GILD - Earnings call transcript Q2 2020

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Second Quarter 2020 Gilead Sciences Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your host today, Mr. Douglas Maffei, Senior Director of Investor Relations. Please go ahead.

Douglas Maffei

Liz. you, Thank everyone. afternoon And good

call available Just Officer; call Chief and after with second and be a release The Chief slides we Officer; Head XXXX. of Relations Executive the Brainard, Area. Gilead be: closed Merdad Officer; results for Therapeutic Daniel today, website. are detailed earnings and Chief Also and will on Commercial on for SVP Virology Johanna Officer. available press issued Mercier, the Dickinson, the Q&A the Christi Andrew Executive Chief Investor The Kite; and section today's press Chief speakers Officer release market on and Financial will first quarter Medical Chairman and our half Parsey, Shaw, O'Day, of of Diana

release the over to and in now GAAP disclosure update understand Gilead, website. financial used control begin financial and on with A SEC risks underlying be statements to Non-GAAP performance. forward-looking company's the All forward-looking you of as the documents. non-GAAP on on any comments, be call The can with expectations let release found COVID-XX turn to be impact currently prepared operations, the including as will we such our the these are available and description condition statements are me pandemic no that results business, Before of remind plans making and risks will results and products, XXXX related statements. will of uncertainties we help from our Gilead's regards and and could statements. Gilead reconciliations use that projections the assumes corporate in and Dan. involve you beyond financial the actual provided materially assumptions, strategy, latest capital uncertainties are I obligation well forward-looking to information our the candidates, of measures cause to press earnings risks press guidance, of certain to all based business financial differ product which and Gilead these earnings to to

Daniel O'Day

today and thanking patients our with I'd Doug, We'll I'm perspectives. continue many future and our work remdesivir, responsibilities are call. those to each I’ll employees afternoon, to by you, everyone. time. with above to pleased today's team my across along beyond we this our worldwide, advancing at building go Those forward look helping to our like meet questions. start to partners, with supporting and the other some medicines have include responsibilities and to good Gillian of Thank our pipeline here therapies. of who answering during me an your off things cover overview, all start provide of that

the thing The is core the our from and impact navigated COVID-XX want share I some pandemic, first even business. market expected comment as of strength that we grown the early and impact We've of already we're HIV recovery seeing on of markets. continued to durability signs in

needs. with track We to growth their treatment drive our driven will growth are continue date have that still Like our and to always discovery and those TAVI therapies on focused People in treatment. and to with principles the on that priory standard in in HIV for we're HR&D future. our apply The conversion on innovative been HIV. Gilead leadership become confident has is HIV living meet needs long-term depend gold has the meeting and in our

ensure patients shape of suffering our medicine. role on fighting There's some use and in recently a details understanding The remdesivir. real broad pandemic benefit world like use data, area efforts to continues NIAID and also data. studies, SIMPLE the comparative our data, highlight data of in year across to tell the the to data from I'd real I that of second with the half of growing body want is compassionate access analysis a to the world beyond. that our the to second more clinical The and comment consistent in a clinical story remdesivir COVID-XX for our

pandemics. feel remdesivir price to time, we further with work clinical on development of help and the in time remdesivir many last continue to to that more our for full that discussed will remdesivir to the this patient We the at the any with treatment future, extend meet that can in we well the applies research responsibilities continues so value we and that our to weight remdesivir groups. set period. ensure access future donation investment we in below enable The prepare and responsibilities potentially it the us we provides As price following critical extensive

that clinical the Merdad will begun talk inhaled solution of such the trials we'll have using used intravenous setting, hospital. could formulation homes. also as work on about conduct in outside later. an the be development nursing outpatient program clinical the And We more

COVID-XX Government of the rise in remdesivir United U.S. real meet time million about the enough know, XXX you of until courses patients the receive requests, supply the As our of to we September, discussions when States, have agreed we've to following infections will U.S. global treatment end the demand. to significant expect

will all European we purchase patients for in infection. among and be member announced to Union allocation Commission yesterday, rates states. regarding other European allocated The reach will of be supply As decisions UK. will the the responsible with with an COVID-XX European to remdesivir of significant pleased remdesivir Commission countries they the remaining agreement centrally are where for

in see will as in significant We a supplies October increase expected.

and story. shaping third theme on I is The to growth we're touch want progress the Gilead's making

on serve two in is highest pipeline. And balance will order Pillar period acquired a and more this our moment. first innovation pillar, previously You the with you'll we accessing growth achievements progress quality already external on which short our assets our front durable important of time strategy in future business. as to development like a I've see may will this several innovation in on And our across internal drive potentially I'd website Johanna transformational compounds. today corporate both in pace slowed bit a the detail a made executing describe immuno-oncology the to that a investigational on chapter. well. highlight has time. is next three our we shared these in activities is The shape three year pillars during more Gilead's that slides the on down And Pillar strategy. by touched the not framework made outlining we recall our of to this progress relatively of our pandemic patients. core

immuno-oncology preclinical this year progress The through our complimentary to Our approaches goal. scientific towards goal view is These represents we've and and pipeline external deals a and our growth. and range by deals both immuno-oncology this with announced significant of clinical grow both long-term assets to advancing to expertise opportunities mid access and internal or bring provide efforts.

in want Before work key I as to that something briefly progress, company, of comments against hand area another I racial over detailed mention we responsibility the the our team the injustice. for to see the for

using their have employees listening are platform on as everyone in we for serve. global for our committed lasting committed as communities they've Gilead We families they, I long-term to The past various with that and that immediate carefully a and their a the will team have both is employees see what issue and the racial to to to week role. leadership impact and we spent black Gilead's passionately forums. share action play started that calls us to communities how experience injustice a

you hand off business Johanna. to related now performance. Johanna, me some will to our through who the Let the Over us of call to walk key details

