GILEAD SCIENCES, INC.

Gilead Sciences, Inc. is a biopharmaceutical company that has pursued and achieved breakthroughs in medicine for more than three decades, with the goal of creating a healthier world for all people, and is committed to advancing innovative medicines to prevent and treat life-threatening diseases, including HIV, viral hepatitis, COVID-19 and cancer. The company operates in more than 35 countries worldwide, with headquarters in Foster City, California.

Gilead operates in a highly competitive environment, and its products compete with other commercially available products based primarily on efficacy, safety, tolerability, acceptance by doctors, ease of patient compliance, ease of use, price, insurance and other reimbursement coverage, distribution and marketing. The company also faces significant competition from large pharmaceutical and biotechnology companies, specialized pharmaceutical firms, academic institutions, government agencies, and new branded or generic products introduced into major markets.

Gilead generates revenue primarily through product sales of its innovative medicines in virology, oncology and other therapeutic areas, as well as through royalty, contract and other revenues from outbound licenses of intellectual property, sales of certain intellectual property and other payments from collaborations with third-party partners. The company sells and distributes most of its products in the U.S. exclusively through the wholesale channel, with historically approximately 90% of gross product sales in the U.S. to three large wholesalers: Cardinal Health, Inc., Cencora, Inc. and McKesson Corporation, and their specialty distributor affiliates.

Gilead's commercial portfolio includes more than 25 therapies. In HIV, key products include Biktarvy, an oral formulation dosed once a day for the treatment of HIV-1 infection; Descovy, an oral formulation for treatment and for pre-exposure prophylaxis; Genvoya, Odefsey, Sunlenca, Symtuza, and Yeztugo. In Liver Disease, products include Epclusa for chronic hepatitis C virus, Livdelzi for primary biliary cholangitis, and Vemlidy for chronic hepatitis B virus. In Oncology, products include Tecartus and Yescarta, which are CAR T-cell therapies, and Trodelvy, a Trop-2 directed antibody and topoisomerase inhibitor conjugate. Other products include AmBisome, an antifungal agent, and Veklury, a treatment for COVID-19.

Gilead's research and development efforts are focused primarily on virology, oncology and inflammation. In 2025, the company continued to invest in and advance its R&D pipeline, with product candidates in Phase 3 clinical trials or pending marketing authorization review including bulevirtide for chronic hepatitis delta virus, lenacapavir for HIV PrEP, bictegravir and lenacapavir for HIV treatment, islatravir and lenacapavir in collaboration with Merck for HIV treatment, anitocabtagene autoleucel in collaboration with Arcellx for multiple myeloma, and various combinations of sacituzumab govitecan-hziy and domvanalimab with zimberelimab for oncology indications.

In 2025, Gilead received regulatory approvals or authorizations from FDA and European Commission for new products and expanded indications, including FDA approval for Yeztugo for PrEP and European Commission marketing authorization for Yeytuo for PrEP and for Lyvdelzi for the treatment of primary biliary cholangitis. The company also announced positive topline Phase 3 results from the ARTISTRY-1 and ARTISTRY-2 trials evaluating bictegravir and lenacapavir, entered into settlement agreements to resolve Biktarvy patent litigation with generic manufacturers, and announced a definitive agreement to acquire Arcellx, Inc.

Total revenues increased 2% to $29.443 billion ¹ in 2025, compared to $28.754 billion ² in 2024. Net income attributable to Gilead was $8.510 billion ³ and diluted earnings per share attributable to Gilead was $6.78 ⁴ in 2025, compared to net income attributable to Gilead of $480 million ⁵ and $0.38 ⁶ diluted earnings per share attributable to Gilead in 2024. The increase was primarily due to a $3.8 billion acquired in-process research and development expense related to the acquisition of CymaBay Therapeutics, Inc. in 2024 which did not repeat in 2025, lower pre-tax IPR&D partial impairment charges, higher net unrealized gains on equity securities, higher revenues, and lower selling, general and administrative expenses, partially offset by higher income tax expense.

As Gilead looks to 2026, management expects to see continued growth for product sales overall, bolstered by increased demand in the HIV business, partially offset by the impact of various policy-related developments in the U.S., an expected decrease in Veklury product sales due to lower rates of COVID-19-related hospitalizations, and an expected decrease in Cell Therapy product sales reflecting ongoing competitive headwinds. The R&D portfolio includes over 50 clinical-stage programs across core therapeutic areas, and the company expects updates in 2026 on various clinical trials and certain regulatory filing submissions and decisions, including FDA decisions related to two first-line breast cancer therapies and an additional HIV treatment option.

