Q4 2015 Earnings Results - True Cost of Heathcare · Q4 2015 Earnings Results February 2, 2016 ......

Q4 2015 Earnings Results

February 2, 2016

Forward-looking Statements

2

The projected financial results presented in the following slides represent management's estimates of Gilead’s future financial results. Gilead cautions

readers that forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially. These risks and

uncertainties include: Gilead's ability to achieve its anticipated full year 2016 financial results; Gilead's ability to sustain growth in revenues for its antiviral

and other programs; availability of funding for state AIDS Drug Assistance Programs (ADAPs); continued fluctuations in ADAP purchases driven by

federal and state grant cycles which may not mirror patient demand and may cause fluctuations in Gilead's earnings; the possibility of unfavorable results

from clinical trials involving investigational compounds, including GS-5734 and filgotinib; Gilead's ability to initiate clinical trials in its currently anticipated

timeframes; the levels of inventory held by wholesalers and retailers which may cause fluctuations in Gilead's earnings; Gilead's ability to submit new

drug applications for new product candidates in the timelines currently anticipated; Gilead's ability to receive regulatory approvals in a timely manner or at

all, for new and current products, including F/TAF, R/F/TAF and SOF/VEL; Gilead's ability to successfully commercialize its products, including Genvoya;

the risk that physicians and patients may not see advantages of these products over other therapies and may therefore be reluctant to prescribe the

products; the risk that estimates of patients with HCV or anticipated patient demand may not be accurate; the risk that private and public payers may be

reluctant to provide, or continue to provide, coverage or reimbursement for new products, including Sovaldi and Harvoni; Gilead's ability to successfully

develop its oncology, inflammation, cardiovascular and respiratory programs; safety and efficacy data from clinical studies may not warrant further

development of Gilead's product candidates; the potential for pricing pressure from additional competitive HCV launches or austerity measures in

European countries and Japan that may increase the amount of discount required on Gilead's products; Gilead's ability to complete its share repurchase

program due to changes in its stock price, corporate or other market conditions; Gilead’s ability to pay dividends under its dividend program and the risk

that its Board of Directors may reduce the amount of the dividend; fluctuations in the foreign exchange rate of the U.S. dollar that may cause an

unfavorable foreign currency exchange impact on Gilead's future revenues and pre-tax earnings; and other risks identified from time to time in Gilead's

reports filed with the U.S. Securities and Exchange Commission (SEC). In addition, Gilead makes estimates and judgments that affect the reported

amounts of assets, liabilities, revenues and expenses and related disclosures. Gilead bases its estimates on historical experience and on various other

market specific and other relevant assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making

judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ significantly from

these estimates. You are urged to consider statements that include the words may, will, would, could, should, might, believes, estimates, projects,

potential, expects, plans, anticipates, intends, continues, forecast, designed, goal, or the negative of those words or other comparable words to be

uncertain and forward-looking. Gilead directs readers to its press releases, Quarterly Report on Form 10-Q for the quarter ended September 30, 2015

and other subsequent disclosure documents filed with the SEC. Gilead claims the protection of the Safe Harbor contained in the Private Securities

Litigation Reform Act of 1995 for forward-looking statements. All forward-looking statements are based on information currently available to Gilead, and

Gilead assumes no obligation to update any such forward-looking statements.

This presentation includes GAAP and non-GAAP financial measures, a complete reconciliation between these two measures is available on the

Company’s website at www.gilead.com within the investor section. Management believes this non-GAAP information is useful for investors, when

considered in conjunction with Gilead’s GAAP financial statements, because management uses such information internally for its operating, budgeting

and financial planning purposes. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to

supplement an understanding of Gilead’s operating results as reported under U.S. GAAP.

Q4 2015 Earnings Call Agenda

Introduction Patrick O’Brien, VP, Investor Relations

Commentary

Q&A

John Martin, Chairman and CEO

John Milligan, President and COO

Paul Carter, EVP, Commercial Operations

Robin Washington, EVP and CFO

Also:

Norbert Bischofberger, EVP, R&D and CSO

3

Table of Contents

Discussion Slide #

John Martin, Chairman and CEO

John Milligan, President and COO

Key Accomplishments, Pipeline and Milestones 6 – 11

HIV 12 – 14

HBV 15 – 16

HCV 17 – 18

Paul Carter, EVP, Commercial Operations

Product Performance 20 – 23

HCV Performance 24 – 30

HIV Performance 31 – 39

Robin Washington, EVP and CFO

Income Statement Performance 40 – 46

Cash Flows and Return of Capital to Shareholders 47 – 50

2016 Guidance 51 – 52

Appendix 53 – 65

4

John F. Milligan, Ph.D.

President and COO

Key Accomplishments in 2015

HIV

─ Genvoya approved in the U.S. and EU and added to the DHHS treatment guidelines

─ U.S. and EU regulatory submissions for R/F/TAF and F/TAF

─ Initiated Phase 3 program for GS-9883/F/TAF

HCV

─ More than 770k patients treated worldwide with sofosbuvir-containing regimens from

Dec 2013 through Dec 2015

─ Harvoni and Sovaldi approved and launched in Japan

─ U.S. and EU regulatory submissions for the pan-genotypic regimen of SOF/VEL (U.S.

