Gilead Sciences 2023: Return to normalcy

While the company is no longer enjoying the benefit of enormous sales for its COVID treatment Veklury, Gilead is still doing very nicely, thank you very much.

By Joshua Slatko • [email protected]

 

Gilead Sciences

333 Lakeside Drive

Foster City, CA 94404

650-574-3000 • gilead.com

 

Financial Performance
	2022	2021	1H 2023	1H 2022
Revenue	$27,281	$27,305	$12,951	$12,850
Net income	$4,566	$6,201	$2,204	$1,147
Diluted EPS	$3.64	$4.93	$1.63	$0.92
R&D Expense	$4,977	$4,601	$2,854	$2,280
All figures are in millions of dollars, except EPS.

Best-selling products

All sales are in millions of dollars.

2022 sales

• Biktarvy $10,390 
• Veklury $3,905 
• Genvoya $2,404 
• Descovy $1,872 
• Sofosbuvir/Velpatasvir $1,530 
  
• Odefsey $1,469 
• Yescarta $1,160
• Vemlidy $842
• Trodelvy $680 
• Symtuza $530

1H 2023 sales

• Biktarvy $5,656 
• Genvoya $1,041 
• Descovy $965 
• Veklury $829
• Sofosbuvir/Velpatasvir $782 
  
• Yescarta $739 
• Odefsey $668 
• Trodelvy $482 
• Vemlidy $418 
• Symtuza $259 
• AmBisome $267

Outcomes Creativity Index Score: 14

• Manny Awards — N/A
• Cannes Lions — N/A
• Clio Health — 8
• Creative Floor Awards —5
• LIA: Pharma/Health & Wellness – N/A
• MM+M Awards — N/A
• One Show — 1

Gilead’s recent history is filled with shooting stars. Ten years ago Sovaldi and Harvoni more than doubled the company’s top line in a very short time before fading away as they wiped out hepatitis C in a large chunk of the population. Similarly, the COVID medicine Veklury generated more than $5 billion in sales in 2021 but has tailed off in parallel with the pandemic.

Generating less headlines than the shooting stars, though, are the anchors of Gilead’s portfolio, such as the HIV treatment Biktarvy, which passed $10 billion in sales for the first time last year; or the CAR T oncologic Yescarta, which crossed the $1 billion mark for the first time. So while the company’s top line has stayed more or less static for the past two years, it seems to be sitting on a strong foundation until the next shooting star comes along.

“It was another strong quarter for Gilead, with continued commercial and clinical momentum,” said Chairman and CEO Daniel O’Day in the company’s second quarter 2023 earnings announcement. “11 percent year-over-year growth across our base business was driven by our diverse portfolio of therapies for HIV, oncology, and liver disease. We received positive regulatory updates for six of our therapies and presented a large body of data on our pipeline, reinforcing our growing potential to help more patients and communities worldwide.”

Gilead’s top-line revenue was almost exactly the same in 2022 as it had been in 2021, falling just 0.01 percent to $27.28 billion. Net income, however, declined by 26.4 percent to $4.57 billion and earnings per share were down by $1.29 to $3.64. This drop was primarily due to a $2.7 billion charge for in-process research and development impairment related to changing estimates of the long-term value of Trodelvy after the Immunomedics acquisition in 2020. In the first half of 2023 Gilead’s top-line revenue was $12.95 billion, an increase of 0.8 percent, while net income nearly doubled from $1.15 billion to $2.20 billion and earnings per share were up by 71 cents to $1.63, with the same $2.7 billion charge from the previous year having the opposite effect this time. Gilead leaders are projecting that full-year 2023 EPS will be in the $4.50 – $4.85 range.

Acquisitions & partnerships

In January, Gilead and Evoq Therapeutics Inc. announced a collaboration and licensing agreement to advance Evoq’s proprietary technology for the treatment of rheumatoid arthritis and lupus. Evoq’s NanoDisc technology is designed to enable lymph-targeted delivery of disease-specific antigens and has the potential to change the paradigm for the treatment of autoimmune diseases. Under the agreement, Gilead and Evoq will collaborate on preclinical development. Gilead has the option to exclusively license rights to Evoq’s NanoDisc technology to pursue product candidates for RA and lupus indications and will be responsible for clinical development and commercialization.

