Gilead Sciences ($GILD) reported another round of supercharged financial results on Tuesday, with sales more than doubling for the quarter to $7.3 billion and net income up more than fourfold to $3.5 billion. For the year, the Foster City, CA, biotech reported sales of nearly $25 billion and net income of $12.1 billion, as revenues from its hepatitis C treatment superstars, Sovaldi and combo drug Harvoni, both raked in huge revenues.
Harvoni, which was only approved in the U.S. in October and the EU about a month later, alone accounted for sales of $2.1 billion in the quarter. Sovaldi revenues were $1.7 billion, down significantly from the $2.8 billion it reported in Q3. Sales of Sovaldi in the third quarter fell short of analyst expectations of $2.96 million.
Still, as MarketWatch pointed out, with earnings of $2.43 per adjusted share, Gilead beat analyst predictions by $0.20 a share for Q4. The news sent Gilead's shares up 0.91% in after-hours trading shortly after it released the report.
The results are sure to spur renewed debate about whether its hep C products, which are changing hep C from a chronic disease with tough treatment options to an easily curable condition, are priced too high for the health system to bear. Some states have been putting restrictions on who can get the drugs through Medicaid. But a recent effort by Dr. Steve Miller, Express Scripts' CMO and a big critic of Gilead's pricing for Sovaldi and Harvoni, has spawned a price war. His company selected AbbVie's ($ABBV) cocktail Viekira Pak as its preferred hep C treatment when it was approved in December in an effort to undercut Gilead's price. Gilead has responded with exclusive deals of its own. Miller has suggested that the "price war" will save consumers $4 billion this year.Gilead CEO John Martin
On the flip side of that debate, the results are likely to bring more praise for Gilead CEO John Martin, who among other honors was recently named "best chief executive," an annual distinction handed out by investment firm Morningstar. It pointed out that the company's stock has grown 100 times over the 18 years he has been running Gilead. It has recorded a 157% gain just over the past two calendar years as its hep C drugs have been introduced.
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