Priority Review granted, PDUFA June 28, 2016)

Corporate

─ Record revenue and EPS

─ Initiated quarterly dividend program

─ Significant shareholder return

o Announced new $15 billion repurchase program

o Repurchased ~$10.0 billion of stock (~95 million shares)

o Completed early retirement of 46 million warrants for $3.9 billion 6

HIVF/TAF (emtricitabine/tenofovir alafenamide) U.S. and EU Regulatory Submission

STR of rilpivirine/FTC/TAF U.S. and EU Regulatory Submission

GS-9883 (non-boosted integrase inhibitor)/FTC/TAF

GS-9620 (TLR-7 agonist)

Liver DiseasesHCV

STR of SOF/VEL* (pan-genotypic NS5B/NS5A inhibitors) U.S. and EU Regulatory Submission

SOF/VEL/GS-9857 (pan-genotypic NS3 protease inhibitor)

HBV

TAF (nucleotide reverse transcriptase inhibitor) U.S. Regulatory Submission

GS-4774 (Tarmogen T cell immunity stimulator)

GS-9620 (TLR-7 agonist)

NASH/Other Liver Diseases

Simtuzumab (monoclonal antibody) - Primary Sclerosing Cholangitis

Simtuzumab (monoclonal antibody) - NASH

GS-4997 (ASK-1 inhibitor) - NASH

GS-4997 + Simtuzumab - NASH

GS-9674 (FXR Agonist) - NASH

CardiovascularEleclazine** (late sodium current inhibitor) - LQT-3 Syndrome

GS-4997 (ASK-1 inhibitor) - PAH

Eleclazine (late sodium current inhibitor) - Hypertrophic Cardiomyopathy

Eleclazine (late sodium current inhibitor) - Ventricular Tachycardia/Ventricular Fibrillation

*Velpatasvir is abbreviated VEL and was formerly called GS-5816.

**Formerly called GS-6615.

1 2 3

Regulatory

Submissions

Phase

Pipeline Product Candidates

7

Pipeline Product Candidates (continued)

8

Hematology/Oncology

Idelalisib (PI3K delta inhibitor) - Frontline and Relapsed Refractory CLL

Idelalisib (PI3K delta inhibitor) - Relapsed Refractory iNHL

Momelotinib (JAK inhibitor) - Myelofibrosis

Momelotinib (JAK inhibitor) - Pancreatic Cancer

GS-5745 (MMP9 mAb inhibitor) - Gastric Cancer

Idelalisib (PI3K delta inhibitor) - Frontline iNHL

Entospletinib (Syk inhibitor) - Hematological Malignancies

GS-4059 (BTK inhibitor) - B-cell Malignancies

GS-5745 (MMP9 mAb inhibitor) - Solid Tumors

GS-5829 (BET inhibitor) - Solid Tumors

Inflammation/Respiratory

GS-5745 (MMP9 mAb inhibitor) - Ulcerative Colitis

Presatovir* (fusion inhibitor) - Respiratory Syncytial Virus

Filgotinib (JAK1 inhibitor) - Rheumatoid Arthritis

Filgotinib (JAK1 inhibitor) - Crohn's Disease

GS-5745 (MMP9 mAb inhibitor) - Crohn's Disease

GS-5745 (MMP9 mAb inhibitor) - COPD

GS-5745 (MMP9 mAb inhibitor) - Rheumatoid Arthritis

GS-9876 (Syk inhibitor) - Rheumatoid Arthritis

Other

GS-4997 (ASK-1 inhibitor) - Diabetic Nephropathy

GS-5734 (Nuc inhibitior) - Ebola

Phase Regulatory

Submissions1 2 3

*Formerly called GS-5806.

HIV

TAF

Q4 15

Q1 16

Q2 16

Q3 16

U.S. FDA and European Commission approval of E/C/F/TAF

Approval of R/F/TAF in the U.S. (PDUFA March 1)

Approval of F/TAF in the U.S. (PDUFA April 7) and in the EU

Approval of R/F/TAF in the EU

GS-9883/F/TAF 1H 17 Achieve 48-week endpoint in Phase 3 studies in treatment-naïve

and switch patients

GS-9620 1H 16 Complete Phase 1 study in HIV cure

9

Significant Pipeline Milestones Anticipated in 2016 - 2017

Cardiovascular

GS-4997 Q3 16 Complete 24-week period of Phase 2 study in PAH

Eleclazine

Q2 16

2H 16

1H 17

1H 17

Complete enrollment of Phase 2 studies in VT/VF and HCM

Complete enrollment of Phase 3 study in LQT-3 syndrome

Complete Phase 2 studies in VT/VF and HCM

Complete Phase 3 study in LQT-3 syndrome

Other

GS-4997 Q4 16 Complete Phase 2 study in diabetic kidney disease

10

Significant Pipeline Milestones Anticipated in 2016 - 2017 (Continued)

HBV

TAF

Q4 15

Q1 16

Q1 16

Top line data from Phase 3 studies

Submitted U.S. NDA

Submit EU MAA

GS-9620

Q4 15

Q1 16

Q4 16

Initiate Phase 2 study in treatment-naïve patients

Complete Phase 2 study in virally suppressed patients

Complete Phase 2 study in treatment-naïve patients

NASH

Simtuzumab Q4 16 Complete Phase 2 study

GS-4997 Q3 16 Complete Phase 2 study

GS-9674 Q1 16 Initiate Phase 1 study

HCV

LDV/SOF Q1 16 Label update for decompensated cirrhotics and post-transplant

patients (PDUFA February 26)

