Replies to post #184125 on Biotech Values

[Rocky3]

From Wells;

**Harvoni/Sovaldi IMS data week-ended 11/21/14 now available. With Harvoni NRx flattening week over week
but TRx higher than we had projected, it suggests Harvoni TRx could exit 2014 at a steady-state of around
~7,000 scrips/week.
**Specifically, Harvoni NRx (key measure, in our view, as this reflects new patient starts) were flat week over
week, to 3,008 from last week's 3,004, +0.13%. We assume multiple drivers in place, with potential for
warehoused patients plus increased demand due to Harvoni's better convenience offset by potential insurance
barriers (including those awaiting ABBV availability) and lower treatment initiations as holiday season
approaches. Sovaldi NRx continued to decreased slightly, to 988 from 1,079, -8.43%, as we continue to look for
the GT-2/3 ''floor'' revenue base for that drug.
**Total prescriptions across GILD's HCV franchise were increased slightly week over week, to 7,813 from
7,424, +5.24%. This measure is initially less important in our view, as we believe overall franchise TRx growth
will be compressed for months by the previous weekly declines in new patient starts on Sovaldi due to
warehousing. Still, it does influence Q4 numbers, so growth is a positive.
**If Harvoni new parts starts are flat the remainder of 2014, our tracker suggests Q4 U.S./WW sales tracking
at $3.22B/$3.97B versus FactSet consensus' $3.8B estimate. This does include a net positive inventory build,
as we assume Sovaldi inventory drawdowns mostly occurred last quarter.
**BOTTOM LINE: GILD's total HCV franchise sales continue to track comfortably within or above consensus
estimates for Q4 2014 and should exit the year at a favorable steady-state into the ABBV launch, which could
help reduce concerns about the overall market opportunity next year and expand the multiple. Any analysis is
independently arrived at by Wells Fargo Securities, LLC, on the basis of the data and other information, and
IMS is not responsible for any reliance by recipients on either the data or any analyses thereof.