That same month, Kite Pharma Inc., a Gilead Company,  and Arcellx Inc. announced the closing of the companies’ previously announced global strategic collaboration to co-develop and co-commercialize Arcellx’s lead late-stage product candidate, CART-ddBCMA, for the treatment of patients with relapsed or refractory multiple myeloma. Currently being investigated in a Phase II pivotal trial, CART-ddBCMA is Arcellx’s T-cell therapy utilizing the company’s novel synthetic binder, the D-Domain. Kite and Arcellx will jointly advance and commercialize the CART-ddBCMA asset in the United States, and Kite will commercialize the product outside the United States.

In February, Kite announced the completion of the previously announced transaction to acquire Tmunity Therapeutics, a clinical-stage, private biotech company focused on next-generation CAR T-therapies and technologies. According to company leaders, the acquisition of Tmunity complements Kite’s existing in-house cell therapy research capabilities by adding additional pipeline assets, platform capabilities, and a strategic research and licensing agreement with the University of Pennsylvania. It will provide Kite with access to pre-clinical and clinical programs, including an “armored” CAR T technology platform, which potentially could be applied to a variety of CAR T’s to enhance anti-tumor activity, as well as rapid manufacturing processes. In addition, as part of the acquisition, the Tmunity founders, who remain in their roles at Penn, will also provide consulting services to Kite as senior scientific advisors.

In March, Gilead exercised its option to exclusively license Nurix Therapeutics Inc.’s investigational targeted protein degrader molecule NX‑0479. This bivalent degrader, designated GS-6791, is the first development candidate resulting from the previously announced Nurix-Gilead collaboration to discover, develop, and commercialize a pipeline of innovative targeted protein degradation therapies.

GS-6791 is a potent, selective, oral IRAK4 degrader that targets both the scaffold and kinase functions of the IRAK4 protein kinase to block inflammatory responses downstream of toll-like receptors (TLR) and the pro-inflammatory IL1 cytokine family of receptors (IL1Rs). Degradation of IRAK4 by GS-6791 is hypothesized to have more sustained and deeper inhibition of TLR/IL1Rs signaling as compared to kinase inhibition due to its potential impact on additional signaling nodes. IRAK4 degradation has potential applications in the treatment of rheumatoid arthritis (RA) and other inflammatory diseases.

In May, Gilead and Arcus Biosciences Inc. expanded their previously announced research collaboration focused on oncology to include therapies for the treatment of inflammatory diseases. The expanded collaboration builds upon Gilead’s growing presence in inflammatory disease and serves as a step towards broadening Arcus’ capabilities and portfolio beyond oncology and into inflammation.

Under the terms of the expanded collaboration, Arcus received an upfront payment of $35 million and will initiate research programs against up to four targets jointly selected by the parties that are applicable to inflammatory diseases. Gilead may exercise an option to license each program at two separate, prespecified time points. If Gilead exercises its option at the earlier time point for the first two target programs, Arcus would be eligible to receive up to $420 million in option and milestone payments and tiered royalties for each optioned program. For any other option exercise by Gilead for the four target programs, the parties would have rights to co-develop and share global development costs and to co-commercialize and share profits in the United States for optioned programs.

Also in May, Gilead announced the acquisition of all outstanding shares of XinThera, a privately held biotech company in San Diego. According to executives, the acquisition complements Gilead’s existing clinical development priorities by adding additional pipeline assets for well-validated targets in oncology and inflammation. Through the acquisition, Gilead gained rights to a portfolio of small molecule inhibitors targeting PARP1 for oncology and MK2 for inflammatory diseases that could enter clinical trials later this year. Both programs have the potential to address multiple indications, offering broad development opportunities alone and in combination with Gilead’s portfolio.

In June, Kite announced that the Marketing Authorization in Japan for Yescarta, a chimeric antigen receptor (CAR) T-cell therapy, had been transferred from Daiichi Sankyo Co. to Gilead Sciences K.K., the Japan subsidiary of Gilead. This followed the announcement made by Daiichi Sankyo and Kite in December 2022 about changes to their initial 2017 partnership whereby Daiichi Sankyo obtained the Marketing Authorization for Yescarta. With this completion of the Marketing Authorization transfer, the sales and promotion activities of Yescarta in Japan now will be managed by the Kite Cell Therapy Business Unit of Gilead Sciences K.K.

