Gilead's Mixed Q2 Results: Yeztugo Shines as CAR-T Sales Decline

Gilead Sciences reported a mixed second quarter, with overall sales growth driven by the promising launch of HIV PrEP drug Yeztugo, while its CAR-T cell therapy franchise faced continued challenges. The pharmaceutical giant's financial results reflect broader industry trends, including the rising competition in the cell therapy market and the potential of novel HIV treatments.

Yeztugo Launch Spurs Optimism

Gilead's second-quarter presentation highlighted the successful launch of Yeztugo, its new HIV pre-exposure prophylaxis (PrEP) drug. The company reported being on track to achieve its target of 75% covered lives within six months of launch, signaling strong market acceptance and potential for the new treatment. This development has sparked excitement among investors and analysts, positioning Yeztugo as a key growth driver for Gilead's HIV portfolio.

CAR-T Sales Face Headwinds

While Yeztugo's performance boosted spirits, Gilead's cell therapy segment experienced a notable decline. Sales of its CAR-T therapies, Yescarta and Tecartus, dropped by 7% overall in the second quarter:

• Yescarta revenue fell 5% to $393 million
• Tecartus sales declined 14% to $92 million

Gilead attributed the decrease to lower demand in the U.S. market. Analysts at Leerink Partners noted that Yescarta and Tecartus "clearly continue to suffer from significant competitive headwinds."

The challenges faced by Gilead's CAR-T franchise are not isolated. Novartis reported a 5% decline in sales of its CAR-T therapy Kymriah, which generated $125 million in the second quarter. These declines coincide with the rise of bispecific antibody treatments, which have been gaining regulatory approvals and market share.

Competitive Landscape in Cell Therapy

Despite the difficulties faced by some CAR-T therapies, others in the market have shown robust growth:

• Bristol Myers Squibb's Breyanzi, a rival CD19 therapy to Yescarta, saw a 125% year-over-year increase in sales to $344 million. The company now claims Breyanzi as the "No. 1 CAR-T in the U.S."
• Johnson & Johnson's Carvykti, developed in partnership with Legend Biotech for multiple myeloma, generated $439 million in Q2 sales, up from $186 million in the same quarter last year.

These contrasting performances highlight the evolving and competitive nature of the cell therapy market, with some products gaining ground while others face challenges.

Gilead's Financial Outlook

Despite the mixed results, Gilead reported overall positive financial performance for the quarter:

• Total sales reached $7.1 billion, a 2% increase year-over-year
• The company raised its annual sales projection by $100 million to a range between $28.3 billion and $28.7 billion

Gilead's ability to offset declines in its CAR-T franchise with growth in other areas, particularly the launch of Yeztugo, demonstrates the company's resilience and diverse portfolio strategy in navigating the complex pharmaceutical landscape.