Gilead Sciences (GILD) 10-Q 5 Nov 09 2009 Q3 Quarterly report Financial data

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Thousands	9 Months Ended Sep. 30, 2009	9 Months Ended Dec. 31, 2008
Current assets:
Cash and cash equivalents	$1,024,599	$1,459,302
Short-term marketable securities	330,713	330,760
Accounts receivable, net	1,339,165	1,023,397
Inventories	1,017,827	927,868
Deferred tax assets	192,701	140,882
Prepaid taxes	249,500	198,318
Prepaid expenses	83,391	71,815
Other current assets	59,714	126,066
Total current assets	4,297,610	4,278,408
Property, plant and equipment, net	701,371	528,799
Noncurrent portion of prepaid royalties	231,956	257,208
Noncurrent deferred tax assets	134,417	226,728
Long-term marketable securities	1,936,818	1,449,577
Intangible assets	1,555,602	123,008
Other noncurrent assets	79,206	73,103
Total assets	8,936,980	6,936,831
Current liabilities:
Accounts payable	742,684	601,200
Accrued government rebates	228,707	176,939
Accrued compensation and employee benefits	127,691	103,840
Income taxes payable	139,536	44,757
Other accrued liabilities	395,656	245,662
Deferred revenues	49,362	42,963
Current portion of other long-term obligations	205,613	5,631
Total current liabilities	1,889,249	1,220,992
Long-term deferred revenues	44,567	74,181
Convertible senior notes, net	1,140,887	1,098,025
Long-term income taxes payable	67,757	56,588
Other long-term obligations	42,363	21,462
Commitments and contingencies (Note 11)	-	-
Stockholders' equity:
Preferred stock, par value $0.001 per share; 5,000 shares authorized; none outstanding	0	0
Common stock, par value $0.001 per share; 2,800,000 shares authorized; 901,816 and 909,819 shares issued and outstanding at September 30, 2009 and December 31, 2008, respectively	902	910
Additional paid-in capital	4,264,222	3,930,109
Accumulated other comprehensive income (loss)	(39,199)	41,240
Retained earnings	1,420,613	300,314
Total Gilead stockholders' equity	5,646,538	4,272,573
Noncontrolling interest	105,619	193,010
Total stockholders' equity	5,752,157	4,465,583
Total liabilities and stockholders' equity	$8,936,980	$6,936,831

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
Share data in Thousands	Sep. 30, 2009	Dec. 31, 2008
Preferred stock, par value	0.001	0.001
Preferred stock, shares authorized	5,000	5,000
Preferred stock, outstanding	0	0
Common stock, par value	0.001	0.001
Common stock, shares authorized	2,800,000	2,800,000
Common stock, shares issued	901,816	909,819
Common stock, shares outstanding	901,816	909,819

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Thousands, except Per Share data	3 Months Ended Sep. 30, 2009	3 Months Ended Sep. 30, 2008	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Revenues:
Product sales	$1,648,955	$1,338,502	$4,664,913	$3,697,024
Royalty revenues	142,133	25,161	269,070	185,221
Contract and other revenues	10,301	7,605	45,021	25,300
Total revenues	1,801,389	1,371,268	4,979,004	3,907,545
Costs and expenses:
Cost of goods sold	409,700	300,183	1,122,159	805,715
Research and development	269,856	188,062	700,273	519,905
Selling, general and administrative	227,427	189,189	692,789	603,679
Purchased in-process research and development	0	0	0	10,851
Total costs and expenses	906,983	677,434	2,515,221	1,940,150
Income from operations	894,406	693,834	2,463,783	1,967,395
Interest and other income, net	14,017	3,637	31,098	40,363
Interest expense	(17,217)	(16,382)	(52,372)	(48,811)
Income before provision for income taxes	891,206	681,089	2,442,509	1,958,947
Provision for income taxes	220,728	187,396	616,310	546,206
Net income	670,478	493,693	1,826,199	1,412,741
Net loss attributable to noncontrolling interest	2,555	2,160	7,344	6,195
Net income attributable to Gilead	$673,033	$495,853	$1,833,543	$1,418,936
Net income per share attributable to Gilead common stockholders-basic	0.75	0.54	2.02	1.54
Shares used in per share calculation-basic	903,319	920,807	906,213	923,894
Net income per share attributable to Gilead common stockholders-diluted	0.72	0.52	1.96	1.47
Shares used in per share calculation-diluted	932,424	960,585	936,530	964,267