SOF/VEL/GS-9857 Q4 16 Complete Phase 3 studies (initiated in Q4 2015)

SOF/VEL

Q4 15

Q2 16

Q3 16

Submit U.S. NDA and EU MAA

Approval in the U.S. (PDUFA June 28)

Approval in the EU

11

Hematology/Oncology

Idelalisib

Q2 16

Q2 16

Q4 16

Interim data from Phase 3 study for previously treated iNHL w/bendamustine

+ rituximab

Submit sNDA for combination use with bendamustine + rituximab in previously

treated CLL patients

Interim data from Phase 3 study for CLL frontline w/bendamustine + rituximab

Momelotinib

Q2 16

1H 17

Complete enrollment in Phase 3 studies vs ruxolitinib and best available

treatment for myelofibrosis

Interim data from Phase 3 study for previously untreated pancreatic cancer

w/gemcitabine + Abraxane

GS-5745 1H 17 Interim data from Phase 3 study for gastric cancer

Significant Pipeline Milestones Anticipated in 2016 - 2017 (Continued)

Inflammation/Respiratory

Filgotinib 2H 16 Initiate Phase 3 studies in RA and Crohn’s Disease

GS-5745

Q2 16

Q3 16

Q4 16

Q4 16

Complete enrollment in Phase 2 study for Crohn’s Disease

Initiate Phase 2 studies in RA, CF, and COPD

Complete enrollment in Phase 2/3 study for ulcerative colitis

Complete Phase 2 study for Crohn’s Disease

Presatovir (formerly GS-5806)

Q4 16 Complete RSV Phase 2 studies in adults with infection in upper or lower

respiratory tracts

GS-9876 2H 16 Initiate Phase 2 study in RA

Entospletinib 1H 16 Initiate Phase 2 study in GVHD

HIV

GS-9883

─ A novel once daily unboosted integrase inhibitor (50mg), combined

with F/TAF represents the smallest HIV STR pill size

─ Phase 3 studies for GS-9883/F/TAF initiated in Q4 2015

13

Innovation in HIV Continues with GS-9883

Adult Switch from

ABC/DTG/3TC

(n = 520)

Adult Switch from

Boosted PI (DRV or ATV)

(n = 520)

Adult Tx-Naïve

GS-9883/F/TAF vs ABC/DTG/3TC

(n=600)

Adult Tx-Naïve

GS-9883/F/TAF vs DTG + F/TAF

(n=600)

F/TAF

─ U.S. PDUFA date April 7, 2016

─ EU MAA submitted in April 2015

R/F/TAF

─ U.S. PDUFA date March 1, 2016

─ EU MAA submitted in July 2015

D/C/F/TAF (darunavir/cobicistat/F/TAF) will be developed and

commercialized by Janssen

─ First STR containing a protease inhibitor

14

Additional TAF-Based Regimens Pending Approval

and Under Development

HBV

TAF is non-inferior to Viread

─ Study 108 (HBeAg-negative patients): 94.0% of TAF patients compared to 92.9% of Viread patients

─ Study 110 (HBeAg-positive patients): 63.9% of TAF patients compared to 66.8% of Viread patients

Higher rates of ALT normalization

The median change in estimated glomerular filtration rate (eGFR) from

baseline to week 48 favored TAF in both studies (p<0.01)

Statistically significant smaller mean percentage decrease from baseline in

hip and spine bone mineral density compared to Viread patients

U.S. NDA submitted on January 12, 2016 and EU MAA submission

planned for Q1 2016

16

TAF for HBV Top Line Results from Phase 3 Studies

HCV

SOF/VEL (sofosbuvir/velpatasvir)

─ Once-daily pan-genotypic single tablet regimen

─ Four Phase 3 studies

─ U.S. NDA filed in October 2015 (Priority Review, PDUFA June 28, 2016)

and EU MAA validated in December, 2015 (Accelerated Assessment)

ASTRAL-2 ASTRAL-1

18

Genotype

1, 2, 4-6

ASTRAL-3

Genotype 3

SVR12

95%

Genotype 2

SVR12

99%

Gilead's Evolving HCV Portfolio

SVR12

99%

ASTRAL-4

Genotype 1-6

w/Child-Pugh

class B

SVR12

94%*

*When taken with ribavirin.

Paul Carter

EVP, Commercial Operations

$7,222 $7,405

$8,126 $8,211 $8,409

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$10,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Mil

lio

ns

)

Total Product Sales

20

Q4 2015 up 16% from Q4 2014

Q4 2015: $8,409 (16% YoY Growth)

21 Note: Amounts may not sum due to rounding.

Europe: $1,680

(20% of Total)

(22% YoY Growth)

U.S.: $4,792

(57% of Total)

(-12% YoY Growth)

Other International

(including Japan): $1,937

(23% of Total)

(419% YoY Growth)

Product Sales by Geography (in millions, except percentages)

FX impact to European revenues was unfavorable $34 million

QoQ and unfavorable $150 million YoY

22

Q4 2015 up 22% (32% excluding FX) from Q4 2014

European Product Sales

Q4'15 Q4'14 YoY Excl FX

Atripla $161 $194 (17%) (10%)

Eviplera $149 $138 8% 19%

Stribild $83 $52 60% 76%

Truvada $272 $287 (5%) 3%

Viread $77 $77 0% 10%

Sovaldi $259 $459 (44%) (38%)

