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Analyst Blog

Gilead Sciences, Inc. (GILD - Analyst Report) performed very well in the second quarter of 2013 driven by its strong product portfolio. The robust sales of newly launched products like Complera/Eviplera and Stribild are very encouraging.

Stribild has performed well since launch in the U.S. in Aug 2012. Sales of the drug climbed 8% sequentially to $99.4 million in the second quarter of 2013. The EU approval of the drug in May 2013 has boosted the sales potential of the drug. Sales of Complera/Eviplera, launched in 2011, climbed 27% sequentially to $188.7 million in the second quarter of 2013. We expect these products to continue performing well.

The product portfolio was further strengthened by the European approval of HIV drug cobicistat (150 mg version). The drug will be marketed in the EU under the trade name Tybost.

The drug acts as a “boosting” agent for the HIV protease inhibitors - such as Reyataz (atazanavir) and Prezista (darunavir) - enabling the HIV therapy to be dosed once daily.

The approval by the EC was based on positive data from a phase III study (114) which showed that cobicistat was non-inferior to AbbVie Inc.’s (ABBV - Analyst Report) HIV therapy Norvir (ritonavir)  over 48 weeks in treatment naïve HIV patients. Approval was also based on pharmacokinetic data which revealed that the addition of cobicistat boosted the exposure of HIV therapies Reyataz and Prezista similar to Norvir. We note that cobicistat is a component of the HIV combination pill Stribild.

Gilead expects 2013 product revenue in the range of $10–$10.2 billion, reflecting an increase of 6%–9% over 2012 levels. We expect Gilead to easily achieve the guidance driven by its strong product portfolio.

Gilead currently carries a Zacks Rank #3 (Hold).  However, stocks such as Roche (RHHBY - Analyst Report) and Eli Lilly and Company (LLY - Analyst Report) appear to be more attractive.  Roche carries a Zacks Rank #1 (Strong Buy) while Eli Lilly carries a Zacks Rank #2 (Buy).