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Thousands	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Operating Activities:
Net income	$1,826,199	$1,412,741
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	44,312	37,548
Amortization	104,522	77,669
Purchased in-process research and development expense	0	10,851
Stock-based compensation expenses	138,860	114,605
Excess tax benefits from stock-based compensation	(59,268)	(155,723)
Tax benefits from employee stock plans	66,243	169,328
Deferred income taxes	11,339	18,498
Other non-cash transactions	46,015	9,912
Changes in operating assets and liabilities:
Accounts receivable, net	(290,013)	(259,086)
Inventories	(40,020)	(298,382)
Prepaid expenses and other assets	(33,356)	(22,275)
Accounts payable	135,212	341,462
Income taxes payable	118,621	8,884
Accrued liabilities	79,327	94,770
Deferred revenues	(23,215)	4,295
Net cash provided by operating activities	2,124,778	1,565,097
Investing Activities:
Purchases of marketable securities	(1,916,498)	(2,251,247)
Proceeds from sales of marketable securities	1,186,319	1,749,029
Proceeds from maturities of marketable securities	362,849	169,020
Acquisition of CV Therapeutics, net of cash acquired	(1,247,816)	0
Acquisition of assets from Navitas	0	(10,851)
Capital expenditures and other	(203,070)	(73,345)
Net cash used in investing activities	(1,818,216)	(417,394)
Financing Activities:
Proceeds from issuances of common stock	160,924	176,416
Proceeds from credit facility	400,000	0
Repayments of credit facility	(200,000)	0
Repurchases of common stock	(756,491)	(1,216,068)
Extinguishment of long-term debt	(305,406)	0
Repayments of other long-term obligations	(5,607)	(3,749)
Excess tax benefits from stock-based compensation	59,268	155,723
Distributions to noncontrolling interest	(80,047)	(6,468)
Net cash used in financing activities	(727,359)	(894,146)
Effect of exchange rate changes on cash	(13,906)	(12,219)
Net change in cash and cash equivalents	(434,703)	241,338
Cash and cash equivalents at beginning of period	1,459,302	968,086
Cash and cash equivalents at end of period	$1,024,599	$1,209,424

1. SUMMARY OF SIGNIFICANT ACCOU

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. The financial statements include all adjustments (consisting only of normal recurring adjustments) that the management of Gilead Sciences, Inc. (Gilead, we or our) believes are necessary for a fair presentation of the periods presented. These interim financial results are not necessarily indicative of results expected for the full fiscal year or for any subsequent interim period. The preparation of these Condensed Consolidated Financial Statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures. On an ongoing basis, management evaluates its estimates, including critical accounting policies and estimates related to revenue recognition, allowance for doubtful accounts, prepaid royalties, intangible assets, clinical trial accruals, our tax provision and stock-based compensation. We base our estimates on historical experience and on various other market specific and other relevant assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ significantly from these estimates. The accompanying Condensed Consolidated Financial Statements include the accounts of Gilead, our wholly-owned subsidiaries and our joint ventures with Bristol-Myers Squibb Company (BMS), for which we are the primary beneficiary as determined under the Consolidation Topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC). We record a noncontrolling interest in our Condensed Consolidated Financial Statements to reflect BMSs interest in the joint ventures. Significant intercompany transactions have been eliminated. The Condensed Consolidated Financial Statements include the operating results of companies acquired by us from the date of each acquisition for the applicable reporting periods. The accompanying Condensed Consolidated Financial Statements and related financial information should be read in conjunction with the audited Consolidated Financial Statements and the related notes thereto for the year ended December31, 2008, included in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (SEC). The condensed consolidated balance sheet at December31, 2008 has been derived from audited consolidated financial statements at that date. Certain prior year amounts have been revised for the retrospective application of certain guidance in the Debt Topic and Consolidation Topic of the FASB ASC, as discussed below. FASB Accounting Standards Codification In June2009, the FASB issued Statement of Financial Accounting Standards (SFAS) No.168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles (GAAP