Harvoni $587 $83 NM NM

AmBisome $58 $67 (13%) (6%)

Other $34 $24 42% 54%

Total $1,680 $1,381 22% 32%

$5

,08

6

$4

,89

9

$5

,20

3

$5

,18

2

$4

,36

9

$1

,29

7

$1

,74

8

$1

,89

4

$1

,59

0

$1

,59

5

$343 $341

$534 $930 $1,922

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(in

Mil

lio

ns

)

U.S. Europe Other International

Key Metrics

U.S.:

● Inventory levels for HIV

products at the Big-3

wholesalers ended at the

high-end of the inventory

management agreement

range

Europe:

● Sequentially flat primarily

driven by stabilization of

patient demand in earlier

launch markets

Other International:

● Sequential growth driven by

HCV uptake in Japan ($1.4

billion in sales in Q4 15)

Antiviral Product Sales

23

$6,726

Q4 2015 up 17% from Q4 2014

Note: Q4 14 EU Antiviral products sales were negatively impacted by new tax legislation in France

associated with HCV and Italian spending rebates.

$6,988

$7,631 $7,702 $7,886

HCV

$1

,73

2

$9

72

$1

,29

1

$1

,46

6

$1

,54

7

$2

,10

7

$3

,57

9

$3

,60

8

$3

,33

2

$3

,34

5$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(in

Mil

lio

ns

)

Sovaldi Harvoni

Key Metrics

● Increase in Sovaldi sales

from Q3 15 driven primarily

by uptake in Japan

(launched May 25th)

● Harvoni launched in Japan

in Q3 15 (September 1st)

● In Q4 15, approximately

47,000, 28,000 and 35,000

patient starts with a Gilead

HCV regimen in the U.S.,

Europe and Japan,

respectively

Total HCV Product Sales

25

$3,839

Q4 2015 up 27% from Q4 2014

$4,551

$4,899 $4,798 $4,892

Q4 2015: $4,892 (27% YoY Growth)


Europe: $846

(17% of Total)

(56% YoY Growth)

U.S.: $2,367

(48% of Total)

(-26% YoY Growth)

Other International


(34% of Total)

Total HCV Sales by Geography (in millions, except percentages)

The Number of Patients Receiving a Sofosbuvir-Based Regimen Increased Significantly in 2015

27

Patients Treated with a SOF-based Regimen (in thousands)

Note: Graph illustrates the estimated number of patients treated with a Gilead HCV drug for each year. Patient numbers are subject to adjustments. Rest of

World is comprised primarily of Egypt and Pakistan.

Sovaldi was approved in the U.S in December 2013 and in the EU in January 2014. Harvoni was approved in the U.S. in October 2014 and in the EU in

November 2014. In Japan, Sovaldi launched in May 2015 and Harvoni launched in September 2015.

142

236

32

113

49

15

185

2

189

583

2013 2014 2015

Rest of World

Japan

Europe

U.S.

HCV Prevalence

Global Prevalence of HCV Estimated to Be 185 Million(1)

Sources: 1) WHO Guidelines for the Screening, Care, and Treatment of Persons with Hepatitis C Infection, April 2014 2) Gilead Forecast (2011

prevalence estimate). 3) Cornberg, Sievert, and Kershenobich, et al. 2011. Country populations from 2009 World Bank estimates.

Core Markets(2) Emerging Markets(3)

Region US Europe

Big-5

Japan Europe

Other

Asia

Other

Latin

America

All Genotypes

(Millions)

4.0 2.6 1.1 6.7 70.8 5.4

Genotype 1 (%) 79% 63% 67% 65% 39% 68%

<1%

1-1.9%

2-2.9%

>3%

Not tested

HCV Prevalence

28

F0-F2, 50%

F3-F4, 50%

GT 1, 80%

GT 2, 12%

GT 3, 7%

Profile of U.S. HCV Patients that are Intended for Treatment with a Sofosbuvir-based Regimen (October – Dec 2015*)

29

Genotype Fibrosis Score

Patient Type

Treatment

Naïve,

85%

Treatment

Experienced,

15%

Note:

Fibrosis score is based on the METAVIR scoring system.

‘Intended for treatment’ is based on scripts written, not scripts filled.

*Data Source: Gilead market research Oct 1 – Dec 6, 2015.

Other,

1%

30

Simplifying and Advancing the Treatment for HCV Cures

®

$5.3 billion in worldwide sales in 2015

─ $2.4 billion in sales in the U.S.

─ $1.6 billion in sales in Europe

─ $878 million in sales in Japan

$13.9 billion in worldwide sales in 2015

─ $10.1 billion in sales in the U.S.

─ $2.2 billion in sales in Europe

─ $1.0 billion in sales in Japan

sNDA approved in the U.S. for GT-4, 5 & 6 and

co-infected HIV patients. 12-week usage with

ribavirin can be considered for treatment-

experienced GT-1 patients with cirrhosis Note: Japan: Sovaldi is approved for GT-2 and Harvoni for GT-1 patients.

EU: Harvoni is approved for GT-1-2 , 3 (certain subgroups) , 4-6 patients.

HIV

U.S. HIV Market Dynamics

0

200

400

600

800

1,000

1,200

1,400

HIV Infected Diagnosed On Antiretroviral

Treatment

On a Gilead HIV

Product

(Es

tim

ate

d P

ati

en

ts i

n 0

00

's) ~1,218

~1,062

~757

~584

Up 5%^

~87%

~71%

~77%

Sources:

• CDC and Ipsos Healthcare U.S. HIV Monitor Q3 2015.