In August, Gilead and Tentarix Biotherapeutics established three multi-year collaborations leveraging Tentarix’s proprietary Tentacles platform to discover and develop multi-functional, conditional protein therapeutics for oncology and inflammatory diseases. Designed to enhance both therapeutic benefit and safety, these molecules have the potential to conditionally target immune cells related to disease pathways without activating other immune cells that may create adverse events. Across the three collaborations, Tentarix received upfront payments and an equity investment from Gilead totaling $66 million. Gilead has the option to acquire up to three select Tentarix subsidiaries containing the programs developed under the collaborations for $80 million per subsidiary.

Product performance

The single-tablet HIV treatment Biktarvy remained at the top of Gilead’s product portfolio in 2022 with sales of $10.39 billion, a 20.5 percent improvement over the previous year and still the most for any HIV medicine worldwide. According to company leaders this primarily reflected higher demand in addition to favorable pricing dynamics, partially offset by inventory dynamics. In the first half of 2023 sales of Biktarvy rose another 20.2 percent to $5.66 billion.

Veklury, for the treatment of COVID-19, generated sales of $3.91 billion in 2022, a decline of 29.8 percent, due to the overall decrease in COVID-related hospitalizations. In the first half of 2023 sales of Veklury declined by another 58.1 percent to $829 million.

In February, Gilead announced positive data from three retrospective real-world studies, which demonstrated that initiation of Veklury within the first two days of hospital admission can help reduce mortality and hospital readmission rates among all patients hospitalized with COVID-19, regardless of disease severity. A reduction in mortality was also observed in vulnerable populations, such as people living with cancer or HIV. These studies evaluated routine clinical practice data from more than 800 U.S. hospitals to gain insights on patient outcomes as COVID-19 continues to evolve over time.

Two studies analyzed clinical practice information from the U.S. Premier Healthcare databases of more than 500,000 adult patients hospitalized with COVID-19. The overall analysis examined all-cause inpatient mortality rates at 14- and 28- days and demonstrated that initiation of Veklury within the first two days of hospital admission was associated with a statistically significant lower risk for mortality in all oxygen levels compared to matched controls that did not receive Veklury during their hospitalization for COVID-19. For patients with no documented use of supplemental oxygen at baseline, treatment with Veklury was associated with a 19 percent lower risk of mortality at Day 28. Patients on low-flow or high-flow oxygen also had a 21 percent and 12 percent lower risk of mortality at Day 28, respectively. Patients on invasive mechanical ventilation/ECMO at baseline had a 26 percent reduced risk for mortality at Day 28. These findings were observed throughout all variant time periods, including Omicron, in patients who did not require supplemental oxygen and across all levels of supplemental oxygen use, including those on invasive mechanical ventilation (IMV)/ECMO.

In July, FDA approved a supplemental new drug application for the use of Veklury in COVID-19 patients with severe renal impairment, including those on dialysis. With this approval, Veklury became the first and only approved antiviral COVID-19 treatment that can be used across all stages of renal disease. This approval for use in patients with severe renal impairment was based on results from a Phase I study (GS-US-540-9015), as well as results from the Phase III REDPINE trial that demonstrated the pharmacokinetics and safety profile of Veklury in this population.

In August, FDA approved a supplemental new drug application for the use of Veklury with no dose adjustments to treat COVID-19 in people with mild, moderate, and severe hepatic impairment. This approval further supports the safety profile of Veklury as the first and only approved antiviral COVID-19 treatment that can be used across all stages of liver disease. This latest approval was based on results from a Phase I study of safety and pharmacokinetics in people with hepatic impairment (GS-US-540-9014). No new safety signals were observed. Based upon these results, the label has been updated to reflect that no dose adjustment is required across all stages of liver disease.

The four-drug combination HIV treatment Genvoya brought in sales of $2.4 billion for Gilead in 2022, a decline of 16.5 percent compared with the previous year. In the first half of 2023 sales of Genvoya fell another 10.6 percent to $1.04 billion.

Descovy, for treatment of HIV and HIV PrEP, generated sales of $1.87 billion in 2022, up 10.1 percent for the year.  Gilead leaders say the improvement was primarily driven by favorable pricing dynamics and higher demand, partially offset by inventory dynamics. In the first half of 2023, sales of Descovy rose another 15.7 percent to $965 million.

The CAR T oncologic Yescarta showed some of the most impressive growth in Gilead’s portfolio in 2022, with sales rising by just over two thirds to $1.16 billion due to higher demand in relapsed or refractory large B-cell lymphoma. In the first half of 2023, sales of Yescarta rose another 46 percent to $739 million.

