Gilead Sciences Guides Up

January 11, 2021

Gilead Sciences has revised certain elements of its full year 2020 guidance.

Updated Full Year 2020 Guidance

(In millions, except percentages and per share amounts)	Previously Updated October 28, 2020	Updated January 11, 2021
Product Sales	$23,000 - $23,500	$24,300 - $24,350
Product Sales excluding Veklury		$21,500 - $21,525
Veklury		$2,800 - $2,825
Non-GAAP
Product Gross Margin	86% - 87%	~ 86.5%
R&D Expenses	Mid-teens percentage growth	~ 20% growth
SG&A Expenses	Low double-digit percentage growth	~ 10% growth
Operating Income	$10,700 - $11,200	$11,650 - $11,750
Effective Tax Rate	~ 20%	~ 19.0% - 19.5%
Diluted EPS	$6.25 - $6.60	$6.98 - $7.08
GAAP Diluted Earnings (Loss) Per Share	$(0.25) - $0.10	$(0.08) - $0.02

The following provides additional details on the company’s updated guidance:

Gilead delivered solid performance, despite the global impacts of COVID-19.
Total product sales guidance range is now $24.30 billion to $24.35 billion, reflecting increased Veklury^® (remdesivir) sales as hospitalization and treatment rates were higher than expected given the most recent COVID-19 surge.
As a reminder, full year 2020 total product sales excluding Veklury reflects the underlying strong Biktarvy^® (bictegravir 50 mg/emtricitabine 200 mg/tenofovir alafenamide 25 mg) uptake, partially offset by the Truvada^® (emtricitabine 200 mg/tenofovir disoproxil fumarate 300 mg) loss of exclusivity in the United States and the impact of COVID-19 primarily on Gilead’s pre-exposure prophylaxis (“PrEP”) franchise and chronic hepatitis C virus (“HCV”) franchise.
Guidance for Research and development (“R&D”) expense changed to reflect the increase in expense for obligations under the previously disclosed new commercialization and development agreement for Jyseleca^® (filgotinib) with Galapagos NV. In addition, R&D expense for the full year 2020 reflects growth due to higher clinical trial and manufacturing ramp-up expenses related to Gilead’s COVID-19 treatment remdesivir.
Selling, general and administrative (“SG&A”) expense reflects the low-end of Gilead’s previous guidance. As a reminder, SG&A expense grew for the full year 2020 due to a legal accrual related to a previously disclosed legal settlement, expenses associated with the acquisitions of Forty Seven, Inc. and Immunomedics, Inc., and certain remdesivir donations.
GAAP Diluted EPS guidance is ($0.08) to $0.02 and Non-GAAP Diluted EPS guidance is $6.98 to $7.08 for full year 2020.

The updated 2020 guidance range provided in this document is based on Gilead’s preliminary fourth quarter 2020 results, which are subject to change in connection with the completion of the company’s final closing procedures, final adjustments and other developments that may arise in the course of the preparation or audit of its financial statements. Gilead’s management will host a conference call to discuss the company’s fourth quarter and full year 2020 results in the coming weeks.