Johanna Mercier

everyone. afternoon, good And Dan. Thanks,

remains Let by solid resilient. pandemic, me start saying the is despite anticipated the and impact that of our business

some in this recovery see had business. has play well an pandemic, challenge, U.S. that No our do And incident parts of of our progression once return in as confident one the confident we're also normal we're this to withstand but built past remain this signs the strength in business, of kind the will to partial can actually Asia. of core COVID-XX we out on the While quarter, parts impact stabilizes. of Europe, this predict and as of we

starting half HIV. QX business performance, for out with the the Turning specifics to of first in

of portfolio. HIV the to we drivers for decade. our total franchise those continues TAF-based next and goal geographies over and to of HIV hit regimens conversion the switch. both treatment be we remain U.S., continue on and strong naïve across year-end patient is strong markets XX% Biktarvy will a Our treatment and and June, in both focused stated In side our uptake company are regimen the important the now this innovation key treatment prevention EUX and In number global history the durable. at have one and other believe across to is

the at we achieved conversion June. our of Descovy XX% PrEP, XX% XX% For to end of goal with

segments. during year-on-year. in seeing choice down the and X% from patients payer from physicians due robust continue patients. option not also as June. and and new by Biktarvy for for and to quarter-over-quarter believe and PrEP government including on that was U.S. and share decline the markets, reduced and overall dynamics. their of both primarily demand gaining we're increasingly see treatment to visits where care switches in mix providers our preferred shift portfolio stocking people impacted recovery COVID impact Despite saw revenue, physicians HIV year-on-year, patient for as Europe. this, we saw overall quarter-over-quarter Biktarvy initiations Gilead’s to a The the We're saw are in Descovy we Biktarvy PrEP our The seeing of pandemic benefiting pandemic in initiate therapies quarter PrEP happened in QX, discontinuations the The to and We improving the commercial seeing overall wanting reduced on remained expected, gradual X%. March expected, demand with In to pandemic. during dynamics. was the U.S., churns unfavorable We're side our that the we by the due inventory to starting reversal therapy are related across their and across driven seeing and health onset as including treatment and fewer social Also

PrEP the during our core first recover inventory the year year of expect HIV versus have XXXX, and the we to year underlying view we going Sound into business, If business HIV dynamic for revenues Biktarvy the uptake associated we the half Descovy the this the pandemic. of quarter remainder The normalizes underscores conversion pandemic growth. the from the in comparing as see XXXX. we X% with with over business look confidence half and at robust our

XX% is So was QX now, HBV HBV, down our more QX from turn into acute business XXXX and which this from like an in we XX% business, if year. down

and quarter-over-quarter. XX% As down QX or both the we visits diagnosis delayed patient starts decrease starts. discussed naturally for HBV reduced call physician during U.S.

Similarly, XXXX. we HBV is US seeing as consistent up at overall Europe has points strong strong QX share and However, are which in held segments, well. across XX to share XX% from about

As return see we to the across Europe, XXXX. start we it's to year and many July into the similar June throughout other rest patients and of markets reopen, what saw will in likely

an higher patients, especially year, more in recovery to impacted As heavily by to treatment. this example which Italy, was patients, physicians in we and COVID saw their earlier as this June return of the risk started begin

expect Before growth make expanding I that recent HBV preparing of horizon range and excited XXXX. filgotinib excited in we're for we me the for the at also despite by a a as COVID to hit business, CHMP RA end part in with the one of launch be opinion. commercial to impact let approvals This you the the billion XXXX. are highlight pleased about end of the term China, We're RDL significant just of In served we're the volume foreign the received we globally, in to us Gilead positive close, months near team. also seeing of opportunities on basis which the coming as

meet We be this look more expertise mid-to-long-term, As the for highlighted where that our our the magrolimab, long-acting therapy for for at Magrolimab ASCO. MDS and share build could on clinical patients. will a on the on to lenacapavir market accelerating key and immuno-oncology. efforts see believe And a future needs. strong best in portfolio very HIV we HIV data will to moment. we Merdad potential recently to patient see lenacapavir, we're in the and progress role in compound a we potential play lastly, important

So end I let where me started.

heading of prevention optimistic second treatment fundamental is core year. remain demand and businesses Our HIV we're durable, half drivers our the the real, and of into the business

compound for we're patients want they and remdesivir. our demonstrated we We core opportunities set deliver who my it that from to this to a of by in have very our time and months, proud with an launch matter reinforces compelling continue first incredible both an of team. portfolio go patient be for have of focused to just thousands on HIV, more a to recently who seen business XX,XXX medicines, history turned can of continue driven journey. it to Gilead lastly, all company of me, over the in product I'm in to Merdad, And building investigational I and need a hundreds thank a colleagues our base as you. I've serving just career, our patients It's but of commitment part innovation.

Merdad Parsey

Johanna, with perspectives that grow progress on and you times. here good to despite afternoon, our be these everyone. Thanks, continues challenging excited share to pipeline some the I'm and of both and to

the that expansion seen, Dan driven you've referenced strategy As period this our pipeline by earlier. continued during

to as while remdesivir, the pipeline. the able and course diligently added remdesivir great an strides possible of important working managing responsibility the on Of is of also of as make across we're rest this story part

Let pipeline along I'd of with highlights quality you. that with level risk. where across We things. a key The assets like is development good. diversification phases in the the therapeutic and have for at now. the we to of our the the some development balance share different areas to see of of associated three We'd look turn those like me across That's

lenacapavir of including each We in readouts exciting our reflected course assets this our of areas in meetings magrolimab, includes data key the set build at other of in further data of that clinical remdesivir. continue and scientific This quarter. and to validate as during presentations some belief our therapeutic

for HIV, capsid to the potential by a the HIV, Let me our treatment III continued as promise acting HIV In on long in few to long continue Lenacapavir, strategic II, Phase study specific few, make investigational most our this we for a each and option. has progress prevention. share working trial agent, People regimens continues of of a treatment enroll injection, people with preferably for both areas. and gives The a from we to commitment The chapter inhibitor are potential if highlights to on the who HIV to living for data our next often forward pandemic, with achieve us or a and that acting look during show to that options, therapeutic be to can weekly component lenacapavir for six with in self tell subcutaneous living the options. months desirable oral that both either treatment-experienced to every highly the any it long-acting other have be administered. potential profile key of these people both and prevention. three

to remdesivir. the of generated all months over been that about profile lot turning the of data us inform six A have the Now remdesivir. past

hospital piece key for short. and is thing As to that One and across stands out the story. a like we step is that a take in I the recovery Dan as data, a these back highlight few out, time consistency patients the of pointed see the pieces

treatment Another We've published of can mortality those standard a for And now and is patients. drug at analysis that a with be appropriate the using comparative care [indiscernible]. benefit world is real demonstrate five-day finally the data of course data. compared of

you was that well. As at wait And XX benefit towards final XX know, data trend and day ID and as day from we a there now mortality trial the study.

