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Gilead Sciences (GILD) Rallies After Ending a Late-Stage Trial Ahead of Schedule

By: , dated October 14th, 2013

Shares of Gilead Sciences (GILD) surged last week, after the company announced that it had ended a late-stage clinical trial of its cancer drug idelalisib earlier than anticipated because it was confident that the treatment was working. Idelalisib is a new treatment for chronic lymphocytic leukemia (CLL) and indolent (slow growing) non-Hodgkin lymphoma (iNHL). Daily Chart The study for CLL was ended earlier than anticipated, with Gilead reporting that patients treated with the drug lived for a longer time before the continuation of the disease progression or death. A panel of independent monitors not affiliated with Gilead recommended for the company to stop the trial. The trial compared a combination dose of idelasilib and Rocheâ s cancer drug Rituxan to Rituxan by itself. All the patients in the trial had been treated with various treatments before, but were not suited for more chemotherapy. Gileadâ s announcement dealt a severe blow against Infinity Pharmaceuticals (INFI), which is developing a competing treatment, IPI-145, for both indications. Gileadâ s idelasilib and Infinityâ s IPI-145 both function in a similar manner, attempting to inhibit the growth signals in the PI3K signalling pathway. When the PI3K pathway is overactive, cell death is reduced, which allows cancer cells to spread more easily. In addition, Gilead submitted a new drug application for idelasilib last month as a new treatment for iNHL, and intends to file for an approval in the European Union later this year. That double whammy of bad news sent Infinity shares down 14% by the end of last week. Last quarter, Gileadâ s earnings rose to $0.48 per share, a penny higher than the prior year quarterâ s earnings. Revenue rose 15% year-over-year to $2.77 billion. Gileadâ s bottom line was in line with Wall Street estimates, while its top line topped expectations. Gileadâ s main source of revenue is its antiviral (HIV) portfolio, which posted 15% year-over-year growth to $2.31 billion. The company also has a bright future in hepatitis C treatments with its new drug, sofosbuvir, which analysts believe could be approved as early as next year. Analysts believe that sofosbuvir could hit peak sales of $8 billion due to its milder side effect profile and the fact that it is orally administered, compared to current injected treatments. Shares of Gilead are already up 81% over the past twelve months, but it still trades with a 5-year PEG of 1.2, indicating strong bottom line growth potential ahead. Other News About GILD Gilead Sciences Stops Successful Cancer Drug Study Gileadâ s new cancer drug could arrive ahead of schedule. Gilead Sciences, Celgene And Other Biotechs Lifted After Citi Report Big biotechs are getting a lot of love from analysts. Other Stocks in the News Google The Power Player Invests In Another Giant Solar Farm Google continues investing in power plants. Valve Confirms Official AMD-Powered Steam Machine sFor 2014 AMD looks to become the official chip maker of the next generation of gaming consoles. Copyright 2013 by InvestorGuide.com, Inc. InvestorGuide has no control over the sites we link to, is not affiliated with these sites, and cannot take responsibility for their quality or suitability. The news, analysis, commentary and profile information is not meant to be comprehensive, and the data provided is not guaranteed to be accurate. WebFinance Inc., the publisher of this newsletter, is not a registered investment advisor or a broker/dealer. This is not a stock recommendation newsletter but rather a source for investment ideas, and we encourage you to fully research any company before considering investing. The opinions expressed herein are those of the author and do not necessarily represent the views of nor are they endorsed by WebFinance Inc. No employee of WebFinance has owned or currently owns any shares in the company described above. The above is neither an offer nor solicitation to buy or sell any securities. The trading of securities may not be suitable for all potential readers of this newsletter, and the purchase of stocks mentioned in this newsletter may result in the loss of some or all of any investment made. We recommend that you consult a stockbroker or financial advisor before buying or selling securities or making investment decisions. We are not responsible for claims made by advertisers and sponsors. Anyone who makes decisions based on what they read here does so at their own risk and cannot hold WebFinance Inc. (DBA InvestorGuide.com, Inc.) or its employees responsible.

Leo Sun Leo Sun

is a freelance finance writer and position trader. He focuses on a combination of value and momentum investing, with a strong interest in the trading philosophies of Warren Buffett and Peter Lynch. Leo also has experience writing articles to help small business owners acquire loans and manage their finances. He regularly contributes to the Stock of the Day analysis.

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