Gilead profit tops estimates as hepatitis C drug sales surge

(Bloomberg) — Gilead Sciences Inc. (Nasdaq:GILD), maker of the hepatitis C drugs Sovaldi and Harvoni, posted second-quarter profit that topped analysts’ estimates as revenue surged. Gilead raised its sales forecast for the year.

Earnings excluding one-time items rose to $3.15 a share, above analysts’ predictions of $2.71, according to an average of estimates compiled by Bloomberg. Revenue jumped 26 percent to $8.24 billion in the period ended June 30, the Foster City, Calif.-based company said Tuesday in a statement. Analysts had predicted $7.58 billion.

The drugmaker also raised its forecast for the year. Product sales will total $29 billion to $30 billion, Gilead said, up from its previous guidance in April of $28 billion to $29 billion.

Gilead’s hepatitis C drugs have become the top-selling new product in the history of the drug industry. The pills have poured billions of dollars into the company’s coffers, and investors are wondering if Gilead will make a major acquisition to fuel the next phase of its growth.

Gilead’s scientific expertise and strong balance sheet gives the biotech the flexibility to do a range of deals, Chief Operating Officer John Milligan said.

“We could possibly take small deals,” he said Tuesday on a call with analysts. “We could contemplate larger, perhaps even transformative deals.”

The company held $14.7 billion in cash and equivalents at the end of June.

Sovaldi, Harvoni

Sales of Sovaldi totaled $1.29 billion, beating analysts’ estimates of $969 million. Sales of Harvoni, a combination of Sovaldi and another drug called ledipasvir, were $3.61 billion, above estimates of $3.5 billion. The drug sales were helped by uptake in Spain, Italy and Portugal, said Paul Carter, executive vice president of commercial operations.

The drugs offer a cure for hepatitis C, though their list price of more than $1,000 a day has drawn criticism from health insurers, patient groups and lawmakers.