Following a steady stream of acquisitions that culminated in three biotech buyouts earlier this year, Gilead Sciences’ CEO has told Fierce how the company’s efforts to expand into oncology and inflammation have reached “critical mass.”
“We have a portfolio that is generating things from early research into development,” O’Day explained in an interview on the sidelines of a recent event at Gilead's California headquarters. Future M&A activity, he added, would now be done only to complement the foundation that has been laid since just before he took over as CEO in 2019.
Two years before O’Day’s arrival, Gilead made a massive play to expand away from its virology roots by buying Kite Pharma for $12 billion, just before the cell therapy specialist’s lymphoma med Yescarta secured approval. When O’Day took the reins after a 32-year career at Roche, the new CEO didn’t take long to top that acquisition with the astronomical $21 billion purchase of Immunomedics in 2020. The buyout bestowed Gilead with the now-blockbuster breast cancer med, Trodelvy.
Under O’Day’s tenure, Gilead also began building out an inflammation business led by the 2024 approval of Livdelzi for primary biliary cholangitis, which the company had acquired in the $4.3 billion purchase of CymaBay Therapeutics just six months prior. PBC is a liver disease, and pursuing Livdelzi as a first step into inflammation allowed Gilead to harness the connections it had made through the success of its hepatitis franchise.
The final pieces of the portfolio-building puzzle came together earlier this year, when Gilead bought CAR-T company Arcellx for $7.8 billion, T-cell-engager specialist Ouro Medicines for up to $2.2 billion and German antibody-drug conjugate (ADC) outfit Tubulis for $3.1 billion upfront.
Some of those companies had a history with Gilead. Arcellx was previously a partner to Gilead’s Kite on the hotly anticipated CAR-T candidate anito-cel, which is expecting an FDA approval decision in December. Tubulis first teamed up with the Foster City pharma in 2024.
These three acquisitions, O’Day told Fierce, fit neatly within the framework that was established by Gilead’s earlier expansion efforts in cancer and inflammation.
“If you go back seven, eight years ago when many of us arrived, we more than doubled our investment in research and development over that period of time,” O'Day said, referring to the numerous new executives he brought on board at the start of his tenure. “With that comes the need to also increase the talented colleagues we get to work with.”
Gilead now employs around 17,000 people globally, O'Day added, including 7,400 in California. Of those, 4,700 call the Foster City headquarters home.
Fostering science
The Foster City site recently welcomed a fresh addition in the form of a 182,000-square-foot research center. While the center has actually been operational since this summer, the official ribbon-cutting event only took place last week.
Just across the way, another new building—the Technical Development Center—is under construction with a planned open date of late 2027, while a biologics manufacturing facility called Chess recently broke ground and is slated for completion in 2029.
All three new buildings are part of Gilead’s commitment to invest $32 billion in the U.S., an effort the company started trumpeting last year alongside similar plans from many of its peers in the wake of President Donald Trump’s return to office.
The new research center is connected via skybridge to an only slightly older research building that opened around the start of O’Day’s leadership. That older building “was at the time the largest square foot research facility in the state of California,” O’Day said in his remarks during the ribbon-cutting event. “We've already grown out of it.”
The proximity of the new research center to the Technical Development Center “allows our scientists to be co-located,” O’Day explained in his remarks. “That's one of the secret sauces of Gilead.”
Though the new center will focus on cancer and inflammation, it will do so without Gilead “ever taking our eye off of virology,” O’Day added.
Gilead is an old name in biotech circles—the company will celebrate its 40th anniversary next year—and the world has changed a lot since its 1987 founding. While California’s Bay Area, particularly South San Francisco, is the birthplace of biotech, innovation has since gone global.
“We source innovation from everywhere in the world,” O’Day told Fierce at the event. He highlighted the Tubulis acquisition as an example; not only did the buyout give Gilead a promising early-stage ovarian cancer drug, the biotech has morphed into a Munich-based research unit focused on ADCs.
“We also spend time in China looking for innovation there, [as well as] other parts of Europe and around the globe,” the CEO added.
But with the ink finally starting to dry on this deal flurry, don’t expect Gilead to open its checkbook again anytime soon.
“The strength of our internal research portfolio and pipeline is unlike anything we've ever seen in the history of Gilead,” Chief Financial Officer Andrew Dickinson told Fierce at the event. “We've put ourselves in a position where more and more of our future product launches should be coming from our internal research.”
While the company is keeping a close eye on China, Gilead currently has no plans to expand its physical footprint in the country, Dickinson confirmed to Fierce. The pharma's China base sits in Shanghai, with another office in Hong Kong.
“Innovation is global,” Flavius Martin, M.D., Gilead’s executive vice president of research, echoed to Fierce after the ribbon cutting. When it comes to adding on top of what Gilead has already built through future M&A, “you need an internal engine that can figure out what good looks like” along with “a great corporate development engine to help you identify those opportunities.”
“We are fully in steady state,” Martin told Fierce, “and continue to build the portfolio in a complementary fashion.”
Critical mass
Not all of Gilead’s oncology and inflammation gambles have paid off, and the pharma is also squaring up in arenas that are already jam-packed with competitors. For example, Gilead’s Chief Medical Officer Dietmar Berger, M.D., Ph.D., previously told Fierce of the company’s interest in RAS inhibitors, a field awash with rivals led by Revolution Medicines and its breakthrough drug, Rasonque.
Bristol Myers Squibb recently shared positive phase 3 data from a potential Trodelvy competitor, and Gilead scrapped the lead rheumatoid arthritis candidate from its $405 million acquisition of MiroBio back in May. A big swing on the troubled cancer target TIGIT also unraveled after a phase 3 miss around the same time, leading Gilead to pull back from its partnership with Arcus Biosciences on the antibody.
Even in virology, where Gilead made its name and still dominates today, rivals are circling; in July, Atea Pharmaceuticals’ hepatitis C prospect matched Gilead’s Epclusa in a phase 3 trial.
But a quick look at Gilead’s pipeline shows a broad swath of other potential shots on goal, including many drugs still in phase 1 trials. This abundance of early-stage work, at one of the biotech world’s oldest companies, could be seen as a reflection of another point CEO O’Day made during his ribbon-cutting remarks—in the grand scheme of things, Gilead is still just getting started.
“Gilead started 40 years ago with an idea around virology, around a scientific ethos to not only make a difference in science but make a huge global impact,” O’Day told attendees. “We're really still at the beginning of our story.”