Sales of its Covid-19 treatment could be worth more than $3 billion this year for Gilead Sciences, Citigroup’s Mohit Bansal said in a Monday morning note. That prospect inspired the analyst to raise his sales forecast and his price target for the stock to $80.
Gilead shares (ticker: GILD) were up 2.4% near midday Monday to $71.23. The S&P 500 was up 0.8%.
After donating its first batches, Gilead is now charging about $500 a vial in the U.S. for its antiviral drug remdesivir, and about $390 abroad. A course of treatment for hospitalized Covid patients uses about six vials. For the second half of this year, Bansal forecasts about 500,000 U.S. treatments and 625,000 elsewhere. That would add up to $3.1 billion to second-half revenue.
The remdesivir sales are a lucky thing for Gilead, because Covid lockdowns reduced the number of new patient starts for the company’s hepatitis-C drugs for the second quarter. Last week, Gilead reported that new starts fell 42% in the U.S. and 58% in Europe from the previous quarter. Consequently, earnings results fell short of expectations.
Bansal thinks the drugmaker’s hepatitis-C sales will recover by year-end. The second half will bring mixed news. Gilead’s HIV drug Truvada will go generic, but the company hopes to introduce a new product, Filgotinib, for autoimmune diseases such as arthritis. It is in a class of drugs known as JAK1 inhibitors, where it would compete against products from AbbVie (ABBV), Eli Lilly (LLY) and Pfizer (PFE).
Bansal now forecasts $7.08 a share in 2020 earnings for Gilead, on total sales of $24.2 billion. Next year, remdesivir sales should be lower, and Truvada’s expired patent will take down revenue, so Bansal figures earnings will drop to $6.89 a share