2. FAIR VALUE

2. FAIR VALUE
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
2. FAIR VALUE	2. FAIR VALUE In April 2009, the FASB issued guidance in the Financial Instruments Topic of the FASB ASC which extends the disclosure requirements regarding the fair value of financial instruments to interim financial statements. This guidance is effective for interim periods ending after June15, 2009, with early adoption permitted for periods ending after March15, 2009. On April1, 2009, we adopted the provisions of this guidance on a prospective basis for our financial instruments. Our financial instruments consist principally of cash and cash equivalents, marketable securities, accounts receivable, foreign currency exchange forward and option contracts, accounts payable and long-term debt. Cash and cash equivalents, marketable securities and foreign currency exchange contracts that hedge accounts receivable and forecasted sales are reported at their respective fair values on our Condensed Consolidated Balance Sheets. The carrying value and fair value of the Notes were $1.14 billion and $1.67 billion, respectively, as of September30, 2009. The fair value of the Notes was measured using Level 2 inputs. The remaining financial instruments are reported on our Condensed Consolidated Balance Sheets at amounts that approximate current fair values. In September 2006, the FASB issued guidance in the Fair Value Topic of the FASB ASC that defines fair value, establishes a framework for measuring fair value and expands the disclosure requirements regarding fair value measurements. This guidance is effective for fiscal years beginning after November15, 2007 for financial assets and liabilities as well as for non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis in the financial statements and is effective for fiscal years beginning after November15, 2008 for all other non-financial assets and liabilities. On January1, 2008, we adopted the provisions of this guidance on a prospective basis for our financial assets and liabilities as well as for non-financial assets and liabilities that are recognized or disclosed at fair value on a recurring basis, and on January1, 2009, we adopted the provisions of this guidance on a prospective basis for our non-financial assets and liabilities that are not recognized or disclosed at fair value on a recurring basis. The adoption of the guidance had no effect on our consolidated net income for the three and nine months ended September30, 2009. The fair value guidance in the FASB ASC requires that we determine the fair value of financial and non-financial assets and liabilities using the fair value hierarchy established in the guidance and describes three levels of inputs that may be used to measure fair value, as follows: Level 1 inputs which include quoted prices in active markets for identical assets or liabilities; Level 2 inputs which include observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full ter

3. AVAILABLE-FOR-SALE SECURITIE

3. AVAILABLE-FOR-SALE SECURITIES
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
3. AVAILABLE-FOR-SALE SECURITIES	3. AVAILABLE-FOR-SALE SECURITIES In April 2009, the FASB issued guidance in the InvestmentsDebt and Equity Securities Topic of the FASB ASC which addresses the recognition and presentation of other-than-temporary impairments, provides some new disclosure requirements as well as extends certain annual disclosure requirements to interim periods. This guidance is effective for interim periods and fiscal years ending after June15, 2009, with early adoption permitted for periods ending after March15, 2009. On April1, 2009, we adopted the provisions of this guidance on a prospective basis for our available-for-sale securities. The following table is a summary of available-for-sale debt and equity securities recorded in cash equivalents or marketable securities in our Condensed Consolidated Balance Sheets. Estimated fair values of available-for-sale securities are generally based on prices obtained from commercial pricing services (in thousands): Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value September30, 2009 Debt securities: U.S. treasury securities $ 376,177 $ 1,683 $ (4 ) $ 377,856 U.S. government sponsored entity debt securities 818,921 10,533 (43 ) 829,411 Municipal debt securities 291,872 3,761 (36 ) 295,597 Corporate debt securities 676,086 12,085 (38 ) 688,133 Residential mortgage-backed securities 105,929 2,134 (148 ) 107,915 Student loan-backed securities 116,550 (13,152 ) 103,398 Other debt securities 60,569 911 (51 ) 61,429 Total debt securities 2,446,104 31,107 (13,472 ) 2,463,739 Equity securities 1,450 335 1,785 Total $ 2,447,554 $ 31,442 $ (13,472 ) $ 2,465,524 December31, 2008 Debt securities: U.S. treasury securities $ 199,962 $ 2,281 $ $ 202,243 U.S. government sponsored entity debt securities 669,721 12,105 (52 ) 681,774 Municipal debt securities 328,776 3,987 (126 ) 332,637 Corporate debt securities 450,567 2,146 (1,983 ) 450,730 Residential mortgage-backed securities 134,409 926 (574 ) 134,761 Student loan-backed securities 122,400 (20,602 ) 101,798 Other debt securities 58,468 735 (1,221 ) 57,982 Total debt securities 1,964,303 22,180 (24,558 ) 1,961,925 Equity securities 1,451 (692 ) 759 Total $ 1,965,754 $ 22,180 $ (25,250 ) $ 1,962,684 As of September30, 2009 and December31, 2008, other debt securities consisted primarily of foreign government and agency securities as well as other asset-backed securities. The following table summarizes the classification of the available-for-sale debt a

