $11.5bn. Such hardship is mainly due to a strong pressure by insurers, who are forcing the group to grant discounts on drugs up to 60%. In addition to this, the number of patients with hepatitis C is steadily decreasing. Indeed, between 150,000 and 175,000 new patients are expected this year in the US, a significant decrease from 230,000 in 2016. Good news for Gilead are coming from the sales performance of new drugs such as Genvoya, Truvada and Epclusa. Gilead’s shares (Wall Street) were 10% below yesterday’s closing price as trading opened today. (Sources WSJ and Gilead)