• ^Growth rate calculated as MAT (moving annual total).

32

Gilead U.S. Share in HIV Treatment Naïve Patients

Base: All initiations within each quarter.

Source: Ipsos Healthcare HIV U.S. Scope Q3 2015.

33

Top Prescribed HIV Regimens

34

Rank Naïve All Patients

1 Stribild Atripla

2 Other STR Stribild

3 Complera Complera

4 Atripla Other STR

5 Truvada + other 3rd

Agent

Truvada + other 3rd

Agent

Gilead STR

U.S. Europe Big-5

Rank Naïve All Patients

1 Eviplera Atripla

2 Stribild Eviplera

3 Other STR Stribild

4 Truvada + other 3rd

Agent

Truvada + other 3rd

Agent

5 Atripla Other STR

EU Naïve Source: Ipsos Healthcare HIV EU Scope Q3 2015.

EU All Patient Source: Ipsos Healthcare HIV EU Monitor Q3 2015.

US Naïve Source: Ipsos Healthcare HIV U.S. Scope Q3 2015.

US All Patient Source: Ipsos Healthcare HIV U.S. Monitor Q3 2015.

35

U.S.

Approved by the FDA on November 5, 2015

Added to the “Recommended” category in

the DHHS guidelines 13 days post-approval

$44 million in sales in Q4 2015

Genvoya: The First TAF-Containing HIV Single Tablet Regimen

Europe

Approved by the European Commission on

November 23, 2015

Preferred in the guidelines of Spain, Italy, and

Denmark prior to reimbursement

Pricing and reimbursement process is ongoing

and could take up to 12 months to complete

$3

19

$2

82

$3

64

$4

22

$4

08

$5

2

$6

1

$6

5

$7

3

$8

3$0

$100

$200

$300

$400

$500

$600

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Millio

ns)


Key Metrics*

U.S.:

● Captured 30% of naïve HIV

patient share

● Number two most prescribed

HIV regimen across all

treated patients

Europe:


patient share in Big-5

● Number two most prescribed

HIV regimen in naïve patients

● Launched in Big-5 as well as

eighteen additional countries

*Sources:

U.S. data from Ipsos Healthcare HIV U.S. Therapy Monitor

Q3 2015 & Ipsos Healthcare HIV U.S. Scope Q3 2015.

EU data from Ipsos Healthcare HIV EU Scope Q3 2015.

Note: Stribild is indicated for the treatment of HIV-1

infection in antiretroviral treatment naïve patients.

36

Stribild Product Sales

$385

Q4 2015 up 33% from Q4 2014

$356

$447

$511 $511

$1

96

$1

63

$2

07

$2

10

$2

16

$1

38

$1

45

$1

45

$1

37

$1

49

$0

$100

$200

$300

$400

$500

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Millio

ns)


Key Metrics*

U.S. (Complera):


patient share

● Third most prescribed HIV

regimen across all patients

Europe (Eviplera):


patient share in Big-5

● Preferred status in Big-5

*Sources:



EU data from Ipsos Healthcare HIV EU Scope Q3 2015.

Note: In Spain, Eviplera is preferred in patients with a

baseline viral load <100,000 copies/mL.

Complera/Eviplera Product Sales

37

$348

Q4 2015 up 9% from Q4 2014

$320

$367 $360 $380

$5

48

$4

09

$5

00

$5

61

$5

87

$2

87

$3

01 $

27

7 $2

68

$2

72

$0

$250

$500

$750

$1,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Millio

ns)


Key Metrics*

U.S.:

● Used by 27% of all

treated HIV patients

● Used by 16% of naïve

HIV patient share

Europe:

● Most prescribed HIV

product with 29% of all

treated patients

● Captured 28% of naïve

HIV patient share

*Sources:



EU data from Ipsos Healthcare HIV EU Therapy Monitor

Q3 2015 & Ipsos Healthcare HIV EU Scope Q3 2015.

38

Truvada Product Sales

$897

Q4 2015 up 4% from Q4 2014

$771

$849

$903 $936

$6

68

$4

94

$5

49

$5

97

$5

82

$1

94

$1

94

$1

78

$1

61

$1

61

$0

$250

$500

$750

$1,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Millio

ns)


Atripla Product Sales

Key Metrics*

U.S.:

● Most prescribed HIV regimen

with 20% of all treated

patients


patient share

Europe:

● Most prescribed HIV regimen

with 16% of all treated

patients


patient share**

*Sources:



EU data from Ipsos Healthcare HIV EU Therapy Monitor Q3

2015 & Ipsos Healthcare HIV EU Scope Q3 2015.

**Note: In the EU Atripla does not have an indication for the

treatment of naïve patients and there is no Atripla

promotion concerning treatment naïve patients.

Note: Efavirenz (the active pharmaceutical component in Atripla purchased

from Bristol-Myers Squibb) accounted for approximately 37% of Atripla sales

in Q4 2015 which represented $295 million to be paid to BMS. 39

$925

Q4 2015 down 14% from Q4 2014 (Downgraded in DHHS guidelines)

$734

$782 $818 $800

Robin Washington

EVP and Chief Financial Officer

Financial Highlights: Q4 2015 (in millions, except percentages and per share amounts)

* Other Products comprised primarily of Letairis, Ranexa, AmBisome, Zydelig, Cayston and Lexiscan.