In June, Kite announced detailed results from the overall survival analysis of the landmark Phase III ZUMA-7 study of Yescarta CAR T-cell therapy compared with historical standard of care as initial treatment in the curative setting for patients with relapsed or refractory large B-cell lymphoma (R/R LBCL). Yescarta is the first treatment in nearly 30 years to demonstrate a significant improvement in survival in this patient population. With a median follow-up of four years (47.2 months), a one-time treatment with Yescarta demonstrated significantly longer overall survival compared to SOC with a 27.4 percent reduction in the risk of death, which corresponds to a 38 percent relative improvement in overall survival, for patients with R/R LBCL within 12 months completion of first-line therapy.

The breast cancer treatment Trodelvy was another highlight of Gilead’s portfolio in 2022, with sales jumping by nearly 80 percent to $680 million. According to company leaders, this reflected continued adoption in metastatic triple-negative breast cancer in the United States and Europe. In the first half of 2023, sales of Trodelvy rose another 58 percent to $482 million.

In February, FDA approved Trodelvy for the treatment of adult patients with unresectable locally advanced or metastatic hormone receptor (HR)-positive, human epidermal growth factor receptor 2 (HER2)-negative (IHC 0, IHC 1+ or IHC 2+/ISH–) breast cancer who have received endocrine-based therapy and at least two additional systemic therapies in the metastatic setting. The approval was based on statistically significant and clinically meaningful progression-free survival and overall survival data from the Phase III TROPiCS-02 study. Trodelvy is now also recommended as a Category 1, preferred treatment for metastatic HR+/HER2- breast cancer by the National Comprehensive Cancer Network as defined in the Clinical Practice Guidelines in Oncology. A similar indication was approved by the European Commission in July.

The approvals were based on the Phase III TROPiCS-02 study, in which Trodelvy demonstrated a statistically significant and clinically meaningful overall survival  benefit of 3.2 months versus comparator single-agent chemotherapy (treatment of physician’s choice; TPC) (median OS: 14.4 months versus 11.2 months). Trodelvy also demonstrated a 34 percent reduction in risk of disease progression or death (median PFS: 5.5 versus 4.0 months). Three times as many people treated with Trodelvy were progression-free at one year versus those treated with chemotherapy (21 percent versus 7 percent).

That same month, Gilead announced new and updated positive results from three cohorts of the Phase II TROPHY-U-01 study of Trodelvy for the treatment of metastatic urothelial cancer (mUC). These data demonstrate that Trodelvy produced both rapid and durable responses for patients across a range of hard-to-treat types of mUC including platinum-ineligible and rapidly progressing, post-platinum mUC. Trodelvy has not been approved by any regulatory agency for the treatment of platinum-ineligible patients with mUC who progressed after prior CPI therapy, or in combination with pembrolizumab in patients with mUC who progressed after platinum-based therapy. Its safety and efficacy have not been established for these indications.

In September, Gilead announced promising early data from the global, open-label, Phase II EVOKE-02 study evaluating Trodelvy in combination with Merck’s anti-PD-1 therapy Keytruda with or without platinum agents in patients with previously untreated advanced or metastatic non-small cell lung cancer without actionable genomic alterations.

The preliminary analysis of the EVOKE-02 study included results of two cohorts: Trodelvy in combination with Keytruda in first-line advanced or metastatic squamous/non-squamous NSCLC with PD-L1 tumor proportion score (TPS) ≥ 50% (Cohort A) and TPS < 50% (Cohort B). In Cohort A, confirmed and unconfirmed objective response rate was 69 percent, and disease control rate was 86 percent. In Cohort B, confirmed and unconfirmed ORR was 44 percent, and DCR was 78 percent. Across both cohorts, the ORR was 56 percent, and DCR was 82 percent. Median duration of response was not reached at the time of data cut-off, and DoR rate at six months was 88 percent in both cohorts.

In the pipeline

In February, Kite announced the three-year follow-up results from the pivotal ZUMA-3 study of the CAR T-cell therapy Tecartus. Results from the analysis showed a median overall survival of 26 months and demonstrated that responses remained durable in adults with relapsed/refractory B-cell acute lymphoblastic leukemia (R/R B-ALL) with a consistent safety profile observed since the two-year analysis.

