Truvada Paces Gilead

Gilead's(GILD Quote) second-quarter earnings rose 35% from a year ago, paced by sharply higher sales of its HIV treatment Truvada.

Gilead earned $265.2 million, or 56 cents a share, in the quarter, compared with $196 million, or 41 cents a share, a year ago. Analysts were forecasting 54 cents a share in the latest period. Gilead said options expenses reduced latest-quarter earnings by 5 cents a share.

Second-quarter sales rose 38% from a year ago to $685.3 million, beating the Thomson First Call consensus estimate by about $20 million. Truvada sales rose 143% from a year ago to $299.3 million, while sales of AIDS drug Viread fell 20% to $167.4 million. The company said the decline represented a switch to Truvada among patients.

Sales of hepatitis B medication Hepsera rose 24% to $56.8 million.

"Our year-to-date revenues from total product sales have exceeded a record $1 billion," the company said. "Gilead's strong sales are, in part, a result of the growth rates seen in the European markets, where we hit a major milestone in the second quarter of this year with nearly $250 million in European product sales. This is a very exciting time for the company as we continue to make great strides in accomplishing our goals for the year."

Gilead's research and development expense was $90.5 million in the latest quater, up from $59.7 million a year ago. The company cited a higher headcount, increased clinical, product development and research activities with hepatitis C, hepatitis B and HIV programs, and options expenses.

Gilead shares closed at $59.35 Thursday, down 3.1% on the session but up 13% for the year. The price is 27.2 times this year's Thomson First Call consensus earnings estimate of $2.18 a share and 23.8 times next year's consensus of $2.49 a share.