**Non-GAAP costs and expenses, net income and diluted EPS exclude amounts related to acquisition, stock-based compensation and other.

***Q4 14 includes $265 million of one-time items for collaboration related expenses and purchase of a FDA Priority Review Voucher.

41

Q4 2014 Q4 2015 % Change

Net Product Sales $7,222 $8,409 16%

Antiviral Products 6,726 7,886 17%

HCV 3,839 4,892 27%

HIV and Other Antiviral 2,887 2,994 4%

Other Products* 496 523 5%

Non-GAAP Costs and Expenses** $2,545 $2,649 4%

COGS 847 857 1%

Product Gross Margin 88% 90%

R&D*** 899 779 (13%)

SG&A 799 1,013 27%

Operating Margin 65% 69%

Non-GAAP Net Income** $3,883 $4,889 26%

Non-GAAP Diluted EPS** $2.43 $3.32 37%

Financial Highlights: Fiscal Year (in millions, except percentages and per share amounts)

* Other Products comprised primarily of Letairis, Ranexa, AmBisome, Zydelig, Cayston and Lexiscan.

**Non-GAAP costs and expenses, net income and diluted EPS exclude amounts related to acquisition, stock-based compensation and other.

42

FY 2014 FY 2015 % Change

Net Product Sales $24,474 $32,151 31%

Antiviral Products 22,791 30,207 33%

HCV 12,410 19,140 54%

HIV and Other Antiviral 10,381 11,067 7%

Other Products* 1,683 1,944 16%

Non-GAAP Costs and Expenses** $8,306 $9,244 11%

COGS 2,964 3,175 7%

Product Gross Margin 88% 90%

R&D 2,585 2,845 10%

SG&A 2,757 3,224 17%

Operating Margin 67% 72%

Non-GAAP Net Income** $13,314 $19,174 44%

Non-GAAP Diluted EPS** $8.09 $12.61 56%

$2.43

$2.94

$3.15$3.22

$3.32

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

Non-GAAP Diluted EPS

43

Note: Non-GAAP diluted EPS excludes amounts related to acquisition, stock-based compensation and other.

Q4 2015 up 37% from Q4 2014

$702 $713

$779

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Mil

lio

ns

)

R&D One-time items

Non-GAAP R&D Expenses

Note: Non-GAAP R&D expenses exclude amounts related to acquisition, stock-based

compensation and other.

Key Metrics

● Higher R&D expenses in

Q4 15 over Q4 14

(excluding one-time items)

primarily driven by the

continued progression of

clinical studies

44

$899

Q4 2015 up 23% from Q4 2014

(excluding one-time items)

$265 *

* One-time items of $265 million for collaboration related expenses and purchase of a FDA

Priority Review Voucher.

$651

$761

$850

$1,013

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

$1,100

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Millio

ns)

45

Non-GAAP SG&A Expenses

Note: Non-GAAP SG&A expenses exclude amounts related to acquisition, stock-based


Q4 2015 up 27% from Q4 2014

* Q1 15 is favorably impacted by prior year adjustments of $101 million following receipt of

2015 IRS invoice.

Key Metrics

● Higher SG&A expenses in

Q4 15 compared to Q4 14

primarily due to higher

costs to support growth and

the geographic expansion

of the business

● P&L impact of the

estimated Branded

Prescription Drug (BPD)

fee:

$600

$799

*

$M

2014 BPD Fee $587

2015 BPD Fee $414

2016 BPD Range $550-650

Non-GAAP Effective Tax Rate

46

Note: Non-GAAP Effective Tax Rate excludes amounts related to acquisition, stock-based


• The decrease from Q3 2015 is primarily due to the Q4 2015 cumulative catch-up

for the permanent extension of the Federal research tax credit and the increase in

HCV product revenue.

Q1 2015 Q2 2015 Q3 2015 Q4 2015 FY 2015

Non-GAAP Effective

Tax Rate 16.9% 17.7% 16.3% 13.9% 16.2%

$3,021

$5,701 $5,658

$4,097

$4,874

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Millio

ns)

Operating Cash Flows

47

Key Drivers

● Increase primarily due to

collections partly offset by

the timing of cash payments

related to current liabilities

Return of Capital to Shareholders - 2015

Cash dividend program

- Paid quarterly dividend in Q4 2015 of $0.43 per share

- Declared Q1 2016 quarterly dividend of $0.43 per share, payable on March 30,

2016 to stockholders of record as of the close of business on March 16, 2016

Share repurchase program

- Repurchased $3.1 billion of stock (29.3 million shares) at an average price of

$103.94 during the fourth quarter

- $8 billion of the January 2015 share repurchase program ($15 billion

authorization) remaining as of December 31, 2015

Warrants repurchase

- In Q2 2015, paid $3.9 billion for early redemption of 46 million warrants related to

the 2016 convertible bonds at an average stock price of $113.96

- The transaction reduced fully diluted shares outstanding by 32 million shares

(inclusive of the 7 million and 25 million share reduction in Q2 and Q3 2015

respectively)

- Approximately 9 million warrants outstanding as of December 31, 2015

48

49 * Excludes commissions

** Based on average warrant strike price of $29.93

2015 Share Activity

~77% of free cash flow was returned (inclusive of dividend and warrant settlements)

during the period from January 2010 through December 2015

• As of March 31, 2015, we completed the $5 billion share repurchase plan authorized in May 2014. Under the program, we repurchased 48.8

million shares with an average purchase price of $102.36 per share.