4. DERIVATIVE FINANCIAL INSTRUM

4. DERIVATIVE FINANCIAL INSTRUMENTS
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
4. DERIVATIVE FINANCIAL INSTRUMENTS	4. DERIVATIVE FINANCIAL INSTRUMENTS In March 2008, the FASB issued guidance in the Derivatives and Hedging Topic of the FASB ASC to improve financial reporting of derivative instruments and hedging activities by requiring enhanced qualitative and quantitative disclosures to enable financial statement users to better understand the effects of derivatives and hedging on an entitys financial position, financial performance and cash flows in the context of an entitys risk exposures. This guidance is effective for interim periods and fiscal years beginning after November15, 2008.On January1, 2009, we adopted the provisions of this guidance on a prospective basis for our derivative instruments. We operate in foreign countries, which exposes us to market risk associated with foreign currency exchange rate fluctuations between the U.S. dollar and various foreign currencies, the most significant of which is the Euro. In order to manage the risk related to changes in foreign currency exchange rates, we hedge certain of our foreign currency exposures related to outstanding monetary assets and liabilities and forecasted product sales with foreign currency exchange forward contracts and foreign currency exchange option contracts. In general, the market risks of our foreign currency exchange contracts are offset by corresponding gains and losses on the transactions being hedged. Our exposure to credit risk from these contracts is a function of changes in interest and currency exchange rates and, therefore, varies over time. We limit the risk that counterparties to these contracts may be unable to perform by transacting only with major banks, all of which we monitor closely in the context of current market conditions. We also limit risk of loss by entering into contracts that provide for net settlement at maturity. Therefore, our overall risk of loss in the event of a counterparty default is limited to the amount of any unrecognized gains on outstanding contracts (i.e., those contracts that have a positive fair value) at the date of default. We do not enter into derivative financial contracts for trading purposes. We do not hedge our net investment in any of our foreign subsidiaries. We enter into foreign currency exchange contracts to hedge our market risk exposure associated with foreign currency exchange rate fluctuations for certain monetary assets and liabilities of our foreign subsidiaries that are denominated in a non-functional currency. As these derivative instruments are not designated as hedges under the Derivatives and Hedging Topic of the FASB ASC, we record the changes in the fair value of such instruments in interest and other income, net on our Condensed Consolidated Statements of Income. Foreign currency exchange contracts used to hedge forecasted product sales are designated as cash flow hedges under the Derivatives and Hedging Topic of the FASB ASC. These derivative instruments are employed to eliminate or minimize certain foreign currency exposures that can be confidently identified and quantified, all with maturities of 18 months or less. At the inception of a hedging relationship and on a quarterly basis, we assess hedge

5. ACQUISITION OF CV THERAPEUTI

5. ACQUISITION OF CV THERAPEUTICS, INC.
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
5. ACQUISITION OF CV THERAPEUTICS, INC.	5. ACQUISITION OF CV THERAPEUTICS, INC. In December 2007, the FASB issued guidance in the Business Combinations Topic of the FASB ASC which establishes principles and requirements for recognizing and measuring assets acquired, liabilities assumed and any noncontrolling interests in the acquiree in a business combination. This guidance also provides clarification for recognizing and measuring goodwill acquired in a business combination; requires purchased in-process research and development (IPRD) to be capitalized at fair value as intangible assets at the time of acquisition; requires acquisition-related expenses and restructuring costs to be recognized separately from the business combination; expands the definition of what constitutes a business; and requires the acquirer to disclose information that users may need to evaluate and understand the financial effect of the business combination. This guidance is effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December15, 2008. On January1, 2009, we adopted the provisions of this guidance on a prospective basis and applied it to our acquisition of CV Therapeutics, Inc. (CV Therapeutics) as discussed below. On April15, 2009, we acquired CV Therapeutics through a cash tender offer under the terms of an agreement and plan of merger entered into in March 2009. CV Therapeutics was a publicly held biopharmaceutical company based in Palo Alto, California, primarily focused on applying molecular cardiology to the discovery, development and commercialization of small molecule drugs for the treatment of cardiovascular diseases. CV Therapeutics had two marketed products, Ranexa for the treatment of chronic angina and Lexiscan injection for use as a pharmacologic stress agent in radionuclide myocardial perfusion imaging in patients unable to undergo adequate exercise stress. CV Therapeutics also had several product candidates in clinical development for the treatment of pulmonary and cardiovascular diseases. We believe the acquisition will provide us with an opportunity to further expand into the cardiovascular therapeutic area. The CV Therapeutics acquisition was accounted for as a business combination in accordance with the guidance in the Business Combinations Topic of the FASB ASC. The results of operations of CV Therapeutics since April15, 2009 have been included in our Condensed Consolidated Statement of Operations, and were not significant. The acquisition date was determined to be April15, 2009 as that is the date on which we acquired approximately 89% of the outstanding shares of common stock of CV Therapeutics and obtained effective control of the company. The acquisition was completed two days later on April17, 2009, at which time CV Therapeutics became a wholly-owned subsidiary. The aggregate consideration transferred to acquire CV Therapeutics was $1.39 billion, and consisted of cash paid for common stock and other equity instruments at or prior to closing of $1.38 billion and the fair value of vested stock options assumed of $15.7 million. In accordance with the acquisiti

6. ACQUISITION OF REAL ESTATE

6. ACQUISITION OF REAL ESTATE
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
6. ACQUISITION OF REAL ESTATE	6. ACQUISITION OF REAL ESTATE In January 2009, we completed the purchase of an officebuilding andapproximately 30 acres ofland located in Foster City, California, for an aggregate purchase price of $140.1 million. Based on the estimated relative fair values, the purchase price was allocated primarily to land of $71.6 million, building of $64.3 million, land improvements of $2.7 million and office furniture and equipment of $1.1 million.

