Gilead raises its 2024 outlook and expects new drug submissions by the end of the year

Gilead Sciences (GILD) raised its growth forecast for the year on strong third-quarter results, marking a shift from its COVID sales and raising investor anticipation for new products in the near future.

In third-quarter results on Wednesday, the company raised its 2024 guidance – bucking the opposite trend from big pharma this quarter – and beat both revenue and profit results.

CEO Daniel O'Day told Yahoo Finance that the company's third quarter was its best this year.

“This was the strongest quarter of the year for us. It really shows the strength of our business model… and that applies to both our old business, our HIV business, our virology business, but also the new business areas of oncology and also inflammatory diseases,” he said.

On the post-earnings call with investors, Chief Financial Officer Andrew Dickinson said the company's success was driven by surprise sales increases for its COVID-19 antibody drug Veklury, as well as sales of its legacy HIV portfolio.

“We … expect full-year 2024 total product sales to be in the range of $27.8 billion to $28.1 billion, up $650 million at the midpoint compared to the prior range,” Dickinson said.

The company reported revenue of $7.5 billion, up 7% from a year ago and beating Wall Street estimates by about 7%. Additionally, Gilead reported adjusted earnings per share of $2.02, beating Wall Street expectations by nearly 30%.

The stock is up nearly 6% on Thursday and is trading at more than $96 per share, compared with a market closing price of $91.69 per share. Jefferies analyst Michael Lee said in a note to clients late Wednesday that the stock had risen 40% since the summer, when it bottomed at $63 a share.

Sales of the company's HIV portfolio increased 9%, an area where the company continued to build strength as it diversified into oncology and inflammatory diseases over the past five years. This includes the $12 billion acquisition of Kite Pharma, which strengthened Gilead's oncology pipeline.

“What the investment community is recognizing is that the sustainability of this underlying business extends well into the late 2030s and early 2040s. And that's very different than the outlook we had five years ago,” O'Day said.

He said that's why the company doesn't face the same pressures as larger pharmaceutical companies, such as the federal government's pricing and patent policies. However, Gilead has faced a series of its own investigations and legal settlements related to patent gaming – most recently a $40 million settlement over delaying the release of a life-saving HIV drug to boost profits.

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