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Leonard Yaffe
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I am an MD by background who runs a healthcare hedge fund. I worked as a sell-side medical analyst for 20 years, covering pharmaceuticals, medical devices, PBMs and drug distributors.
  • GILD: Sovaldi Reimbursemnet Trends Favorable 2 comments
    Feb 14, 2014 11:36 AM | about stocks: GILD

    Several states have held hearings recently, much like the one I attended sponsored by the California Department of Public Health last November. In all cases, recommendations are being made to cover the direct acting antiviral regimens to treat Hepatitis C. Clinicians recognize the benefit of the higher cure rate associated with these drugs. Separately, the 2/7 new US prescriptions for Sovaldi were up 10% sequentially, and reflect an annualized revenue rate of $7.5 billion, while the total prescriptions grew sequentially 25%. I believe this latter trend reflecting prescription refills off of a higher base is underappreciated by Wall Street. Wall Street 2014 consensus revenues (worldwide) have moved up to the $4-6 billion range, while I remain at $8 billion.


    Disclosure: I am long GILD.

    Stocks: GILD
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  • JAC92651
    , contributor
    Comments (73) | Send Message
    Thank you for keeping us updated.


    I was confused by the indication in the earnings conference call that only $50 million of the purchases of Sovaldi were for patient demand. This seems vastly lower than the estimates and prescriptions. Would you have any clarifying insights?
    14 Feb 2014, 02:58 PM Reply Like
  • Leonard Yaffe
    , contributor
    Comments (152) | Send Message
    Author’s reply » My pleasure...The drug was available by prescription for only a few weeks in December. The $50 million in non-inventory sales was much higher than expectation, and this trend has continued into Q1 2014. Distributors make sure they have sufficient drug on hand at launch (ie, inventory) to meet expected demand. Len
    16 Feb 2014, 01:18 PM Reply Like
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