Avid Bioservices Inc (CDMO)

[north40000]

Back to a familiar story and question---What is GILD looking for in a cornerstone molecule or platform?:

http://www.pharmaphorum.com/articles/raising-the-bar-can-gileads-next-challenge-be-even-bigger-than-hep-c

In light of its success in HIV and HCV, and with an end to its market there not yet in sight, I would speculate that GILD may bide its time......

An excerpt:

The numbers treated so far[~600k] are just the tip of the iceberg – an estimated 185 million people worldwide are infected with the virus, which slowly and silently ravages the liver for years, symptoms often only emerging once the disease is advanced. If it remains undetected, the individual can develop fibrosis and cirrhosis, and may eventually need a liver transplant. Previous drug regimens took months of treatment, with many patients failing to clear the virus completely, but Sovaldi and Harvoni have changed the outlook completely. Followed closely by rival direct-acting antivirals (DAAs) from AbbVie, Merck and Janssen, the drugs now offer a cure to more than 90 per cent of patients (depending on their genotype) within as little as eight weeks.

Although it will be decades away, the global elimination of HCV is now a realistic prospect.

The enormous success of its HCV drugs has equally transformed Gilead, making it one of the world's most valuable companies. The Sovaldi/Harvoni franchise is set to become the biggest-selling product in the world this year, with forecast 2015 sales of $18 billion.

HCV patients' gain has been payers' pain, however. The high cost of the drugs has created a huge problem for healthcare systems around the world, and the firm has been forced to offer substantial discounts on its prices, particularly in the US, where Sovaldi costs $84,000 for a course of treatment, or $1,000 per pill.

However even this pushback from payers has only tempered the firm's growth slightly. Revenues rocketed to $8.21 billion for the third quarter, up an exceptional 38 per cent compared to the same period last year.

This puts the company on track to earn more than $30 billion for the full year, pushing it up the industry rankings and likely to overtake 'big pharma' stalwarts GlaxoSmithKline (GSK) and AstraZeneca.

There are clear signs, however, that the explosive increase in Sovaldi and Harvoni sales is now slowing, with sales actually slipping back slightly between Q2 and Q3 this year. Inevitably, investors are hungry for more growth, and are asking what the firm can do to maintain its stellar performance.

Many investors would welcome Gilead spending its spare billions on buying another big pharma or biotech company – chief executive Peter Martin paid out $11 billion to snap up Sovaldi (sofosbuvir) and the company which discovered it, Pharmasset, in 2012.

Martin and his team have shown themselves adept at spotting golden opportunities in M&A and in-licensing, such as Sovaldi, over the years. But acquisitions alone can't be relied on to sustain a company, which means the in-house R&D team must develop its own breakthroughs.

Mission accomplished in HCV and HIV

The company's research chief is Norbert Bischofberger and he and his team are ambitious to keep pushing on to the next big challenge – and re-orientate their R&D focus when necessary.

Illustrating this point is a bold declaration from Bischofberger that Gilead has already ceased drug discovery in HCV and in HIV therapeutics – as there is nothing more to be done.
[much more]