formulations begin study new remdesivir to combinations commercially also including our and ways available effective. remdesivir, version of nebulizers. on uses expand to an utility other that We continue could the pursue be inhaled more We'll I how exploring of Phase

used a formulation of that, agent. remdesivir for In We're potential trials several a as supporting is of standard clinical inhalation formulation. being subcutaneous of combinations. the dry a exploring care feasibility back-bone those we're Beyond studies, each on and powder also working

played role, this couldn’t prouder proud really of has so are pandemic We worked hard. team and the I remdesivir in be the

team you today, is remainder, insights share Brainard, will and happy with Diana As who the virology to be our leads us additional during here she Q&A.

on filgotinib. Moving to

potential receive and on option Europe, of In for is opinion to JAK treatment indicates and methotrexate. new selective rheumatoid monotherapy as you like from has variety on appropriate combination CHMP rheumatoid regulators that to with positive for XXX inhibitor with both includes XXX recent I'd The severe with a a in use discussions to inflammatory patients diseases. We pleased arthritis. believe continue this and a suffering to the provide of arthritis. doses moderate to adults opinion we're the milligram update

reminder, a European As anticipates Europe. marketing Commission authorization a recommendation the to to scientific grant in

meeting been that an be PDUFA remains continue Advisory the informed We date Committee and ongoing to We've FDA. unchanged. with will dialogue the have there

Moving during advancing to portfolio immuno-oncology the accelerating and of on several efforts and key in build pipeline transactions. the half throughout the in with quarter, We to expertise our oncology. year first and our made our strides

internal we completed continue our the announced immuno-oncology compound to during us give currently as allows will pursue the at site multiple pipeline. all the Gilead excellent to being major and and antibody. of This Forty programs the the have will therapy Kite a successful high approval entire cancers. of that filgotinib the now development their data. options option with very our our for our and the bring approval across investing colleagues tractions to monoclonal science, our closing, clinical on the expands company of new during clinical the acquire we also The to everything the work us caution groundbreaking PD-X provided. with biomarkers, each production programs. more We're gives relapsed/refractory This now Arcus the us to and Arcus partnerships a congratulate at complement Shaw, [indiscernible] the thoughts even MCL. first data we've excited these benefit more in the are for Kite Christi compound And to team. today milestones cell existing oncology. recent Christi in Pionyr with of pipeline summary as end-to-end clinical Yescarta partnership as partners. milestone Materials well differentiated transactions, These senior work team Tizona is therapy, experienced we approved Arcus of here other share inflammation ability that targeting more the In June are have Seven team developed on team Q&A. for products to approaches. with patients. signs. operations, company and the for that that NCCN the internal as us excited of partnership, in in build acquisition Kite happy the investigational deals and the these brings our and to of First, into cell pipeline This with core and for manufacturing We're treat both on We've pipeline. In which clinical well ability team of also a continues difficult-to-treat XX build launch quarter. upcoming a tail that reached leaders first brings provides based we much have portfolio impressive addition important patients major our about shared the also partnership to pharmacology, R&D potentially management, with

All and of us. join these to leaders excited have team, bring added them already world-class to an expertise we're

me Let to now turn over Andy. call the

Andrew Dickinson

before like our to afternoon, three Merdad, Thanks, round cover Q&A. good everyone. commentary and topics to I'd turning to out

summary financial highlights a of half provide our XXXX. quarter for the and the I'll first of First,

outside of updated on second drawn external implications thinking. on provide experts of additional half the potential COVID will XXXX on color assumptions some I based the and Second, from

pull to guidance. this I'd our all and together revised XXXX review Finally, like financial

of a the materials details our posted reminder, XXXX including revised guidance. information, additional on As earnings website contain financial our the

share billion were our highlights. second to quarter for earnings now non-GAAP per financial Total $X.XX. revenues the Turning of with $X.X diluted

the of quarter This Product a a period revenue and on share Forty a As of earnings the down per $X.XX basis, year-over-year. primarily $X.X GAAP Seven. to billion, to charge second down same research the in-process share of non-GAAP X% $X.X noted we compares related with loss recorded billion earnings $X.X development were acquisition last in to due sales XX% diluted sequentially our and billion per year. for release diluted $X.XX, of for press

in was The anticipated, approximately impacted were million HIV by second United product second HCV of unfavorably growth quarter States. rebates, COVID-XX. recorded to of year-over-year favorable primarily As in also quarterly the statutory for revenues in This the prior Europe. was HIV impacted XXXX year partially offset decline driven and decline sales the by adjustments by by $XXX quarter Biktarvy

volume lower HIV seasonable offset year-over-year, As starts the revenues Europe. and decrease the U.S. by net in decrease of patient U.S. year-over-year payer billion sequentially quarter-over-quarter was primarily first and demand lower sales growth the in and diagnoses price patient partially product sequentially $XX.X the the driven U.S. mix. Sequentially, was The driven to pandemic. higher the year decreases as in revenues by $XX.X treatment primarily Johanna due to primarily for pandemic to mentioned, Overall patterns in half HCV and QX lower uptake Yescarta the the as were for our the of patterns. XXXX. reflects continued due by reversal inventory billion and increased revenues due unfavorable the buying grew and PrEP to well compared

demonstrate LOE HIV are strong core reflects encouraging products compare recent normalized we HIV COVID-XX our first up our the dynamics X% grew results the in despite impact over COVID-XX. year impact a despite half in period demand first If the HIV Ranexa underlying XXXX. of versus the with strong business franchise and of we inventory to associated same XXXX, half and year-over-year our of time for the XXXX Excluding the start business pandemic. growth, and the This with Letairis, the

more posted. geographic information, the breakdown of have revenues including the in we You materials find can

up to previously expense positioned. and to expense Non-GAAP and billion, up sequentially, costs. including same turning liquidity remdesivir, primarily Justice period disclosed related to to X% Non-GAAP sequentially, From million expenses. $XX the a manufacturing we in the the R&D to to be our continue SG&A very year period X% to compared well a $X.X due investigation. $X.X Department was last XX% investment last compared standpoint, up trials clinical was a same due accrual billion XX% of and primarily quarter, Now for year up scale-up

billion operations, During repurchased billion XXX,XXX of net marketable the and we the acquisition acquired, stock shares cash quarter, cash of of billion, Seven we we quarter cash $XX dividends securities. our ended generated We million, debt $X.X paid quarter million. Forty for cash for of from we and and in in this $XX.X completed $XXX $X.X with

