Gilead Sciences, Inc. (GILD) - Get Gilead Sciences, Inc. Report beat earnings and revenue estimates and said it's expanding production of its remdesivir drug, which is in trails as a possible treatment for Covid-19.
The company reported non-GAAP diluted earnings of $1.68 a share on revenue of $5.5 billion. Analysts surveyed by FactSet had been forecasting $1.57 a share, on sales of $5.4 billion. In the same period a year ago, the company posted earnings of $1.76 a share on sales of $5.3 billion, according to FactSet data.
"Our focus at this time is on both our work with remdesivir and our ongoing commitments to the people who depend on our medicines today," said Daniel O’Day, chairman and CEO in a statement.
Gilead has drawn intense interest from investors in recent weeks as its remdesivir has seen positive results as a possible treatment for Covid-19 in recent trials.
O'Day said on a conference call with analysts that the company plans to donate about 1.5 million vials of the drug, enough for about 140,000 treatments. Costs associated with ramping the drug's production could reach as much as $1 billion according to company executives on the call, raising concerns among analysts. "There's been no other time like this in the history of the planet," O'Day told analysts. "We need to be very thoughtful of how we provide access."
The company said "while COVID-19 did not materially impact Gilead’s first-quarter results, Gilead anticipates that COVID-19 could impact its business in the short-term due to factors such as fewer patients accessing treatment for conditions such as HIV and HCV," according to the statement.
It added that "the total investments in remdesivir, primarily to expand manufacturing production, throughout 2020 could be material, but the amount, timing and accounting for the investments as well as the potential to recoup Gilead’s at-risk investments at some point in the future are dependent on clinical trial and regulatory outcomes."
The company "will focus on making remdesivir both accessible and affordable to governments and patients around the world," according to the statement.
Gilead Sciences shares fell $1.20, or 1.4%, to $82.80 in after-hours trading.