In the Phase II treated patient cohort the median follow-up was 38.8 months (range, 32.7-44.6). The OS rate at 36.0 months was 47.1 percent, with a median OS of 26.0 months among all treated Phase II patients and 38.9 months in patients with complete remission or complete remission with incomplete hematologic recovery. Overall CR rate, CR, and subsequent allogeneic stem cell transplant (alloSCT) rates remained unchanged since the prior data cut at 71 percent, 56 percent, and 20 percent, respectively. Median relapse-free survival censored and not censored at subsequent alloSCT were both 11.6 (2.7-20.5) and 11.7 months (2.8-20.5), respectively.

Also in June, Kite announced findings from the largest real-
world analysis to date of Tecartus in patients with relapsed or refractory mantle cell lymphoma (R/R MCL), which showed that outcomes of Tecartus therapy had consistent high complete response and overall response rates, regardless of type of prior treatment, including: Bruton’s tyrosine kinase inhibitor (BTKi), bendamustine or autologous hematopoietic cell transplant (autoHCT). Higher CR was seen when Tecartus was given as second-and-third-line compared to later lines of treatment.

With median follow-up of 12 months, ORR was 90 percent, which was similar to ZUMA-2 results, and high CR (78 percent) was seen in patients who received Tecartus. Additionally, at 12 months, duration of response (since earliest CR/partial response), progression-free survival, and overall survival rates were 64 percent, 61 percent, and 74 percent respectively. Grade 3 or higher cytokine release syndrome (CRS) and immune effector cell-associated
neurotoxicity syndrome (ICANS) (based on American Society for Transplantation and Cellular Therapy (ASTCT) criteria) incidence were 10 percent and 28 percent respectively.

That same month, Gilead announced Week 96 results from the pivotal MYR301 Phase III clinical trial evaluating the first-in-class entry inhibitor Hepcludex (bulevirtide) for the treatment of adults with chronic hepatitis delta (HDV) infection. Bulevirtide is the only approved treatment for HDV in the EU and is not approved in the United States.

The new findings (OS-068) reinforced the efficacy and safety of bulevirtide and demonstrated that additional improvements in combined response are observed at Week 96 compared with Week 48, with no signs of treatment resistance. An additional analysis from the MYR301 Phase III trial showed that study participants who appeared to not respond or only partially respond to bulevirtide treatment at Week 24, went on to achieve a virologic response at 96 Weeks with continued bulevirtide monotherapy.

Also in June, Gilead and Arcus announced updated results from an interim analysis of the ARC-7 study in patients with first-line, metastatic non-small cell lung cancer (NSCLC) with PD-L1 tumor proportion score (TPS) ≥50% without epidermal growth factor receptor (EGFR) or anaplastic lymphoma kinase (ALK) mutations. ARC-7 is the first Phase II, randomized, open-label study evaluating the combinations of Fc-silent anti-TIGIT monoclonal antibody domvanalimab plus anti-PD-1 monoclonal antibody zimberelimab (doublet) and domvanalimab plus zimberelimab and etrumadenant, an A2a/b adenosine receptor antagonist (triplet), versus zimberelimab monotherapy. With a median follow-up time of approximately 18 months, both domvanalimab-containing study arms demonstrated sustained, clinically meaningful improvements in progression-
free survival) compared to zimberelimab monotherapy, with a 33 percent reduction in risk of disease progression or death for the doublet and 28 percent for the triplet.

In July, Gilead presented new data reinforcing the efficacy, safety, and tolerability profile of lenacapavir, including patient-reported outcomes from the Phase II/III CAPELLA trial. These latest findings underscore the role of lenacapavir, the first long-acting injectable HIV treatment medication administered twice-yearly, as a person-centric therapy option and its transformative potential impact on the future of coordinated HIV clinical care.

Using five validated scoring instruments measuring health-related quality of life components including physical and mental health, CAPELLA participants (n=64/72) reported favorable scores at Week 52 and with relative consistency over the time period. These reflect values that are similar to that of the general U.S. population. Separate analyses from the Phase II/III CAPELLA and Phase II CALIBRATE trials showed weekly oral lenacapavir, when paired with an OBR, led to high rates of virologic suppression and high, efficacious concentrations of lenacapavir in the blood in study participants when the administration of subcutaneous lenacapavir was interrupted.

In August, FDA placed a partial clinical hold on the initiation of new patients in U.S. studies evaluating magrolimab to treat acute myeloid leukemia (AML). The FDA action followed the previously announced discontinuation of the Phase III ENHANCE study of magrolimab in higher-risk myelodysplastic syndromes. Studies of magrolimab in solid tumors are continuing without any impact from the FDA action.