Our and strong are investment macroeconomic balance priorities unchanged. sheet allocation portfolio withstand like events built our capital COVID-XX, to remain

continue We expansion. external investment on of will to pipeline internal support focus innovation continued in augment and to

In dividend time, intend we from addition, to provided approval course, to Board. support and that grow over subject our our dividend of is, any increase

repurchase Finally, in February. we're in relates the earnings as quarter fourth and to in provided directional track on guidance it shares of call year-end XXXX XXXX, relative to our we

the Turning our now guidance. to impact revised on COVID-XX

as heard long-term and in earlier strong. the durability very outlook of Importantly, remains the call, our you fundamentals

gradually that impact business second recover switch we in quarter. peak dynamics observed in the starting expect We our treatment that QX, will initiations core pandemic following on underlying and

we patient HIV our on maintenance business over impact to high market and In third in regain expect minimal the with time quarter beyond. HCV, of expect to starts treatment share. continue We momentum

remdesivir, In we pricing established earnings addition, for our we have the expectation call, year. global first remdesivir our since have for for quarter refined and

revised availability and uncertainties expect, guidance. recovery full the let would context, are duration as year of year still shape With our remdesivir. as concerning second in well as you the the and there of me half of summarize the uptake of that many the details As the

is line expectations. our US$XX range, increasing SG&A in billion XXXX sales top of including We're billion. remdesivir XXXX to revised expected expense US$XX R&D revenue Our and

Our margin guidance product effective tax unchanged. XXXX rate on gross remained and expected for

points non-GAAP like more $X.XX highlight I'd a range Our to $X.XX. is drove that on color will billion. is billion updated range $XX.X you this give updated And operating our income to EPS $XX additional to few assumptions updated guidance. finally, the that

in as guidance On side, expect remdesivir, R&D that litigation expected remdesivir, expenses cumulatively manufacture mentioned and the the to Seven accrual expense previously treatment courses we've for I or to we increase earlier. million more Forty and X stated, reflect XXXX. SG&A On

expect X.X to reflects of guidance we year. to million sell courses remdesivir that treatment Our revenue X this million

the We the That the uptake of expect third beyond. that will of in increase demand towards proportion continue in pandemic, and said, economic fourth the potential progression skewed our uncertain. ex-U.S. that supply and dynamic the in to the be remdesivir remdesivir will be the backdrop sales global expectations, U.S. quarter related of matters and the quarter

coming you on expect call. we'll learn We more update over QX thinking our our on earnings to the latest and months,

off to I express the dedication and I'd XX,XXX Before their hand be nothing to call spirit, strive gratitude Gilead globally. like possible. patients as Without achieve Q&A, would well for my we employees for to our resilience,

for Now the Liz? call I'd questions. to like open

Operator

Tyler with [Operator Instructions] Our Van first question comes Buren from Sandler. Piper

is line Your now open.

Tyler Van Buren

about Hey, for HIV guys. and talked out pandemic, Thanks share of I the HCV pandemic coming to you respect during taking the the you with guess that question. the increases saw stronger.

you So could that? color just provide a more on little bit

Daniel O'Day

away right turn to I’ll Tyler. Johanna. Sure,

Johanna Mercier

Yes. Tyler. Thanks, Okay.

Biktarvy and treatment lead grew two example, prevention, think Descovy, share. brands our both when So for which you is and about HIV, in Biktarvy for

growing it's here year-on-year So been quarter-over-quarter. but even

– grew increase. X% you about So a share you on think then QX can for about were to in XX% when Biktarvy. and and QX then the end a And that's ended we appreciate, XX% Descovy, PrEP market quarter at so the up the basis, in about June about of we at think we you when closed at share And XX%. we large very

because of decrease patients. of and brands brands the I they think solid do offer because I support for patient some the their to are portfolio, with that what no is about and the the are cetera, the one think do because of rapid that's transition the think that no both of those think choice visits best actually Biktarvy COVID-XX So if And probably still really that are Biktarvy about of monitoring, throughout you Biktarvy you start for pandemic. dynamics environment because those things, this with for critical COVID-XX patients. helping of testing, of in brands in And despite I that patients screening, think some actually and et the also HLA that, are

Tyler Van Buren

switches? or that the follow-up. at With gains, a respect pandemic? they are gains the they is to as share from just share were – the Are the Are all? pandemic regimens to And taking they as coming change share Biktarvy quick different during prior those they're

Johanna Mercier

business the about same. the only guidelines seen don't in to obviously want what Yes, slower past the would treatment actually suggest we've switch switch there's than The drug. bit the I is is drug sourcing in no is little to difference our just switching because a during actually physicians of from pandemic that – say the

now are naive share. population So right versus that's Biktarvy keeping feeding more older patient switch compounds and the it's the population

about what Gilead since switching over keeping versus higher are you is Biktarvy. of HIV, like compounds then are within our share to newer has seeing XX% brands So basically older some

Tyler Van Buren

Great. the questions. for Thanks taking

Daniel O'Day

Tyler. Thanks,

Next question please.

Operator

question next comes comes from with from SVB Porges Our Leerink. Geoffrey

now line Your is open.

