By Michael Erman
(Reuters) -Gilead Sciences on Thursday reported lower second-quarter profit as costs from a legal settlement and sharply lower sales of its COVID-19 treatment offset another strong performance by HIV drugs.
The drugmaker raised its full-year revenue forecast, even as it trimmed its estimate for COVID antiviral Veklury due to lower pandemic-related hospitalizations.
The company said it now expects sales of Veklury, known generically as remdesivir, to total $1.7 billion this year, down from its previous estimate of around $2 billion.
Second-quarter sales of the hospital-administered drug fell 43% from a year ago to $256 million, well below analysts’ forecasts of $351 million.
Gilead reported second-quarter earnings of $1.34 per share excluding items, on total revenue of $6.6 billion, down from $1.58 a share and revenue of $6.26 billion in the year-ago quarter.
Wall Street analysts had expected an adjusted profit of $1.64 per share on revenue of $6.44 billion, according to Refinitiv data.
The company said earnings were hurt by a $525 million, or 32 cents a share, charge related to HIV antitrust litigation settlements.
Research & development costs also increased year-over-year, rising more than 25% to $1.4 billion.
Chief Medical Officer Merdad Parsey said the increase was due to the culmination of multi-year plans to diversify Gilead’s pipeline, resulting in 21 late-stage trials ongoing simultaneously.
“We are going to be really disciplined about where we go from here … looking at our portfolio and making some tough decisions around what keeps going and what doesn’t,” Parsey said in an interview.
Gilead cut its full-year adjusted earnings forecast to a range of $6.45 to $6.80 per share, from $6.60 to $7.00. The California-based company raised the low end of its 2023 revenue forecast range to $26.3 billion from $26.0 billion, but kept the high end at $26.7 billion.
Its shares rose 0.6% in after hours trading to $76.
Product sales excluding Veklury rose 11% to $6.31 billion in the quarter due to the strength of the company’s HIV treatments and cell therapy for cancer.
Sales of Gilead’s HIV portfolio rose 9% to $4.63 billion, with Biktarvy bringing in $2.98 billion, compared with Wall Street estimates of $2.85 billion.
(Reporting By Michael Erman, additional reporting by Deena Beasley; Editing by Bill Berkrot)