Following the 100% efficacy results from the PURPOSE-1 and PURPOSE-2 trials, how does the anticipated 2025 regulatory filing and commercial launch of lenacapavir for HIV PrEP alter the long-term terminal value of Gilead Sciences (GILD) relative to its maturing Biktarvy franchise?

The anticipated 2025 regulatory filing and commercial launch of lenacapavir (marketed as Yeztugo for PrEP) represents a fundamental shift in Gilead Sciences’ (GILD) long-term valuation. By transitioning from a maturing, daily-oral franchise (Biktarvy) to a long-acting, platform-based architecture, Gilead is effectively de-risking its "terminal value" and extending its HIV market leadership into the late 2030s. 📊 Strategic Pivot: From Product to Platform The 100% and 96% efficacy results from the PURPOSE-1 and PURPOSE-2 trials have transformed lenacapavir from a niche treatment for multi-drug resistant HIV into the cornerstone of Gilead’s future growth. PrEP Market Expansion: Current oral PrEP (Descovy/Truvada) is limited by adherence challenges. A twice-yearly injectable significantly expands the Total Addressable Market (TAM) by reaching populations where daily pill-taking is a barrier. Analysts project peak sales for lenacapavir in PrEP alone to reach $4B - $6.5B . Cannibalization vs. Accretion: While lenacapavir will likely cannibalize Gilead’s own Descovy (which holds ~ 40% of the U.S. PrEP market), the superior clinical profile and premium pricing of a long-acting injectable are expected to be net-accretive to margins and revenue. 🛡️ Lifecycle Management: Defending the Treatment Franchise The terminal value of Gilead has historically been suppressed by the "patent cliff" of Biktarvy, which generated $14.3B in 2025. Gilead is utilizing lenacapavir to bridge this gap through two primary mechanisms: 1. The "Switch" Strategy (BIC/LEN): Topline results from the ARTISTRY-1 and ARTISTRY-2 trials demonstrated that a once-daily oral combination of bictegravir + lenacapavir is non-inferior to Biktarvy. This allows Gilead to transition its treatment base to a new, patent-protected regimen before Biktarvy’s exclusivity ends. 2. Extended Exclusivity: While Biktarvy’s core patents were initially set to expire in 2033, recent settlements with generic manufacturers (Lupin, Cipla, Laurus) have pushed the earliest U.S. generic entry to April 1, 2036 . This provides a critical 10-year window to migrate the patient base to lenacapavir-based long-acting options. 📈 Terminal Value & Valuation Implications In a Discounted Cash Flow (DCF) framework, the "terminal value" often accounts for 60-70% of a biotech’s total valuation. Lenacapavir alters this in three ways: Multiple Expansion: By proving it can survive the Biktarvy cliff, Gilead’s P/E multiple has seen upward pressure. As of early 2026, the stock has traded at approximately 12x - 14x forward earnings, up from its historical 5-year average of ~ 10x . Revenue Durability: The shift to injectables creates higher "switching costs" and stickier revenue streams compared to oral pills, which are more susceptible to generic erosion. Pipeline Optionality: The development of a once-yearly injectable (Phase 1 data presented at CROI 2025) suggests a "moat" that competitors like GSK may find difficult to breach, further securing long-term cash flows. ⚠️ Risks and Uncertainties Despite the clinical success, several factors could temper the terminal value upside: Policy & Pricing: The Medicare Part D redesign and potential U.S. government budget cuts to HIV prevention programs could impact net pricing and volume. Execution Risk: Transitioning a market from daily orals to provider-administered injectables requires significant investment in healthcare infrastructure and "buy-and-bill" systems. Competition: GSK’s Apretude and their pipeline of 4-month and 6-month injectables remain a formidable threat in the long-acting space.

In light of the recent mixed clinical performance of Trodelvy in non-small cell lung cancer (NSCLC) trials and the intensifying competitive landscape for antibody-drug conjugates (ADCs), how should investors recalibrate Gilead Sciences’ (GILD) 2030 target of generating one-third of total revenue from its oncology segment?