Geoffrey Porges

much. very you Thank

So, it questions you million sell on of X.X Andy, maybe remdesivir. a in QX. going you're to X.X million courses I supplying think courses, just X though sounds but million to indicated, couple as you're

upside your is beyond guidance? you've So you sense year? initiatives have you demand about secondly, is place some could the sense on given courses huge incorporated give just are there then those income. And must you a the the us that you that the capacity a for XXX,XXX an basis see your your allocated in what There of give be already in uncertainty into in how in us there's a of demand? capacity range you could how QX? Or And QX operating

give of But driven on you that's I kind us being more presume color So that? remdesivir. could by

Andrew Dickinson

and I'm Maybe Johanna. Oh, final with point ahead, I’ll sorry. go ask start Dan. Yes. one

Daniel O'Day

that’s great. you. Thank Perfect. No,

Andrew Dickinson

range, the on QX I’ll is expectations. remdesivir it by of Maybe the and wide driven QX. and upside our supply there to ask demand and is Johanna the The in – comment a

by week. We learning more recently. just mentioned started So we're week commercializing Johanna

So on the narrow thinking give Geoff, demand be you and do we'll on the want in our you supply touch update would third as expect able quarter, an that you Johanna, we to to – the do and base issue? expect.

Johanna Mercier

Sure. Yes. Sure.

was maybe specifically. saying to So add for what QX just Andy

an the up ramping in an just because Dan but incredible October, stable it's place it's this have somewhat, a through globally feel across if be place, supply some is we supply the to global should I wait that's been low, in should has because ramp the understanding know global demand, numbers, uncertainties uncertainties like pretty early within QX. not does around this thus in great We think We idea, that uncertainty that can't QX, pandemic more The is come does actually I a itself and done – job in we to – are a I we've the our that the be be of mentioned in don't and we and it team The know. has right word, the Europe? seen up, and challenging don't really are stabilize, really We assuming feel multiple, stability where and it you really all-time in. – far. not good we a been and situation by I see impressive. think ramp-up pandemic think meets less

so little why to bit that a it's And that's tougher front. on manage

position year, this the of X by before we a December end mentioned courses. treatment over of to from cumulatively a supply have of million As be should in standpoint

And some used are during obviously donation those, in being and used were some QX. the of

governments right that balance real-time the the is U.S. with think will all and need. of governments, just that's be not now but in we're play really the understand world the around focus their to what better for So and our need QX, just real-time they is, the different working

Geoffrey Porges

much. Okay. Thanks very

Daniel O'Day

you Geoff, and else in we'll and quarter three, obviously. update everybody

is So this best our stage. at estimate this

Geoffrey Porges

you. Thank Okay.

Daniel O'Day

you. Thank

Operator

with Our from Michael next question comes Jefferies. Yee

open. is Your line now

Michael Yee

Hey. Thanks. Good afternoon.

done comment of lot is former make actually some and you a it utilization. demand a around this One We've the utilization, could and you've two that be maybe actually Following done questions. sounds a stockpiling. actual like actually about math up about on can actual versus remdesivir, thinking sales

And inhaled. would you have question? That this forward comment injectable have fourth data? And data could dynamic. look Is say, just some bit, you little type even I Thanks. by, PK help and about this comments future do and just on maybe what this that then the So And would a challenges? you in of Phase made to just looking think you've the is second know What are about use? us quarter? a for

Daniel O'Day

go Sure. injectable. I’ll Merdad add you then to and and start, we'll the then Johanna,

government time, where sometimes of all, U.S. the we and they that's today frequently the really majority are a supply. more is think remdesivir process vast has that So first the really, of with better hotspots have and The I the over twice the are of majority used. allocating allocation being Michael, vast basically to States, month, in at the United least gotten the

So at utilized we stage. think not there's probably very little being demand that is this

some on patients. in might the right more in we're just with, and other a countries United not have course, right efficient, and of given now, remdesivir now. some there than variety demand completely that working tremendous the States, have hospitals But real-time Of working human need where really are pockets particular, we're the you it's

have to being else that's that. add want do anything utilized. you Johanna, you So to

Johanna Mercier

that there this, is to to with government, idle Michael, patients fact a on would just working Dan, understanding and sitting – just thank needs to are that somewhere. with ever the "no, the it around it do worst governments somebody I we in incidents. need, some Maybe, lot understanding U.S. with add a the you. that, products really incidents that governments really right we're managing need epidemiology. shortage to go in it's Everything working needs the that have is happen through also supply the of so it's could actually HHS, doing, now." together it to that coming is And think We the based said, I don't way on people Give to seen based who work thing it. add So Yes. ex-U.S. hospitals and that what are the as well, far we've world, because of it

careful in being make very, to So world. happen that very we're doesn't sure the anywhere

Daniel O'Day

Michael, October, demand Michael’s earliest stockpiling, utilization the different for would to perhaps we be start see to opportunity think over on question. perhaps you the before is and actual that Merdad, and I but October. not

Merdad Parsey

Yes. Yes.

So dose the being I phase. ahead in escalation in subcu. inhaled right as mentioned, now the mentioned, we're on The working what I I inhaled and, Phase as both say is, I'd in

the – Our patients, hypothesis the here primarily is in many especially that one. is in the early virus

version is to in a for the lung needs an so potentially question we whether narrowing get for an that where [indiscernible] or treat with benefit can and inhaled it the an or a be With outpatient even would patient, those And inpatient. have patients. inhaled a

we're to extent inhaled going with version. running So be that's the the

continue and we'll that at to online. work bringing on in currently clinic. subcutaneous, not as the far is feasibility mentioned, parameters That we're other that. As And looking as I of

Michael Yee

Thank you.

Daniel O'Day

Michael. Good, thanks.

Operator

Our Terence next Sachs. question from Flynn with Goldman comes

now Your line is open.

