Gilead quiet on deals, but talks up pipeline at JPM

Investors want a deal, but Gilead is keeping steady on M&A for now.

Everyone wanted to listen to Gilead at the J.P. Morgan Healthcare Conference in San Francisco Monday, but it did not come up with what many investors most wanted to hear: a major deal.

Market watchers have been screaming for Gilead to deploy its massive cash pile, built up from its wildly successful hep C franchise. As hep C growth slowed, Gilead's notable R&D setbacks in recent months prompted investors to cry out for a deal, or a string of deals, to help beef up the company's pipeline.  

As analysts at Barclays said: “Gilead’s comments [at JPM] seem to imply that near-term expectations are mostly reasonable, but it did not address the issue of M&A and business development, which are more pressing topics in the minds of investors. 

“While we naturally did not expect management to identify specific markets or therapeutic categories, we did expect a more proactive stance to be taken in the presentation. That said, management’s tone seems to be positive overall with regard to operational trends and the pipeline, and we see relatively low risk of further multiple compression at current levels.”

Management made much of its HIV and NASH programs during its JPM presentation. One of these is its med selonsertib, which will see Gilead now focus on fibrotic patients, rather than the broader patient pool, as it moves toward phase 3 trials this year. 

This comes after the drug, an inhibitor of apoptosis signal-regulating kinase 1, missed its primary endpoints in both pulmonary arterial hypertension and diabetic kidney disease last year.

Gilead also published some slightly confusing figures for selonsertib late last year in nonalcoholic steatohepatitis (NASH), also known as nonalcoholic fatty liver disease, in an open-label phase 2 study.

The top-line data looked at both selonsertib alone and in combination with Gilead's simtuzumab (a.k.a. SIM), an investigational injected antibody directed against lysyl oxidase-like-2, and it appeared as if adding SIM didn’t do much to help NASH patients.

Its partner for SIM, U.K.-based Abenza, later said Gilead was not in fact happy with the med and was ditching further work on it.

There will also be some further NASH data for GS-0976 and GS-9674 (its FXR med) that are expected later this year, with combo tests expected to start in the next 6 months. 

In HIV, much of its discussion centered on late-stage integrase inhibitor bictegravir, which is slated to see new results in around 6 months.

Within oncology, which now has a new head (and potential dealmaker) in the form of ex-Novartis vet Riva, a futility analysis for the phase 3 GS-5745 gastric cancer trial is expected later this year, while the phase 2 entospletinib blood cancer studies are proceeding.

It ended the day up nearly 0.5%.