Gilead earnings, revenue beat expectations

NEW YORK (CNNMoney.com) -- Biotech developer Gilead Sciences Inc. reported first-quarter earnings and revenue Wednesday that beat analysts' expectations.

Gilead (down $0.93 to $78.43, Charts) reported net income of $407.4 million, or 85 cents per diluted share, up from 262.7 million, or 55 cents, in the prior year.

The biotech reported total revenue of $1.03 billion, up 48 percent from $692.9 million in the year-earlier period.

The analyst consensus from Thomson Financial was for first-quarter non-GAAP earnings of 80 cents per share and total revenue of $998 million.

Gilead chief operating officer John Milligan said, on a call with analysts and reporters, that earnings were driven by HIV drugs Atripla, Truvada and Viread, as well as royalties from the bird flu drug Tamiflu sales, sold by partner Roche.

Milligan said that Gilead's business has never been stronger in the 20 years since its inception.

Gilead, based in Foster City, Calif., near San Francisco, reported that sales for its HIV drug franchise surged 56 percent to $705 million in the first quarter, from $451 million during the same period in 2006.

Sales for Atripla, a once-a-day combination drug produced with partners Bristol-Myers Squibb (down $0.03 to $28.26, Charts, Fortune 500) and Merck (down $0.32 to $49.69, Charts, Fortune 500), jumped 38 percent to $190 million in the first quarter, from the same period in 2006, said Gilead. Atripla is a relatively new anti-viral, launched in the U.S. in July of 2006. The combo is considered more convenient that the complex drug cocktails taken by AIDS patients.

Kevin Young, executive vice president of commercial operations, said on the call that Atripla became the leading HIV drug in just the second quarter after its launch. He said there are 75,000 patients taking Atripla, and a total of 500,000 patients taking Gilead's HIV drugs.

The company said first-quarter sales for its lead product, the HIV drug Truvada, jumped 39 percent over the same period last year, to $346 million.

Gilead, the developer of Tamiflu, said that royalties from its research and marketing partner Roche rose to $168 million in the first quarter from $115 million in the year-earlier quarter.

But sales for HIV drug Viread decreased 16 percent to about $160 million in the first quarter from the same period in 2006.

Prior to the earnings announcement, analyst Jim Reddoch of Friedman, Billings, Ramsey said he expected sales for the older HIV drug Viread to be "cannibalized" by newer products like Atripla.

Milligan does not own shares of Gilead stock but FBR makes a market in the company.