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Five Gilead Sciences insiders made healthy sales of stock from Sept. 26 through Oct. 1, disposing of 329,520 shares for $34,719,602, an average of $105.36 each, as shares of the biotech traded an all-time-high price. The sales were planned 10b5-1 transactions and included options exercises and sales.
Chief Executive and Chairman John C. Martin exercised options and sold 140,625 Gilead (ticker: GILD ) shares for $14,893,844. Regulatory filings show the options were exercised at $8.05 each and were set to expire Jan. 26, 2015. Martin now directly holds 4,429,837 shares, a stake of less than 1%.
His most recent previous transaction was on Sept. 2, when he exercised options and sold 140,600 shares for $15,300,000, an average of $108.64 each, also through a planned sale.
Chief Operating Officer and President John F. Milligan exercised options and sold 146,895 shares for $15,365,818. He now directly holds 974,048 shares. The options were exercised at $8.05 each and were set to expire Jan. 26, 2015.
Milligan’s most recent previous transaction was on Sept. 8, when he exercised options and sold 146,900 shares for $15,600,000, an average of $105.99 each, also through a planned sale.
Paul Carter Rutherford, executive vice president, commercial operations, exercised options and sold 4,000 shares for $427,730. Gregg H. Alton, executive vice president, corporate and medical affairs, exercised options and sold 33,000 shares for $3,497,258. Richard J. Whitley, a director, exercised options and sold 5,000 shares for $534,950.
Martin and Milligan joined Gilead in 1990. Martin has been CEO since 1996 and is a former Bristol-Myers Squibb ( BMY ) executive. Milligan became COO in 2007 and added the president title in 2008. Whitley is a distinguished professor, Loeb Scholar Chair in Pediatrics, professor of pediatrics, microbiology, medicine and neurosurgery, University of Alabama at Birmingham.
A Gilead spokeswoman was not immediately available to comment on the transactions.
Jonathan Moreland, director of research for InsiderInsights.com, considers these sales to be Insignificantly Bearish, despite their sizes.
In an interview with Barrons.com, Moreland says, “It’s unsurprising for these insiders with 10b5-1 programs to understandably diversify their wealth, which has obviously become more concentrated over the past several years, given the run of the stock.”
Shares traded to as high as $110.64 on Sept. 30, a record. Including Gilead’s Monday close of $101.44, shares have gained 35% for the year-to-date.
“We would avoid Gilead like it’s hepatitis C,” Dr. Ian Dogan, director of research for InsiderMonkey, writes in an e-mail. “Gilead seems very cheap with a forward price/earnings ratio of 12 but there are huge political risks. Gilead’s new pricing policy is pushing the boundaries and pretty soon we will see spam e-mails trying to sell smuggled Sovaldi [hepatitis C treatment] from countries like India where the drug is priced at a 99% discount. We think insiders will continue selling their holdings in order to protect themselves from regulatory action that may turn [Gilead] into a utility.”
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