• $15 billion share repurchase program was authorized in January 2015 and commenced in April 2015. Under this program, we repurchased 65.7

million shares with an average purchase price of $106.50 per share. The remaining authorization is $8.0 billion as of December 31, 2015.

• As of June 30, 2015, we completed an early retirement of 46 million warrants (related to the 2016 convertible bonds) at an average stock price of

$113.96 per warrant for approximately $3.9 billion. The repurchased warrants were not part of the January 2015 share repurchase authorization.

There are approximately 9 million 2016 warrants outstanding as of December 31, 2015 and maturing in Q3 2016.

Type of Activity Dollar Amount

(In Millions)

Shares /

Warrants

Average

Purchase Price

Q1 2015 Open Market

Share Repurchase* $3,000 29,593,030 $101.38

Q2 2015 Open Market

Share Repurchase* $900 8,811,676 $102.14

Q2 2015 Warrant Repurchase** $3,865 46,000,000 $113.96

Q3 2015 Open Market


Q4 2015 Open Market


2015 Total Open Market


Update to Capital Allocation Plan - 2016

Cash dividend program

- Quarterly dividend increase of 10% from $0.43 to $0.47 per share

- Beginning in the second quarter of 2016, subject to declaration by the Board

of Directors

$12 billion share repurchase program authorized

- To be utilized upon completion of the $15 billion January 2015 repurchase

program which had $8 billion remaining as of December 31, 2015

- Intend to utilize a portion of the remaining January 2015 program to enter

into a $5 billion accelerated share repurchase (ASR) program in the near

term and expect to complete the ASR in approximately three months

50

Provided 2/2/2016

Net Product Sales* $ 30,000 – $ 31,000

Non-GAAP**

Product Gross Margin 88% – 90%

R&D Expenses $ 3,200 – $ 3,500

SG&A Expenses $ 3,300 – $ 3,600

Effective Tax Rate 18.0% – 20.0%

Diluted EPS Impact of

Acquisition-Related and

Stock-Based Compensation

Expenses

$ 1.10 – $ 1.16

*This guidance is subject to a number of uncertainties, including, but not limited to, inaccuracy in our estimates of HCV patient starts, a larger than anticipated shift

in payer mix to more highly discounted payer segments – such as PHS, FSS, Medicaid and the VA, the potential adoption in Europe and other countries of

additional pricing measures to reduce HCV spending, the pricing and acceptance of competing products and the potential for continued volatility in foreign currency

exchange rates.

**Non-GAAP product gross margin, expenses and effective tax rate exclude amounts related to acquisition, stock-based compensation and other.

Full Year 2016 Guidance (in millions, except percentages and per share amounts)

51

Projected product gross margin GAAP to non-GAAP reconciliation:

GAAP projected product gross margin

Acquisition related-expenses

Non-GAAP projected product gross margin*

Projected research and development expenses GAAP to non-GAAP reconciliation:

GAAP projected research and development expenses

Acquisition related / upfront collaboration expenses

Stock-based compensation expenses

Non-GAAP projected research and development expenses

Projected selling, general and administrative expenses GAAP to non-GAAP

reconciliation:

GAAP projected selling, general and administrative expenses

Acquisition related-expenses

Stock-based compensation expenses

Non-GAAP projected selling, general and administrative expenses

Projected diluted EPS impact of acquisition-related, stock-based compensation and

other:

Acquisition related / upfront collaboration expenses

Stock-based compensation expense

Projected diluted EPS impact of acquisition-related, stock-based compensation and other

Provided on 2/2/2016

(in millions, except percentages and per share amounts)

GAAP to Non-GAAP Reconciliation of Full Year 2016 Guidance

85% - 87%

3% - 3%

88% - 90%

$3,530 - $3,840

-

(230) - (240)

$3,300 - $3,600

$0.88 - $0.92

0.22 - 0.24

$1.10 - $1.16

$3,837 - $4,182

(447) - (477)

(190) - (205)

$3,200 - $3,500

*Stock-based compensation expenses have a less than one percent impact on non-GAAP projected product gross margin 52

Appendix Slides

Gilead's Efforts to Increase Global Access

HIV and HCV Generic Licensing

─ Entered into licensing agreements for HIV with eight India-based generic

manufacturers in 2006

─ Announced non-exclusive licensing agreements for HCV with eleven India-

based generic manufacturers in 2014 and 2015

o Includes Sovaldi and Harvoni

o For distribution in 101 developing countries, where more than 100 million

people estimated living with HCV

Medicines Patent Pool (MPP)

─ Announced new agreement with MPP to expand access to the investigational

drug TAF for HIV and HBV, contingent on U.S. regulatory approval

─ MPP can sub-license TAF to generic drug companies who may manufacture

and distribute in 112 developing countries

Gilead’s Access Operations & Emerging Markets

─ Combined access efforts reached ~8 million HIV patients in low and middle-

income countries

54

$7,314$7,594

$8,244 $8,295 $8,506

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$10,000

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Mil

lio

ns

)

Total Revenues

55

Q4 2015 up 16% from Q4 2014

Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 FY 2015

%

Change

from

Q4 2014

Viread $311 $234 $271 $297 $306 $1,108 (2)%

Letairis $181 $151 $176 $181 $192 $700 6%

Ranexa $144 $117 $141 $161 $169 $588 17%

AmBisome $104 $85 $103 $88 $74 $350 (29%)

Genvoya - - - - $45 $45 NM

Zydelig $17 $26 $30 $36 $40 $132 135%

Other* $50 $38 $45 $43 $48 $174 (4)%

56

Select Product Sales (in millions)

*Other comprised primarily of Cayston and Lexiscan.

