Gilead's Q4 Revenue Drops on Weak HIV, COVID Sales, and Phase III Failures

Gilead experienced a 4% year-over-year revenue decline in the fourth quarter of 2023, largely due to reduced sales in its COVID-19 and HIV divisions, as revealed in their recent earnings report.

Veklury (remdesivir), Gilead's COVID-19 antiviral medication, generated $720 million during the fourth quarter, marking a 28% drop from the $1 billion it earned in the same period the prior year. Similarly, the company's HIV segment saw a slight revenue decrease, falling 2% from $4.77 billion in Q4 2022 to $4.69 billion in the latest quarter.

Gilead also noted a 21% reduction in royalties, contracts, and other revenues in the fourth quarter of 2023.

Although Gilead's oncology sector showed robust growth, with sales increasing 24% year-over-year from $614 million to $765 million, this success wasn't sufficient to counterbalance the declines in other areas. Overall, the company's total revenue for Q4 2023 hit just over $7.11 billion, a 4% decrease from nearly $7.39 billion in Q4 2022.

Additionally, Gilead disclosed that its Phase III EVOKE-01 study of Trodelvy (sacituzumab govitecan-hziy) for breast cancer failed to meet its primary endpoint. The study did not show a significant improvement in overall survival compared to docetaxel in previously treated metastatic non-small cell lung cancer (NSCLC) patients.

The company's Phase III OAKTREE study of the antiviral drug obeldesivir for non-hospitalized, low-risk COVID-19 patients also failed. While obeldesivir was well-tolerated, it did not significantly speed up the time to symptom relief.

In response to these quarterly results, Gilead’s shares fell by 3% in post-market trading.

Despite the disappointing quarterly performance, Gilead's CEO, Daniel O’Day, remained optimistic, citing "consistent growth in our base business" and forecasting further growth in 2024.

“This is a catalyst-rich phase for Gilead, with more than 20 updates this year and many more to come beyond 2024,” O’Day stated.

Upcoming updates will include clinical results from the Phase III TROPiCS-04 study of Trodelvy in second-line metastatic urothelial carcinoma and the Phase II EVOKE-02 study in first-line metastatic NSCLC. Moreover, Gilead plans to share news on its Phase III PURPOSE 1 study, which examines lenacapavir for HIV pre-exposure prophylaxis.

With these and other key milestones in 2024, Gilead anticipates total product sales to range between $27.1 billion and $27.5 billion.