Gilead re­ports mas­sive Q2 earn­ings jump thanks to So­valdi

Modern Healthcare - - NEWS - By Vir­gil Dick­son

Gilead Sciences’ sec­ond-quar­ter earn­ings blew through year-ago lev­els, thanks in part to its block­buster, con­tro­ver­sial hep­ati­tis C drug So­valdi.

Sales of So­valdi reached $3.5 bil­lion in the sec­ond quar­ter and al­most $6 bil­lion for the first six months of the year, Gilead re­ported last week.

Over­all, Gilead saw to­tal rev­enue for the sec­ond quar­ter jump to $6.5 bil­lion com­pared with $2.8 bil­lion for the same pe­riod in 2013. Sec­ond-quar­ter net in­come hit $3.7 bil­lion com­pared with $772.6 mil­lion in the same pe­riod last year.

At $1,000 a pill and $84,000 for a three-month course of treat­ment, So­valdi’s pric­ing has gar­nered wide­spread crit­i­cism and raised con­cerns about its cost im­pact on pub­lic and pri­vate in­sur­ers.

John Martin, Gilead’s CEO, said dur­ing an earn­ings call last week that as more peo­ple be­come cured of hep­ati­tis C be­cause of So­valdi, price con­cerns will abate. Since re­ceiv­ing Food and Drug Ad­min­is­tra­tion ap­proval last year, the drug has cured 9,000 peo­ple. “Over time, the health­care sys­tem will save a lot of money by these pa­tients be­ing healthy again,” he said.

Gilead re­vised its full-year rev­enue es­ti­mate to a range of $21 bil­lion to $23 bil­lion, dou­ble its ear­lier fore­cast of $11.3 bil­lion to $11.5 bil­lion, thanks to So­valdi sales.

Dur­ing the call, Martin cred­ited some of So­valdi’s suc­cess to the wide buy-in of state Med­i­caid pro­grams. He said only three states do not cover the drug, but they are ex­pected to do so once they fin­ish draft­ing prior au­tho­riza­tion re­quire­ments.

Pri­vate in­sur­ers and some state Med­i­caid pro­grams con­tinue to push for Gilead to cut the price. “While it was a block­buster quar­ter for Gilead, peo­ple who can’t ac­cess the drug be­cause of its price didn’t fare nearly as well,” Bren­dan Buck, a spokesman for Amer­ica’s Health In­sur­ance Plans, said in a writ­ten state­ment. “The cur­rent price can­not be jus­ti­fied by devel­op­ment costs; it’s purely a re­flec­tion of Gilead be­liev­ing that it has a blank check.”

Sales of So­valdi reached $3.5 bil­lion in the sec­ond quar­ter and al­most $6 bil­lion for the first six months of the year.

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