7. INVENTORIES

7. INVENTORIES
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
7. INVENTORIES	7. INVENTORIES Inventories are summarized as follows (in thousands): September30, 2009 December31, 2008 Raw materials $ 402,161 $ 505,106 Work in process 256,583 140,333 Finished goods 359,083 282,429 Total inventories $ 1,017,827 $ 927,868 As of September30, 2009 and December31, 2008, the joint ventures formed by Gilead and BMS, which are included in our Condensed Consolidated Financial Statements, held $660.8 million and $607.7 million in inventory, respectively, of efavirenz active pharmaceutical ingredient purchased from BMS at BMSs estimated net selling price of efavirenz.

8. GOODWILL AND OTHER INTANGIBL

8. GOODWILL AND OTHER INTANGIBLE ASSETS
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
8. GOODWILL AND OTHER INTANGIBLE ASSETS	8. GOODWILL AND OTHER INTANGIBLE ASSETS The following table summarizes the changes in the carrying amount of goodwill (in thousands): Balance at December31, 2008 $ 120,648 Goodwill resulting from the acquisition of CV Therapeutics 316,818 Balance at September30, 2009 $ 437,466 The following table summarizes our finite-lived intangible assets (in thousands): September30, 2009 December31, 2008 GrossCarrying Amount Accumulated Amortization GrossCarrying Amount Accumulated Amortization Intangible assetRanexa $ 688,400 $ 14,164 $ $ Intangible assetLexiscan 262,800 11,799 Other 22,095 9,296 8,942 6,582 Total $ 973,295 $ 35,259 $ 8,942 $ 6,582 Amortization expense related to intangible assets was $15.2 million and $28.7 million for the three and nine months ended September30, 2009, respectively, and was recorded primarily in cost of goods sold in our Condensed Consolidated Statements of Income. Amortization expense related to intangible assets was $0.7 million and $2.1 million for the three and nine months ended September30, 2008, respectively, and was recorded primarily in SGA expenses in our Condensed Consolidated Statements of Income. As of September30, 2009, the estimated future amortization expense associated with our intangible assets for the remaining three months of 2009 and each of the five succeeding fiscal years are as follows (in thousands): Fiscal Year 2009 (remaining three months) $ 14,718 2010 68,546 2011 77,626 2012 86,375 2013 92,883 2014 97,351 Total $ 437,499 As of September30, 2009 we had indefinite-lived intangible assets of $180.1 million related to purchased IPRD from our acquisition of CV Therapeutics.

9. COLLABORATIVE ARRANGEMENTS

9. COLLABORATIVE ARRANGEMENTS
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
9. COLLABORATIVE ARRANGEMENTS	9. COLLABORATIVE ARRANGEMENTS As a result of entering into strategic collaborations from time to time, we may hold investments in non-public companies. We review our interests inour investee companies for consolidation and/or appropriate disclosure based on the guidance in the Consolidation Topic of the FASB ASC. As of September30, 2009, we determined that certain of our investee companies are variable interest entities; however, other than with respect to our joint ventures with BMS, we are not the primary beneficiary and therefore do not consolidate these investees. Bristol-Myers Squibb Company North America In December 2004, we entered into a collaboration with BMS in the United States to develop and commercialize a single tablet regimen containing our Truvada and BMSs Sustiva (efavirenz), which we sell as Atripla. The collaboration is structured as a joint venture and operates as a limited liability company named Bristol-Myers Squibb Gilead Sciences, LLC, which we consolidate. The ownership interests of the joint venture and thus the sharing of product revenue and costs reflect the respective economic interests of BMS and us and are based on the proportions of the net selling price of Atripla attributable to efavirenz and Truvada. Since the net selling price for Truvada may change over time relative to the net selling price of efavirenz, both BMSs and our respective economic interests in the joint venture may vary annually. We share marketing and sales efforts with BMS and both parties are obligated to provide equivalent sales force efforts for a minimum number of years. We are responsible for accounting, financial reporting, tax reporting and product distribution for the joint venture. Both parties provide their respective bulk active pharmaceutical ingredients to the joint venture at their approximate market values. In July 2006, the joint venture received approval from the FDA to sell Atripla in the United States. In September2006, we and BMS amended the joint ventures collaboration agreement to allow the joint venture to sell Atripla into Canada and in October 2007, the joint venture received approval from Health Canada to sell Atripla in Canada. As of September30, 2009 and December31, 2008, the joint venture held efavirenz active pharmaceutical ingredient which it purchased from BMS at BMSs estimated net selling price of efavirenz in the U.S. market. These amounts are included in inventories on our Consolidated Balance Sheets. As of September30, 2009 and December31, 2008, total assets held by the joint venture were $1.28 billion and $1.07 billion, respectively, and consisted primarily of cash and cash equivalents, accounts receivable (including intercompany receivables with Gilead) and inventories. As of September30, 2009 and December31, 2008, total liabilities held by the joint venture were $996.9 million and $548.0 million, respectively, and consisted primarily of accounts payable (including intercompany payables with Gilead) and other accrued expenses. These asset and liability amounts do not reflect the impact of intercompany eliminations that are included in the Condensed Consolidated Balance Sheets. Although we

