HIV Drug Sales Boost Gilead Profits

Updated from 5:07 p.m. EDT

Gilead Sciences GILD trounced Wall Street targets with its first-quarter financial numbers after the market close Wednesday.

Shares of the Foster City, Calif.-based biotech company climbed more than 3% after the earnings release. But the stock settled in recent after-hours trading, down 80 cents, or 1.5%, at $51 after the company's earnings call, which included reaffirmation of previous 2008 guidance.

The HIV drug specialist reported earning $522.1 million, or 54 cents a share, before items, compared to $447.6 million, or 46 cents a share, in the year-ago quarter. On a GAAP basis, the company earned 51 cents a share. Revenue rose 22% to $1.26 billion.

Results beat estimates of analysts surveyed by Thomson Financial who'd expected earnings of 48 cents a share on $1.2 billion in revenue.

Sales totaled $1.14 billion for the quarter, with $946.7 million of that from the HIV franchise. HIV drug Truvada brought in $479.4 million, beating the Wall Street consensus target of $468 million. Atripla sales totaled $324.2 million, beating the consensus target of $311 million.

Viread sales decreased 5% to $152.7 million, in light of lower sales volumes in the U.S. and Europe, according to the company. But it still beat Wall Street's target of $146 million.

On its earnings conference call, Gilead executives said recent study data had no impact on revenue from its HIV drug franchise in the first quarter.

Away from the HIV franchise, Gilead reported $83 million in sales from chronic hepatitis B drug Hepsera, edging past Wall Street's $79 million view. And the company reported $71 million from AmBisome for severe fungal infections, also beating the $67 million consensus target.

The company reported $20 million in sales of hypertension drug Letairis, which, management said on the call, was in line with its expectations. This was shy of analysts' predictions of $23 million. It was the second quarter since the drug's approval that Letairis was sold without large numbers of patients receiving it for free.

Sales benefitted from the weakness of the U.S. dollar. Gilead said that including the impact of hedging activities, the net foreign currency exchange impact was a favorable $37 million on revenue and $19.6 million on net earnings over last year.

On the quarterly conference call Wednesday, management reiterated its full-year revenue guidance and lowered its expected effective tax rate to between 28% and 29% from between 29% and 30% for full-year '08.