The recent clinical setbacks for Trodelvy (sacituzumab govitecan) in non-small cell lung cancer (NSCLC) and metastatic urothelial cancer (mUC), combined with intensifying competition in the antibody-drug conjugate (ADC) space, necessitate a significant recalibration of Gilead Sciences’ (GILD) 2030 oncology revenue target. While management maintains its commitment to the goal of generating one-third of total revenue from oncology by 2030, current financial trajectories and pipeline dynamics suggest a widening gap between ambition and execution. 📊 Current Oncology Revenue Gap Analysis As of the FY 2025 financial results, Gilead’s oncology segment remains a secondary contributor to the group’s top line, which continues to be dominated by its HIV franchise. Total FY 2025 Revenue: $29.4B Total Oncology Revenue: Approximately $3.2B (~11% of total revenue) Trodelvy Sales: $1.4B (+6% YoY) Cell Therapy (Yescarta/Tecartus): $1.8B (-7% YoY) 2030 Target Requirement: To reach the one-third threshold (assuming a conservative $30B-$32B total revenue base), oncology must generate $10B+ annually. This requires a Compound Annual Growth Rate (CAGR) of approximately 25% through 2030, a steep trajectory given recent performance. 🧬 Clinical Setbacks and Competitive Displacement The recalibration is primarily driven by the loss of high-probability "peak sales" scenarios for Trodelvy in major indications. 1. NSCLC Setback (EVOKE-01): The Phase 3 failure to meet the primary endpoint of overall survival (OS) in second-line metastatic NSCLC significantly limits Trodelvy’s addressable market. While a 3.5-month OS benefit was observed in a subgroup of anti-PD-(L)1 non-responders, this post-hoc analysis may not suffice for broad regulatory approval or market leadership. 2. Bladder Cancer Withdrawal: The failure of the confirmatory TROPiCS-04 trial in mUC led to the withdrawal of that indication, removing a key growth pillar and resulting in a $2.4B impairment charge in early 2025. 3. The "Datroway" Threat: AstraZeneca and Daiichi Sankyo’s Dato-DXd (Datroway) received FDA accelerated approval in June 2025 for EGFR-mutated NSCLC. It is now a preferred second-line regimen in NCCN guidelines (Version 1.2026), effectively displacing Trodelvy’s potential first-mover advantage in the TROP2-directed ADC class for lung cancer. 4. Merck’s Entry: Merck’s sac-TMT (sacituzumab tirumotecan) demonstrated a 51% reduction in the risk of disease progression in EGFR-mutated NSCLC (OptiTROP-Lung04), further crowding the late-line treatment landscape. 📉 Cell Therapy: From Growth Engine to Defensive Play Gilead’s cell therapy franchise (Kite Pharma) is facing unexpected "erosion" rather than expansion. Competitive Headwinds: Sales of Yescarta and Tecartus declined by -7% in 2025, pressured by the rise of bispecific antibodies and new CAR-T entrants like BMS’s Breyanzi and J&J’s Carvykti. Strategic Pivot: While the FDA recently removed certain prescribing limitations for Yescarta, the segment is transitioning from a high-growth driver to a defensive asset focused on maintaining market share in specialized centers. 🔍 Investor Implications & Recalibration Investors should consider the following adjustments to their long-term valuation models for GILD: De-risking the 2030 Target: The "one-third" goal now appears aspirational rather than a baseline projection. Achieving this target likely requires a major accretive acquisition (M&A) or a "home run" success from the anti-TIGIT (domvanalimab) program in 1L NSCLC. Valuation Floor: Gilead’s valuation remains anchored by its HIV cash cow (Biktarvy sales: $14.3B in 2025). The oncology segment is increasingly viewed as "optionality" rather than a guaranteed growth engine. 2026 Catalysts: Management has signaled two potential cancer therapy launches in 2026. Success here is critical to restoring institutional confidence in the oncology strategy.

Given the recent FDA approval and ongoing commercial launch of Livdelzi (seladelpar), what specific evidence from Gilead Sciences’ (GILD) 2025 guidance suggests the company can successfully penetrate the Primary Biliary Cholangitis (PBC) market and achieve the peak sales expectations originally modeled during the CymaBay acquisition?