10. CREDIT FACILITY

10. CREDIT FACILITY
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
10. CREDIT FACILITY	10. CREDIT FACILITY Under our amended and restated credit agreement, we, along with our wholly-owned subsidiary, Gilead Biopharmaceutics Ireland Corporation, may borrow up to an aggregate of $1.25 billion in revolving credit loans. The credit agreement also includes a sub-facility for swing-line loans and letters of credit. Loans under the credit agreement bear interest at an interest rate of either LIBOR plus a margin ranging from 0.20 percent to 0.32 percent or the base rate, as defined in the credit agreement. In April 2009, in connection with the acquisition of CV Therapeutics, we borrowed $400.0 million under the credit agreement to partially fund the acquisition. As of September30, 2009, we have repaid $200.0 million under this credit agreement and expect to repay the remaining $200.0 million in the fourth quarter of 2009 using cash flow generated from operations. The credit agreement will terminate and all amounts owing thereunder shall be due and payable on December17, 2012. We may reduce the commitments and may prepay loans under the credit agreement in whole or in part at any time without penalty, subject to certain conditions. As of September30, 2009, we had letters of credit outstanding under this credit facility of $3.8 million, and the amount available under the credit facility was approximately $1.05 billion. We are required to comply with certain covenants under this credit facility and as of September30, 2009, we were in compliance with all such covenants.

11. COMMITMENTS AND CONTINGENCI

11. COMMITMENTS AND CONTINGENCIES
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
11. COMMITMENTS AND CONTINGENCIES	11. COMMITMENTS AND CONTINGENCIES Legal Proceedings On May12, 2006, the United States District Court for the Northern District of California executed orders dismissing in its entirety and with prejudice the fourth consolidated amended complaint associated with a putative class action lawsuit against the Company and six current and former executivesour Chairman and Chief Executive Officer; President and Chief Operating Officer; former Executive Vice President of Operations; Executive Vice President of Research and Development and Chief Scientific Officer; Senior Vice President of Manufacturing; and Senior Vice President of Researchalleging that the defendants violated federal securities laws, specifically Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated by the SEC, by making certain alleged false and misleading statements. The plaintiffs appealed the dismissal. On August11, 2008, the United States Court of Appeals for the Ninth Circuit reversed the district courts decision and remanded the case to the district court. On February6, 2009, we filed a petition for a writ of certiorari with the Supreme Court of the United States, requesting that the court review the judgment of the court of appeals. In April 2009, the Supreme Court denied the petition. The case continues before the district court. On February13, 2009, we filed a further motion to dismiss the fourth consolidated amended complaint on alternative grounds. On June3, 2009, the district court granted in part and denied in part our motion to dismiss and gave plaintiffs leave to amend the complaint. On July10, 2009, plaintiffs filed a fifth consolidated amended complaint. We filed a motion to dismiss the fifth consolidated amended complaint, which the district court heard on October9, 2009. In an order dated October13, 2009, the court granted in part and denied in part our motion to dismiss. With respect to the Section10(b) claim, the court denied the motion as to Gilead and two of the six individual defendants; the court granted the motion as to four of the individual defendants. As to the Section20(a) claim, the court denied the motion as to all of the individual defendants; therefore, all defendants remain in the case. The court has ordered the defendants to file an answer to the complaint and has scheduled a case management conference for January22, 2010. It is not possible to predict the outcome of this case, and as such, no amounts have been accrued related to the outcome of this case. On August12, 2009, we received a subpoena from the Office of the Inspector General of the U.S. Department of Health and Human Services requesting documents regarding the development, marketing and sales of Ranexa. We have been cooperating and will continue to cooperate with any related governmental inquiry. It is not possible to predict the outcome of this inquiry, and as such, no amounts have been accrued related to the outcome of this inquiry. We are also a party to various other legal actions that arose in the ordinary course of our business. We do not believe that any of these other legal actions will have a material adverse impac

