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GILD-We've Only Just Begun....

|Includes:Gilead Sciences, Inc. (GILD)

Gilead's Solvadi recorded new prescriptions for the week ending 5/13 of 3445, down 11% sequentially. Weekly prescriptions have been relatively flat at around 3600 since the end of February. Putting this in perspective, I remain incredibly bullish on the prospects for Gilead as it relates to Hepatitis C.

1. I have always cautioned against putting too much importance on weekly prescription data, as they are influenced by weather, medical conferences, and as we shall see in 2 weeks reporting time, weekday holidays. I view monthly data trends are more relevant.

2. That having been said, in 2013, when patients were being warehoused awaiting the introductions of Sovaldi and Olysio, about 1000 new prescriptions per week were written. In 2014, as those warehoused patients are treated, new prescriptions are averaging over 3000 per week. During the past month, warehousing has again begun occurring, with the expectation of Gilead's fixed dose combination tablet coming to market later this year. This will offer the patients the opportunity to be treated without the need for interferon or ribavirin, and will represent a huge advance in the treatment of Genotype 1 patients. Up until now, the patients who have "needed to be treated" have been prioritized for therapy by doctors, despite the frequent concomitant use (though for a lesser duration) of ribavirin, and sometimes, interferon. The elimination of these latter medications will significantly increase the pool of patients willing to be treated. Furthermore, the screening of the 1945-1965 birth cohort, which could add an incremental 800,000 patients diagnosed with Hepatitis C, has just started.

3. I am estimating Gilead's Hepatitis C related sales to be $9 billion in 2014, and $16 billion in 2015.

Len

Disclosure: I am long GILD.

Stocks: GILD