Gilead Sciences’ (GILD) performance throughout fiscal year 2025, as reflected in its guidance and subsequent earnings reports, provides robust evidence that Livdelzi (seladelpar) is on a trajectory to meet or exceed the peak sales expectations established during the $4.3B acquisition of CymaBay Therapeutics. The following analysis details the specific commercial, clinical, and competitive evidence from the 2025 fiscal period that supports this market penetration thesis. 📈 Commercial Trajectory and Market Leadership Gilead’s 2025 guidance and actual results demonstrate a "rapid adoption" curve that validates the commercial synergy of the CymaBay acquisition. Revenue Acceleration: Livdelzi achieved $150M in revenue during Q4 2025 alone, representing a 42% sequential increase from Q3. This rapid ramp-up suggests the drug is tracking toward the $1B+ annual "blockbuster" threshold significantly faster than initial conservative models suggested. Market Share Dominance: By the end of 2025, Gilead reported that Livdelzi had secured more than 50% of the U.S. market share in second-line Primary Biliary Cholangitis (PBC). This leadership position was achieved less than 18 months post-launch, underscoring the effectiveness of Gilead’s established liver disease sales infrastructure. Guidance Outperformance: Gilead’s total product sales (excluding Veklury) for 2025 reached $28.0B , exceeding the high end of its original guidance range. Management specifically cited the "remarkable" demand for Livdelzi as a primary driver for the outperformance within the Liver Disease portfolio, which grew 17% year-over-year in Q4. 🧬 Clinical Differentiation as a Growth Catalyst A critical component of the CymaBay acquisition was the belief that seladelpar’s clinical profile was superior to existing second-line therapies. 2025 data and physician feedback have reinforced this: The "Pruritus" Advantage: Unlike its primary competitor, Iqirvo (elafibranor), Livdelzi’s FDA label includes specific data on the reduction of pruritus (chronic itch), a debilitating symptom affecting up to 80% of PBC patients. 2025 real-world data presented at major liver congresses showed that over half of patients reported significant improvement in itch, a key driver for physician switching. Biochemical Response Rates: Long-term data from the Phase 3 ASSURE study released in late 2025 showed that 67% of participants achieved a composite biochemical response after three years, with 34% achieving normalization of alkaline phosphatase (ALP) levels. These durable results support long-term patient persistence, a necessity for achieving peak sales. ⚔️ Competitive Landscape and Market Dynamics The 2025 guidance period saw a significant shift in the competitive environment that favored Gilead’s market capture: Competitor Attrition: The withdrawal of a key competitor product in the U.S. (Ocaliva) from certain segments of the market—following regulatory setbacks and safety concerns—created a vacuum that Livdelzi aggressively filled. Gilead noted that much of the "switching activity" from older therapies occurred in late 2025, providing a high baseline for 2026 growth. International Expansion: Gilead successfully launched Livdelzi in Germany in 2025 and guided for continued expansion into major European markets throughout 2026. This global rollout is essential for reaching the upper bound of peak sales estimates, which range from $2.0B to $2.9B by the early 2030s. ⚠️ Risks and Forward-Looking Considerations While the 2025 evidence is overwhelmingly positive, several factors remain critical for sustaining this momentum: Label Expansion: Success in the ongoing IDEAL study (targeting patients with lower ALP levels) is required to expand the addressable patient population beyond the current second-line indication. Reimbursement Hurdles: While U.S. coverage has been strong, some European health technology assessments (e.g., NCPE in Ireland) have initially rejected reimbursement at submitted prices, suggesting potential pricing pressure in international markets. Long-term Safety: As an accelerated approval product, Livdelzi must continue to demonstrate a clean safety profile in confirmatory trials to maintain its market-leading position.

