Gilead Sciences, Inc.'s Harvoni Will Fast Track: Analyst

Published: Sep 26, 2014

Gilead Sciences’ Harvoni Will Fast Track: Analyst

September 26, 2014

By Riley McDermid, Breaking News Sr. Editor

Gilead Sciences, Inc.'s new drug for the treatment of chronic hepatitis C virus (HCV) Harvoni will continue to see increasing upside for investors as regulators fast-track approval of the drug and it gains European market share, analysts said Friday.

“On Sept. 26, Gilead received a positive opinion from Committee for Medicinal Products for Human Use for an accelerated approval of Sovaldi+ledipasvir (Harvoni) for HCV,” wrote Bret Holley, a biotech analyst for Guggenheim Securities, in a note to investors. “The agency's opinion will now be reviewed by the European Commission, which will very likely lead to broad European Union approval of Harvoni.”

This comes at a perfect time for Gildead, said Holley, despite recent criticism that its other breakthrough Hep-C treatment, Solvaldi, can amount to $84,000 for a full course of treatment.

“Although we do not see the CHMP's positive opinion as a surprise, we believe the timing of the opinion is an incremental positive for Gilead, positioning the company to capture dominant E.U., positioning the company to capture dominant E.U. HCV market share with Harvoni vs. emerging competition,” wrote Holley.

“We expect additional positive Harvoni news flow in the fourth quarter of 2014, led by U.S. approval of the FDC, and we would continue to build positions in Gilead ahead of these events,” he concluded. In related news, Citigroup biotech analyst Yaron Werber said Sovaldi continues its dominance in the Hep-C market, with third quarter 2014 sales tracking at $2.5 billion versus Citi’s $2.6 billion and consensus $2.4 billion.

“We assume that Sovaldi sales will be slightly lower in third quarter 2014 as patients are warehoused for the Sovaldi/Ledipasvir single pill regimen and expect sales to bounce back in fourth quarter 2014 once the Sovaldi/Ledipasvir single pill regimen is approved in October,” wrote Werber in a note.

“We anticipate that Sovaldi could materially exceed our and consensus estimates and believe that posting $13 billion global sales in FY14 is possible,” he wrote. “Sovaldi is exceeding the launches of all previous HepC drugs [including] Incivek, Victrelis, Olysio and Sovaldi launches.”

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