12. STOCK-BASED COMPENSATION EX

12. STOCK-BASED COMPENSATION EXPENSES
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
12. STOCK-BASED COMPENSATION EXPENSES	12. STOCK-BASED COMPENSATION EXPENSES The following table summarizes the stock-based compensation expenses included in our Condensed Consolidated Statements of Income (in thousands): Three Months Ended September30, Nine Months Ended September30, 2009 2008 2009 2008 Cost of goods sold $ 2,461 $ 2,592 $ 8,486 $ 7,134 Research and development expenses 21,916 17,680 63,192 49,945 Selling, general and administrative expenses 24,230 21,322 72,255 57,526 Stock-based compensation expenses included in total costs and expenses 48,607 41,594 143,933 114,605 Income tax effect (12,389 ) (11,513 ) (37,466 ) (32,114 ) Stock-based compensation expenses included in net income $ 36,218 $ 30,081 $ 106,467 $ 82,491

13. STOCKHOLDERS' EQUITY

13. STOCKHOLDERS' EQUITY
	1/1/2009 - 9/30/2009 USD / shares
Notes to Financial Statements [Abstract]
13. STOCKHOLDERS' EQUITY	13. STOCKHOLDERS EQUITY Stock Option Plan In May 2009, our stockholders approved an amendment to the Gilead Sciences, Inc. 2004 Equity Incentive Plan (2004 Plan) to increase the number of shares authorized for issuance under the 2004 Plan by 20,000,000 shares of our common stock. As of September30, 2009, there were 56,290,640 shares authorized and available for future grant under the 2004 Plan. In connection with the acquisition of CV Therapeutics, we assumed CV Therapeutics 1994 Equity Incentive Plan, as amended and restated, Non-Employee Directors Stock Option Plan, as amended and restated, 2000 Equity Incentive Plan, as amended and restated, 2000 Nonstatutory Incentive Plan, as amended and restated and 2004 Employee Commencement Incentive Plan, as amended and restated (collectively, the CV Therapeutics Plans). The majority of options that were issued and outstanding under the CV Therapeutics Plans as of April15, 2009 were converted into options to purchase approximately 1.8million shares of our common stock and remain subject to their original terms and conditions. There are no shares available for future grant under the CV Therapeutics Plans. Stock Repurchase Programs In October 2008, we entered into an accelerated share repurchase agreement with a financial institution to repurchase $750.0 million of our common stock on an accelerated basis. This accelerated share repurchase was part of the $3.00 billion stock repurchase program authorized by our board of directors (Board) in October 2007. Under the terms of the accelerated share repurchase agreement, we paid $750.0 million to settle the initial purchase transaction and received 14,874,519 shares of our common stock at an initial price of $50.42 per share. In March 2009, upon termination of the agreement and in accordance with the share delivery provisions of the agreement, we received an additional 1,356,337 shares of our common stock based on the average of the daily volume weighted-average prices of our common stock during a specified period less a predetermined discount per share. As a result, the total number of shares repurchased and retired under this accelerated share repurchase agreement was 16,230,856 shares at an average purchase price of $46.21 per share. During the three and nine months ended September30, 2009, in addition to the additional shares that we received under the terms of the accelerated share repurchase transaction completed in March 2009, we repurchased and retired 6,220,000 and 16,546,133 shares, respectively, of our common stock at an average purchase price of $46.32 and $45.70 per share, respectively, for an aggregate purchase price of $288.1 million and $756.2 million, respectively, through open market transactions. As of September30, 2009, the remaining authorized amount of stock repurchases that may be made under our $3.00 billion Board-authorized stock repurchase program which expires in December 2010 was $241.9 million. We use the par value method of accounting for our stock repurchases. Under the par value method, common stock is first charged with the par value of the shares involved. The excess of the cost of shares acquired over