A key growth vector is the maximization of long-acting HIV therapies, highlighted by the launch of Yeztugo, the first and only twice-yearly HIV PrEP option available in the U.S., and a partnership with the U.S. State Department and PEPFAR to deliver lenacapavir for HIV PrEP for up to two million people over three years in countries supported by both PEPFAR and the Global Fund. Another major growth vector is the acceleration of the pipeline build in oncology and inflammation, evidenced by the definitive agreement to acquire Arcellx, Inc. to gain full control of anitocabtagene autoleucel for multiple myeloma, the acquisition of Interius BioTherapeutics, Inc. for approximately $350 million ⁷, and strategic partnerships with LEO Pharma A/S and Shenzhen Pregene Biopharma Co., Ltd.

Gilead plans to continue focusing on disciplined operating expense management as part of its overall investment approach to fund the advancement of its pipeline and commercialization of its products. The company expects to continue investing in its business and R&D pipeline both internally and externally through partnerships and select business development transactions.

Gilead is undertaking significant multi-year capital investments to expand its U.S. manufacturing capabilities and accelerate R&D, including an initiative to invest $32 billion in the U.S. through 2030 ⁸. The company announced ground-breaking on a new Pharmaceutical Development and Manufacturing Technical Development Center in Foster City, California as part of this planned investment.

Gilead's capital priorities include investing in its business and R&D pipeline, continuing select partnerships and business development transactions, growing its dividend over time, and repurchasing shares to offset dilution and opportunistically reduce share count. In the third quarter of 2025, the Board of Directors authorized a $6.0 billion ⁹ stock repurchase program. The company paid quarterly dividends of $3.16 per share ¹⁰ in 2025, and on February 10, 2026, the Board of Directors declared a quarterly dividend of $0.82 per share ¹¹ of common stock.

Gilead faces headwinds from the U.S. Medicare Part D program redesign impact, which contributed to an increase in gross-to-net deductions as a percentage of gross product sales to 41% ¹² in 2025 from 38% ¹³ in 2024. The company also anticipates that the Inflation Reduction Act will increase its payment obligations under the redesigned Part D discount program, limit the prices it can charge for its products, and increase the rebates it must provide government programs. Additionally, the company faces potential tariffs on pharmaceuticals and other products, with the U.S. Presidential administration announcing plans to impose up to 100% tariffs on imported branded or patented pharmaceuticals, subject to certain exceptions.

Gilead faces structural headwinds including pricing pressures from private insurers and government payers as its products mature, which often result in a reduction of net product prices. The company also faces risks from the potential for new branded or generic products entering major markets, which may impact its ability to maintain pricing and market share. In December 2025, Gilead reached an agreement with the U.S. administration to pause the imposition of Section 232 tariffs on Gilead for three years, implement most-favored-nation prices in Medicaid for select existing and future launched products, set a new direct-to-patient price for Epclusa, and return a portion of increased international revenues to the U.S. if the U.S. government is successful in increasing drug prices abroad.

Gilead receives a substantial portion of its revenue from sales of HIV products, and may be unable to sustain or increase sales of these products due to market share gains by competitive products, including generics, or the inability to introduce new HIV medications. The company faces significant pricing and reimbursement pressures from government agencies and other third parties, including required discounts and rebates, with gross-to-net deductions as a percentage of gross product sales increasing to 41% ¹⁴ in 2025 from 38% ¹⁵ in 2024, primarily due to the U.S. Medicare Part D program redesign impact. The Inflation Reduction Act requires the Department of Health and Human Services to negotiate Medicare prices for certain drugs, and in January 2026, Biktarvy was selected for Medicare negotiation of prices effective beginning in 2028, which the company anticipates will result in a substantially lower price. The company also faces risks related to its dependence on a limited number of wholesalers, with historically approximately 90% of gross product sales in the U.S. to three large wholesalers, and fluctuations in their inventory levels can cause operating results to fluctuate unexpectedly.

Management's message emphasizes the company's strategic ambitions to bring 10+ transformative therapies to patients by 2030 (tracking since 2020), be a biotech employer and partner of choice, and deliver shareholder value in a sustainable and responsible manner. The strategic priorities, as refreshed in late 2025, include maximizing the impact of long-acting HIV therapies, accelerating the pipeline build in oncology and inflammation, adopting and scaling artificial intelligence to transform how the company works, prioritizing investments for highest impact, and strengthening collaboration to accelerate innovation. Management expects to see continued growth for product sales overall in 2026, bolstered by increased demand in the HIV business, and plans to continue investing in the business and R&D pipeline both internally and externally through partnerships and select business development transactions.