Terence Flynn

wondering, I on long-term the you capsid, the I quarter? just you a And financials, could thank and on taking as wondering, that from the then you for obviously, thanks you was first, quantify in opportunity COVID if the dollar guys. work important about think Hi, all for the basis saw to front. impact was on for the question try COVID you

conceptually, are of internally a the partner finding terms you future economics the you for a dominate to an And focused market Just in partner? for external continue that the looking you. on Thank open share? Or splitting as to market? to result, on are

Daniel O'Day

Great.

question. why take capsid financials, we'll and Andy the take you don’t the So have Diana

Andrew Dickinson

Terence. the Dan. Thanks question. Thanks, for hi, And Yes.

the specific impacted provide would hit say, business impact. guidance exactly don't it know, didn't we that – so As we I expected, in level, specific provide you our it predominantly. of a we at high in way COVID terms the a

Johanna the was impact and less the revenue HCV from our substantially As the than in billion in you top-line treatment PrEP on heard $X.X HIV half. business, first

think think a you've thinking Terence, heard of as of first companies given at first half pull end as inventory well, the quarter. from it's basis, Hopefully, on quarterly it helpful. than the that's rather to about the on I the about other basis So forward it easier

Diana Brainard

it's inhibitor of And been by meet on HIV our the with focusing our vision long-acting of to patients and at up franchise. needs the there, Great. speak where say our regimen. doing And what capsid I we driven come to looking can compounds agnostic is we're would and to really and our the trying of that I past success,

And there through excellence discovery. through partnerships, It's to discovery, we partner in we're so acquisitions. been through try And a and have work capsid. been do a our in for to the course, of doing and internal past, of that's lot really internal terms of been unparalleled find it's,

the with as will we the we for externally successful looking So best also regimen and always well that we patients. are idea if open be create

Daniel O'Day

for Terence Thanks, the question.

go the can next Okay, we one to please.

Operator

Abrahams question from next Our Brian with Capital Market. RBC comes

Your open. now line is

Brian Abrahams

Hi, very question. for Question on there. my filgotinib. much Thanks taking

FDA shapes the current and then the launch PDUFA or on positioning strategy. and the commercial differentiation curious, still JAK CHMP risk I'm And Do With reason and benefit recommendations the and approach global think the that if the product? that state profiles illustrative pandemic, wondering potential your there's dosing why for looking are indication. necessarily the how your differently? any be I'm of upcoming Wouldn't of Thanks. thoughts on you label through EMA for latest also at otherwise,

Johanna Mercier

Thanks. Maybe start... I can

Daniel O'Day

to ahead go please. you add Go don’t well. ahead, and why Yes. Johanna, wants’ anything start Merdad But as

Johanna Mercier

Thanks Okay. for the question.

working are world So around for filgotinib. yes, the obviously, with opinion, working to we've been we – and teams with diligently with positive pleased so the launch recent the CHMP prepare

And way But to kind not light the seeing of the couple dynamics we market, thinking a what situation. looking in virtual. assessing at months the COVID think are the honest of virtual, we're I the back, is – think of virtual I We situation, maybe in you, to with be go. were of where

do and looking And how best we so the we're approach. this at

to So this that what in more that talked filgotinib it's come differentiation with in on we sure make work the that a competitively lot From the to offers. as front, about a profile of differentiation before. do as on believe going We we've it possible. of standpoint, line and

on do And our medically want to that education you that make to sure the regulatory so opportunity medical teams, comment physicians. that to an happens piece? with therefore conversation, really that Merdad, that's

Daniel O'Day

is feed audio so here Brian. issue, Merdad think having a bit I'll of I an in

world. I the happen authorities kind think to different in what's regulatory of around it's exactly premature going anticipate to

Europe soon to know, as some And to additional out one as the We let continue have have that. pleased difficult with with gate. we'll Thanks. we was you obviously but the all authorities, speculate. regulatory first of discussions information, We're

Unidentified Analyst

Thank you.

Operator

Our with next question from comes Cantor Fitzgerald. Young Alethia

line Your now open. is

Alethia Young

of of to about been Hey just maybe guys, have some it's earlier here, you there's guess I have of you thanks my picture kind question. utility talk incredible. some And wanted big remdesivir, course, that taking like, on could in kind for positioning which the I congrats I that everything doing think couple you. at I'm remdesivir, ball. Even are cycle, we Thank over where with know of years? crystal well look asking and kind perhaps though of just as beyond the maybe next but about treatment to a how you things of the guys

Daniel O'Day

You're a very us. for Thank much you cheerleader great Alethia.

type control on position yes effective pandemic. of any you and certainly is always I a one vaccines to a effective So this general therapeutics will think, type outbreak and of in obviously, our that need viral any

to So to working I think firmly we're impact. expand remdesivir's committed

data And at terms consistent other our every it even or hands of hospitals consistent in about and will hands I space, that use bigger reduction in earlier consistent, people's of impacts. has regardless the been effect continue the hospital of space piece in pleased in really around ability to think vaccination. get We’re in

outside never will remdesivir so globe is always hundred in of it the go potency them reduce utilized, take appropriately Now could administered to our a hundred the are there also out vaccine we enter types normal having on the percent as patients effective, from influenza patients patients hospital patients have to that will to terms work earlier get the to now that therapeutics. many vaccines vaccine never need that remdesivir they an doing as the effective we're use hope the to a hospital. using And obviously that hospital the we're of of prevent ability you be the number the what excited you is But, in. to make around about faster. sure are And could know, of ever patients like percent with as ever that of have a

Of to be all determined. course that's

because antiviral we're combination and to be, my treatment really have with view to been colleagues possible, proven remdesivir to potent like be know to continues And in it this bring will other an be and obviously at stage also that's I around has think to vaccines. this going vaccines in us hand perhaps patients terms of remdesivir But the work even in they I are glove forward antiviral, effect. our proud with to and everything at So a patients. collaboration that we're that I'm that new in the to think, get working used, therapeutics with stronger doing in I on looking hoping, industry therapeutics be in including the looking industry,

we're excited so about And that.

you much very the thank question. So for

Operator

next question from JPMorgan. Our comes Cory Kasimov with

is Your open. line now

Unidentified Analyst

my question. thanks And this for is Cory. for guys, on taking Matthew Hey

pull So just as through factors other able XXXX? XQ to weakness was in go back which inventory and down to a such factors slow Biktarvy, to much are the you mentioned? versus these the we how of persist due quantify And patients, shift expect for to to of that is other in should remainder you mix payor

Daniel O'Day

Thanks. Over to you, Matthew. Johanna. Thanks,

Johanna Mercier

in and you the the it because little out it from a always Thanks Matthew bit uptake shift in in and it it the for but bit, really saw it driving And we their that's QX late driving we that to but QX. COVID-XX to the what's it's what's questions. saw appreciate up and If specific if inventory I understood I understood plays in the March bleeds a in shift was broke you out fluctuations, little correctly, QX it, sorry of can QX, QX, out higher, bleed QX. then Biktarvy

what's really the it's So piece. driving Biktarvy

to payers PHF last in a payer government a mix point not shift impacting Medicaid, time impacting overall. where due really the business shift or specifically in seen our seeing quarters, two that's commercial but we're have modestly We to unemployment this at and from channels,

So it's really inventory-driven.