14. SEGMENT INFORMATION

14. SEGMENT INFORMATION
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
14. SEGMENT INFORMATION	14. SEGMENT INFORMATION We operate in one business segment, which primarily focuses on the development and commercialization of human therapeutics for life threatening diseases. All products are included in one segment because our major products, Truvada, Atripla, Viread, Hepsera, Emtriva and AmBisome, which together accounted for substantially all of our total product sales for the three and nine months ended September30, 2009 and 2008, have similar economic and other characteristics, including the nature of the products and production processes, type of customers, distribution methods and regulatory environment. Product sales consisted of the following (in thousands): Three Months Ended September30, Nine Months Ended September30, 2009 2008 2009 2008 Antiviral products: Truvada $ 620,564 $ 549,101 $ 1,818,996 $ 1,544,635 Atripla 605,299 427,623 1,684,324 1,106,941 Viread 169,711 155,958 489,241 459,306 Hepsera 67,928 91,217 207,716 264,604 Emtriva 6,729 7,634 21,001 24,111 Total antiviral products 1,470,231 1,231,533 4,221,278 3,399,597 AmBisome 77,064 72,884 214,645 213,680 Letairis 48,073 31,656 131,781 76,679 Ranexa 49,005 85,070 Other 4,582 2,429 12,139 7,068 Total product sales $ 1,648,955 $ 1,338,502 $ 4,664,913 $ 3,697,024 The following table summarizes total revenues from external customers and collaboration partners by geographic region (in thousands). Product sales and product related contract revenues are attributed to countries based on ship-to location. Royalty and non-product related contract revenues are attributed to countries based on the location of the collaboration partner. Three Months Ended September30, Nine Months Ended September30, 2009 2008 2009 2008 United States $ 918,477 $ 750,288 $ 2,592,910 $ 2,101,134 Outside of the United States: France 121,393 105,087 326,692 294,932 Spain 111,305 91,348 318,917 259,778 United Kingdom 99,663 81,028 283,893 217,180 Italy 79,235 64,946 239,434 209,171 Switzerland 127,763 18,151 237,354 167,071 Germany 70,092 71,429 207,249 175,013 Other European countries 137,004 98,139 416,469 214,397 Other countries 136,457 90,852 356,086 268,869 Total revenues outside of the United States 882,912 620,980 2,386,094 1,806,411 Total revenues $ 1,801,389 $ 1,371,268 $ 4,979,004 $ 3,907,545 The following table summarizes revenues from each of our customers who individually accounted for 10% or more of our total revenues (as a % of total revenues): ThreeMon

15. INCOME TAXES

15. INCOME TAXES
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
15. INCOME TAXES	15. INCOME TAXES Our income tax rate of 24.8% and 25.2% for the three and nine months ended September30, 2009, respectively, differed from the U.S. federal statutory rate of 35% due primarily to tax credits, the resolution of certain tax positions with tax authorities and certain operating earnings from non-U.S subsidiaries that are considered indefinitely invested outside the United States, partially offset by state taxes. We do not provide for U.S. income taxes on undistributed earnings of our foreign operations that are intended to be permanently reinvested. In May 2009, we reached agreement with the Internal Revenue Service (IRS) on several issues related to the examinations of our federal income tax returns for 2003 and 2004. We also amended our California income tax returns for 2003 through 2007 based on the resolution of certain tax positions with the IRS. As a result, we reduced our unrecognized tax benefits by $30.5 million in 2009. As of September30, 2009, we believe it is reasonably possible that our unrecognized tax benefits will decrease by approximately $50 million in the next 12 months as we expect to have clarification from the IRS and other tax authorities around some of our uncertain tax positions. With respect to the remaining unrecognized tax benefits, we are currently unable to make a reasonable estimate as to the period of cash settlement, if any, with the respective tax authorities. We file federal, state and foreign income tax returns in many jurisdictions in the United States and abroad. For U.S. federal and California income tax purposes, the statute of limitations remains open for all years from inception due to our utilization of net operating losses relating to prior years. Our income tax returns are audited by federal, state and foreign tax authorities. We are currently under examination by the IRS for the 2005, 2006 and 2007 tax years and by various state and foreign jurisdictions. There are differing interpretations of tax laws and regulations, and as a result, significant disputes may arise with these tax authorities involving issues of the timing and amount of deductions and allocations of income among various tax jurisdictions. We periodically evaluate our exposures associated with our taxfiling positions. We record liabilities related to uncertain tax positions in accordance with the guidance in the Income Tax Topic of the FASB ASC. This guidance clarifies the accounting for uncertainty in income taxes recognized in an enterprises financial statements by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. We do not believe any such uncertain tax positions currently pending will have a material adverse effect on our Condensed Consolidated Financial Statements, although an adverse resolution of one or more of these uncertain tax positions in any period could have a material impact on the results of operations for that period.

16. SUBSEQUENT EVENTS

16. SUBSEQUENT EVENTS
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
16. SUBSEQUENT EVENTS	16. SUBSEQUENT EVENTS We evaluated all subsequent events that occurred after the balance sheet date through the date of filing these Condensed Consolidated Financial Statements on Form 10-Q with the SEC on November5, 2009. There were no subsequent events requiring recognition or disclosure in these financial statements.

Document Information

Document Information
	9 Months Ended Sep. 30, 2009 USD / shares
Document Information [Text Block]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2009-09-30

Entity Information

Entity Information (USD $)
	9 Months Ended Sep. 30, 2009	Oct. 30, 2009
Entity [Text Block]
Trading Symbol	GILD
Entity Registrant Name	GILEAD SCIENCES INC
Entity Central Index Key	0000882095
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		899,925,051