Gilead Sciences, Inc. (GILD) Stock Price & AI Analysis

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Valuation

50Fair Value

Sentiment

55Neutral

Risk

100Low Risk

Momentum

94Positive

Institutional-Grade Intelligence

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Actionable Intelligence

AI-driven stance, execution logic & risk thresholds

Catalyst Roadmap

Event timeline with expected impact & market context

Deep Insights

Fact-checked analysis & score logic breakdown

Financial Statements

Margin Trends

Gross

86.7%▲8.4pp

Revenue after COGS

Operating

40.1%▲34.4pp

After operating expenses

Net

28.9%▲27.2pp

Bottom-line profitability

Gross Margin

Operating Margin

Net Margin

Valuation Snapshot

P/E Ratio

17.9

Price vs earnings

EV/EBITDA

14.1

Enterprise value

FCF Yield

6.6%

Cash generation

Earnings Yield

5.6%

Inverse of P/E

Capital Efficiency

25

GoAI Quality ScoreExcellent

ROEReturn on Equity

37.6%Strong

ROAReturn on Assets

14.4%Strong

ROICReturn on Invested Capital

21.7%Strong

Financial Health

Current RatioHealthy

1.68

Short-term solvency (>1.5)

Net Debt / EBITDANet Cash

0.00x

Debt repayment capacity (<3x)

Income QualityStrong

1.18

Cash backs earnings (>1)

Revenue & Profitability

Revenue

Net Income

Net Loss

Income Statement

Metric	FY2025	FY2024	FY2023	FY2022	FY2021
Revenue	$29.44B	$28.75B	$27.12B	$27.28B	$27.30B
Gross Profit	$25.52B	$22.50B	$20.62B	$21.62B	$20.70B
Gross Margin	86.7%	78.3%	76.0%	79.3%	75.8%
Operating Income	$11.82B	$1.66B	$7.61B	$7.33B	$9.92B
Net Income	$8.51B	$480.00M	$5.67B	$4.59B	$6.22B
Net Margin	28.9%	1.7%	20.9%	16.8%	22.8%
EPS	$6.84	$0.38	$4.54	$3.66	$4.96

Average Price Target

$157.38▲ 3.9% Upside

Past 12 Months

12 Month Forecast

Based on 50 Wall Street analysts offering 12 month price targets for Gilead Sciences, Inc., the average price target is $157.38, with a high forecast of $177.00 and a low forecast of $105.00. The average price target represents a 3.9% increase from the current price of $151.40.

Highest

$177.00

Average

$157.38

Lowest

$105.00

Rating Distribution

Strong Buy

0

0%

Buy

37

64%

Hold

20

34%

Sell

1

2%

Strong Sell

0

0%

Recent Analyst Ratings

FirmActionRatingDate

Scotiabank● Maintain

Sector Outperform

2026-02-11

Truist Securities● Maintain

Buy

2026-02-11

RBC Capital● Maintain

Sector Perform

2026-02-11

Wells Fargo● Maintain

Overweight

2026-02-11

Cantor Fitzgerald● Maintain

Overweight

2026-02-11

Needham● Maintain

Buy

2026-02-11

Citigroup● Maintain

Buy

2026-01-27

Truist Securities● Maintain

Buy

2026-01-27

UBS● Maintain

Buy

2026-01-26

Morgan Stanley● Maintain

Overweight

2026-01-13

Earnings History & Surprises

BEAT RATE

78%

Last 18 quarters

AVG SURPRISE

+8.3%

EPS vs Estimate

BEATS / MISSES

14/4

Last 18 quarters

LATEST EPS

$1.86

Q1 '26

QUARTERLY EPS TREND

Estimated

Beat

Miss

QUARTERLY DETAIL

Q1 '26

+2.8%

$1.86 vs $1.81

Q4 '25

+16.0%

$2.47 vs $2.13

Q3 '25

+2.6%

$2.01 vs $1.96

Q2 '25

+1.7%

$1.81 vs $1.78

Q1 '25

+9.2%

$1.90 vs $1.74

Q4 '24

+32.0%

$2.02 vs $1.53

Q3 '24

+24.8%

$2.01 vs $1.61

Q2 '24

+11.4%

$-1.32 vs $-1.49

Q1 '24

-2.3%

$1.72 vs $1.76

Q4 '23

+19.9%

$2.29 vs $1.91

Q3 '23

-16.3%

$1.34 vs $1.60

Q2 '23

-16.0%

$1.37 vs $1.63

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