Gilead Sciences Inc. reported first-quarter profit that topped analysts’ estimates as sales of hepatitis C drugs Sovaldi and Harvoni surged. Shares rose in late trading.
Earnings excluding one-time items rose to $2.94 a share from $1.48 a year earlier. Analysts had forecast $2.32 on average, according to estimates compiled by Bloomberg. Revenue increased 52 percent to $7.59 billion, the Foster City, California-based company said Thursday in a statement. Analysts had predicted $6.89 billion.
Sales of Sovaldi and Harvoni combined were $4.55 billion, according to Gilead, topping analysts’ average estimate of $3.61 billion. Harvoni is a combination of Sovaldi and another drug called ledipasvir. The drugs offer a cure for the liver disease, though their price of more than $1,000 a pill before rebates has drawn an outcry from lawmakers and insurers.
The drugmaker also raised its product sales forecast for the year to $28 billion to $29 billion. In February, the company said 2015 sales would be $26 billion to $27 billion.
Gilead shares gained 2.7 percent to $103.20 in extended trading in New York. Through Thursday’s close, they had gained 28 percent in the past year, compared with a 46 percent increase in the Nasdaq Biotechnology Index.
Gilead “tends to be conservative, so for them to raise revenue guidance this early in the year speaks volumes,” Evercore ISI analyst Mark Schoenebaum said in a note to clients.
First-quarter net income almost doubled to $4.33 billion. In the U.S. and Europe, 90,000 patients started treatment on Sovaldi or Harvoni during the first quarter, Gilead said.
Gilead already has moved on to developing the next generation of hepatitis C drugs, reporting on April 23 that a combination of Sovaldi with two experimental drugs lowered the effective treatment time to six weeks, though not four.
While Gilead currently dominates the market, the drugmaker faces stiffer competition from AbbVie Inc. and Merck & Co. Already AbbVie has started a price war after locking in an exclusive deal with Express Scripts Holding Co., the largest pharmacy-benefits manager, and Merck will probably enter the market next year.