The combination of lenacapavir and islatravir could offer a superior option for HIV patients, as it would require only one injection every six months, compared to the daily pills or monthly injections that are currently available. The partnership could also help Gilead and Merck fend off the competition from ViiV Healthcare, which is also developing a long-acting injectable for HIV, called cabotegravir.
Threats: A Regulatory Uncertainty and a Legal Risk
One of the main threats for Gilead stock is the regulatory uncertainty that surrounds its products, especially in the U.S., where the Biden administration has pledged to lower drug prices and increase access to health care. Gilead’s drugs are among the most expensive in the market, and could face pressure from the government, insurers, and patients to reduce their costs.
For example, Gilead’s Veklury, which was priced at $3,120 per course of treatment in the U.S., was criticized by some lawmakers and advocacy groups as being too high, given the mixed results of its clinical trials.
Another threat for Gilead stock is the legal risk that stems from its patent disputes and antitrust lawsuits. Gilead has been involved in several litigation cases over the years, with competitors, governments, and non-governmental organizations, over the validity and infringement of its patents, as well as the alleged anti-competitive practices of its business.
For instance, Gilead is currently facing a lawsuit from the U.S. Department of Justice, which claims that the company infringed on the government’s patents for Truvada and Descovy, two of its HIV drugs that are also used for pre-exposure prophylaxis (PrEP). The lawsuit seeks damages and royalties from Gilead, as well as an injunction to stop the company from selling the drugs.
Conclusion: A Buy for the Long Term
Gilead stock is currently trading at $81.01 per share, as of December 29, 2023, down 0.16% from the previous close. The stock has a market capitalization of $100.94 billion, a price-to-earnings ratio of 17.40, and a dividend yield of 3.70%. The stock has a 52-week high of $88.29, and a 52-week low of $72.87.