Unidentified Analyst

Great. Thank you.

Johanna Mercier

your question. answered I Hopefully

Unidentified Analyst

Yes.

Johanna Mercier

Okay.

Operator

of with America. next comes Meacham Geoff question Our Bank from

is line open. now Your

Geoff Meacham

has I for for but Dan a Dan, strategic still get or stabilizing. sustainable narrative over as from hep you of C Hey was to question. a Andy. I when growth headwinds Gilead the And evasive. return course, one took COVID, for the the had thanks even guys, growth was been

mode, are other long-term your view the and as obviously or do do you like assets, growth need you filgo need is, to more long-term you you drive other you much. sustainable So Kite very new feel help assets in anchors that but product question recognize remdesivir also growth, that growth. Thank

Daniel O'Day

was about Geoff I sorry Yes, the chatting there. way that

the that to playing is our we have long-term certainly predictable latter with happy much that Let what a to say, by the where company. the growth relying And more is we as impact as We remdesivir not the way and in it's we're world, in But get role. we'll for a on that for crisis pandemic hopefully understand Jeff. the stage mid-to question, patients are, upon the is remdesivir. that can COVID that an completely me your

about business HIV we with on our only we the that that believe we generation next emphasis but with to with medicines today, lead core overall rather our outside Kite moving business, see And growing now you also outside then not sure what I our of what inflammation, Kite. tomorrow to think into So continue the have internal of make combined And virology, deeply of both more outside Kite. as oncology, of in think and continued moving particularly into pipeline. we immuno-oncology that's

more using to looking going Gilead done You on confident environment in much different and an hematologic innovation of has medicine like competitive of leadership a there's about ability both job of optimize on what at that half see, there we're goes in profiles, life first at sure indications think, our obviously are seen where making risk that's, do to about with I breadth current And right? fit-for-purpose allow in different to tumors. portfolio really we doing management going to different that to risk are of depth malignancies, to assets the you've team and solid Seven think quite bring of the a associated expense kind and continue to that magrolimab when and bringing best-in-class, where our development. of period deals BD of cycle a we're us think, we into and year, has it. that along feel where to after is trying first and the Andy's how at multiple also prudent of a us this like possibly or position look about leading where transformational stages in to allow data medicine others good house And with earlier late-stage over success stage targeted be we've And I that transactions, under smart, house deploy continue seen which capital Forty We're time. the bullish upfront for particularly pay in

So strategy you'd story. growth a that your our to anything of is build grounding Andy, fundamental and on long-term absolutely add us mid-to to type from side? like which to continuing

Andrew Dickinson

that I well, it. think it captures you said

Geoff Meacham

Dan. Thanks

Daniel O'Day

Jeff. Thanks,

Operator

next Seigerman comes with Our Evan Credit from question Suisse.

Your line is now open.

Evan Seigerman

and so have you should you I of us much June think May? the this better recent the for have Can versus reversal Thank month on this of for how year? we you trends over Tecartus. And the kind haven't very taking for question. understand commercial's congrats potential help approval the you in on I actually the used around seen asset? the spoken about you course say trajectory view or CAR-T And the of call know one much your how Christi.

Christi Shaw

wide making awake question, the sure I'm for and listening. Thanks

so being has about patients, deliver be pleased to lymphoma cell a first We’re the for that company able Tecartus intent. to curative mantle

it's continue us for other like really to although relative studies so, second leadership. coming is our And the not up opportunity a some of huge be a or marketplace line, that it differentiator in will demonstrate to to DLBCL our

like our we're footprint, up. manufacturing Yescarta, gearing Just with

the – ready We XX days. go new within product seven to in for have sites days, authorized a authorized

at slowdown of now have surprised we more that So we're on with what we And the nothing such to QX, something help that to would than hopeful When we we in terms alive, we actually maybe can say were continue the be, will QX that were what's based versus thought these in treated patients U.S. pleasantly have great states registrations. all else in them happening the what saw patients with very COVID. I say in happened that with efficacy. them see look of keep I'd that

growth. to get But So I to But come beat of hold too could cells out we’ll and really I right better. missed early a missed and can ATC all canceled we is to proud didn't team team, uplift imagine delivery. about having don't being if which haven't it's back and of figure some QX hopefully, not the before, huge as being of see I'm we Kite T now to to optimistic we're as early originate flights to T-cells with know you the do you not be lose this And and think because hasn't we a with on, situation and in maybe able flat where tell. out we the I'm where bring a going when QX, hasn't

look as we at it's Kite So the submitted. lymphoma indolent a opportunity, and of non-Hodgkin's, mantle year at time of short the period look the indications I Hodgkin's this cell in whole being very by lymphoma, really the of whole of end multiple with

indication And We second also priority be next review with to we next submitted big year have have and being year. ALL being DLBCL submitted line approved. the of

potentially it do at of and So cancer. combination, as growth patients I that gives cure opportunity to us the you their look for think best more

Evan Seigerman

much. you Thank so

Daniel O'Day

Kite develops. from we're hearing from business that and forward Christi to Evan. looking Thanks More Evan, more as to Thanks, hear you.

Operator

from next Morgan comes Our with Matthew Stanley. Harrison question

Your now line is open.