FY 2015: $19,140 (54% YoY Growth)


Europe: $3,820

(20% of Total)

(132% YoY Growth) U.S.: $12,478

(65% of Total)

(19% YoY Growth)

Other International


(15% of Total)

Total HCV Sales by Geography (in millions, except percentages)

$18

$116

$60

$9$26

$74

$73

$58

$75

$71

$0

$25

$50

$75

$100

$125

$150

$175

$200

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

(In

Mil

lio

ns

)

Tamiflu Other

Total Royalty, Contract and Other Revenues

58

$92

Q4 2015 up 5% from Q4 2014

$189

$118

$84

$97

88.3%90.9% 90.3% 89.6% 89.8%

0%

25%

50%

75%

100%

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

Non-GAAP Product Gross Margin

Note: Non-GAAP product gross margin excludes amounts related to acquisition,

stock-based compensation and other.

59

Key Metrics

● Higher Non-GAAP

Product Gross Margin

Q4 15 over Q4 14

driven primarily by

favorable product mix

65.2%

74.7% 72.7% 70.8% 68.9%

0%

25%

50%

75%

100%

Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

Non-GAAP Operating Margin

Note: Non-GAAP operating margin excludes amounts related to acquisition,

stock-based compensation and other.

60

Key Metrics

● Higher Non-GAAP

Operating Margin in

Q4 15 over Q4 14 driven

primarily by:

- Higher gross margin from

favorable product mix

- Lower operating expense

growth than revenue

growth

GAAP to Non-GAAP

Diluted Earnings Per Share Reconciliation

Q1 2015 Q2 2015 Q3 2015 Q4 2015 FY 2015

GAAP Diluted EPS $2.76 $2.92 $3.06 $3.18 $11.91

All Acquisition-Related

Expenses $0.13 $0.18 $0.13 $0.14 $0.57

Stock-Based

Compensation Expenses $0.04 $0.05 $0.03 $0.05 $0.17

Other* $0.00 $0.00 ($0.01) ($0.04) ($0.04)

Non-GAAP Diluted EPS $2.94 $3.15 $3.22 $3.32 $12.61

61

* Amounts related to consolidation of a contract manufacturer, contingent consideration and/or other individually insignificant amounts.

Note: Amounts may not sum due to rounding.

Outstanding Debt

*Debt amount shown at face value.

Total interest expense and amortization from all issued debt is expected to be approximately $216 million per

quarter and $864 million for full year 2016.

62

(in billions)

Mar. 31,

2015

Jun. 30,

2015

Sep. 30,

2015

Dec. 31,

2015

Senior Unsecured Notes $11.95 $11.95 $21.95 $21.95

Convertible Notes $0.45 $0.36 $0.34 $0.29

Total Debt* $12.40 $12.31 $22.29 $22.24

Debt to GAAP EBITDA ~0.66x ~0.62x ~1.01x ~0.95x

63

Dilution from Outstanding Convertible Notes

2016

Notes

Total

Dilution

Average share price

Q4 2015 $104.05; FY 2015 $106.53

Convertible Notes(1) (Current Outstanding)

$285M

Conversion Price (2) $22.44

Q4 2015 Share Dilution 11.2M 11.2M

YTD Share Dilution 13.6M 13.6M

Warrants (3)

(Current Outstanding) 9.1M

Warrant Exercise Price (2) $28.76

Q4 2015 Share Dilution 6.5M 6.5M

YTD Share Dilution 20.7M 20.7M

Total Q4 2015 Dilution from

Convertible Notes and Warrants(4) 17.7M

(1) At issuance, the amount outstanding on the 2016 convertible notes was $1.25 billion.

(2) Conversion and warrants exercise price post-dividend are $22.44 (convertible notes) and $28.76 (warrants); pre-dividend prices were $22.53 (convertible notes) and

$29.19 (warrants), respectively.

(3) At issuance, there were 55 million warrants outstanding. During Q2 2015, 46 million warrants were redeemed early (55 million – 46 million = 9 million warrants).

(4) Represents 1.2% diluted non-GAAP shares outstanding.

Other Selected Financial Information (in millions, except days sales outstanding)

Sep. 30,

2015

Dec. 31,

2015

Cash, Cash Equivalents & Marketable Securities $25,114 $26,208

Inventories $1,988 $1,955

Days Sales Outstanding (Accounts Receivable) 48 50

Share Repurchases During the Quarter* $3,050 $3,050

Interest Expense and

Other Income (Expense), net ($113) ($184)

Diluted Shares Used in Per Share Calculation for the Quarter

(Non-GAAP) 1,502 1,472

Diluted Shares Used in Per Share Calculation for the Quarter

(GAAP) 1,503 1,472

Basic Shares Outstanding 1,463 1,436

64

*Excludes commissions. The Q4 15 repurchases were executed under the January 2015 share repurchase authorization. The remaining

authorization is $8.0 billion as of 12/31/2015.

Q4 2015 Earnings Results

February 2, 2016

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