Gilead Sales of Hepatitis C Drugs Fall 19%

Gilead Sciences Inc. said its revenue from its hepatitis C drugs continued to fall, dropping 19% during the second quarter, with sales of Harvoni missing expectations as competition from rival drugs and pricing pressures intensified.

Shares of the company slipped 3% to $85.90 after hours.

The Foster City, Calif., biopharmaceutical company also lowered its 2016 product sales outlook to $29.5 billion to $30.5 billion, from its previous estimate for products sales of $30 billion to $31 billion.

For the latest quarter, Gilead reported Harvoni sales decreased 29% to $2.56 billion, while Sovaldi sales rose 5.2% to $1.36 billion. Analysts had expected Harvoni sales of $2.87 billion and Sovaldi sales of $1.19 billion, according to FactSet.

The company also said its recently approved combination hepatitis C drug, Epclusa, which is priced lower than the older hepatitis C treatments, generated sales of $64 million.

Investors likely will be listening on the conference call for any additional details about the roll out of Epclusa, along with any comments about the company's drug-development pipeline.

Gilead dominates the market for hepatitis C drugs, where prices for the costly medicines have come down amid growing competition and as the portion of government-funded payers have risen and discounts to commercial health insurers have increased. Rivals AbbVie Inc., maker of hepatitis C treatment Viekira Pak, and Merck & Co., maker of recently approved Zepatier, plan to release their second-quarter results Friday.

Over all, Gilead reported a profit of $3.5 billion, or $2.58 a share, down from $4.5 billion, or $2.92 a share, a year earlier. Excluding acquisition-related expenses, stock-based compensation and other items, adjusted per-share earnings fell to $3.08 from $3.15. Product sales decreased 5.8% to $7.65 billion.

Analysts polled by Thomson Reuters expected per-share profit of $3.02 and product sales of $7.77 billion.

Write to Tess Stynes at [e-mail]

(END) Dow Jones Newswires

July 25, 2016 17:05 ET (21:05 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.