Matthew Harrison

about I just MANTA. a Thanks want question. evening. for Great, bit the ask more to taking little good filgotinib and

about like when So enrollment, point think, three you've end finished it it's there. either the sounds primary you I take months

how approval that end it the your towards year that getting two influences or versus come Thanks. ability those the and like for How of FDA data which timing it get just could to the So I'm application? data the timeline MANTA, wondering to of the this from work the how filgotinib. sounds

Daniel O'Day

over right thanks Matt it to turn we'll Merdad. Hey

Merdad Parsey

Hi Matthew its me. I Merdad. hope can hear everybody

disconnected got Sorry earlier. I

be I regards don't that – for both looking right all of going are duration be Matthew, in in some the at the to we don't you sufficient onset are regulators, will months the and that anticipate recovery. patients is So necessarily three terms the enrolled.

period, first three period, the critical be is we necessary. that's there's months probably longer So think while to blinded a that that's

at submit us the early to to for looking data next timelines we're this us in year next half then have probably year, and the at. year. the are looking late to we're first of it So in for Those kinds of the agency

Matthew Harrison

for Okay. your Thanks question. very much

Merdad Parsey

That’s question, it a you do or Matthew. thanks, have

Matthew Harrison

no, that's Thanks Dan. Yes, it.

Daniel O'Day

Thanks.

please. Next

Operator

next comes Robyn with Our from Karnauskas SunTrust. question

Your is now open. line

Robyn Karnauskas

you Hi taking guys. for Thank question. the

you IO. what you on the were any especially so do First think forward, one they executive what on implemented Christi, being orders Dan, the going might and would development? think business thoughts if how a And run do for else about might deals to competitive space be business you What augment CAR-T in It’s moving portfolio? you the other you your like need to forward? in and lot with of the things to done biospecifics Thanks.

Daniel O'Day

we variety Yes, we mean, to let at me change. different of leaning mean, And needs I all, the into step thanks big Gilead Robyn. know agree a the of same executive first are U.S. is have that important of from and at that all current been orders. that I time now take system to we're that back U.S. I patients for is that in the in look at that fronts a we years. just a maintain model. the that one couple innovation that in What's really when the a done changes ensures benefit the system way in U.S. the

working types to that the things different just principles articulated reflected and Senate go. Congress where the been these look with engaging to with we'll and the have have the others I we’ll all we've that. And and forward executive that's orders, White very within as the packages the that of with So, now, be we looking at House mentioned

you firmly But bar with in is terms say of other medicine, high capital course The high first-in-class so around the think hard a so disproportionally that us. future any systems important any other our governmental to action. so under the business, how long, that if working particular impacts, investment we think system hold we decade cycle scenario. can't pivoting how enough healthcare high keep the to of is U.S. is that because under the best-in-class is that the and we're the about we bottom bar enough that we words, or really think, and belief keep our I many that our that have one world, transformational line I remember time on you regard, would if be bar In is about in

well for and first patients we'll do we'll think well all, shareholders do for of of I result that. as a

Christi, belief. please. firm you on question my to that's So over Robyn’s

Christi Shaw

Robin. Thanks Yes.

do of in CAR I looking and help we're like. the of patients. aren't show short of So XX% with Yescarta able at the is alive effects duration patients term, almost only three other cure the how of longest patients over the how CAR-T that think we'd we those we getting the been XX% that's being do that T to cell the years

are the is and build actually portfolio are others Phase terms our the long-term And care. just able bit Gilead low-hanging that therapies, both to therapies INDs the the the So the to look look the to the of bets the combine of being And some to is future we would area. it's tumor high studies one Have where complex companies of three you therapies would kind solid very there's as in standard of we've that and compared at cell together. at of be and areas strategies science able that other is of mid penetrate with bar easier then to on got building Xs, non-cell being of as strengths our that in where term, longer really in be too specific biggest tumor. solid fruit, little a and

the success as able So today, though keeping launching look to not closed, get those being we efficacy therapy, two them we lot of in could and iPSC the that's did, that can from we development them some some cells deals business you that. allogeneic technology, Kite with with positive of and head tumor. we're in solid areas more at the you, see both in that in partake that NK addition hematological possible disruptors come alone terms eyes a and what I cell or sand, lead of then tell where to in potential and moving with will malignancies, our of Gilead outcomes

arena, that we at as as partners at our externally. off-the-shelf look ways movers in were that different some the we of So internally and both look first

Robyn Karnauskas

Thank you.

Christi Shaw

Sure.

Daniel O'Day

you, Thank Robyn.

time, that respect one is everybody's kind that question, Liz. if now more we’re take time I at in could So there we for of

Operator

comes question from last Our with ISI. Umer Raffat Evercore

is line open. now Your

Umer Raffat

Hi squeezing I in. I two for have guys. if Thanks me may.

need feedback know inhaled exposure the very get resistant why on highest filing, curious inhibitor. with much. on what Phase curious. I team patients given the Merdad, the And fold your basis My can form for I'd form this hits, patients? resistant there's is that secondly, many you is HIV up dose? multidrug X how and an lung unmet the at form the the the the coming accelerated if Thank in IV First with capsid multidrug shouldn't trial of in for from very higher be remdesivir question your you it

Daniel O'Day

Umer terrific. decide – if want great. I’ll or Thanks. Merdad numbers. to decide you the That's Diana you feed

Merdad Parsey

Well, Sure. talk exposure capsid. about and do can I'll the you lung Diana,

the go, that we exposure depending we need how We not Diana, lung are great to you how the but good we we do on better high So and least empiric targeting at the with a to you than with get goal. IV. would talk if see trials in did version exposure good inhaled obviously to we as is. think that's our think version can and the the want hopefully we That's very about and with thing greater what it capsid? as IV deposition lung, get the can go

Diana Brainard

would be that Yes, great.

terms experienced urgent and Phase trial to that in designation, granted patient patients, in it's study need Umer So Xb in of population. Phase a move because the highly breakthrough that that registrational us treatment in population, we that agency a they could directly from actually the X/X of agreed unmet

out, lenacapavir should patients now, application experienced basis in right with ongoing the that's for pan study treatment will highly this months. an approval for the the six results every so And form dosed

Umer Raffat

Thank you so much.

Operator

I'd to for back remarks. turn like closing today's call That the Douglas session. to concludes Maffei question-and-answer

Douglas Maffei

looked here all Liz. your us the joining team updates And Gilead. you, in to with continued future progress. thank our today. And forward interest you on for you appreciate Thank We providing

Operator

gentlemen, and day. in for the program Ladies you may have you conference. today's concludes Everyone, now thank disconnect. This a great participating

Gilead Sciences (GILD) 30 Jul 202020 Q2 Earnings call transcript