Gilead Receives FDA Approval For HIV Prevention Drug Descovy

Gilead Receives FDA Approval For HIV Prevention Drug Descovy
October 7, 2019

 

Gilead Sciences, Inc. (GILD) made headlines on Friday after the US Food and Drug Administration endorsed Descovy drug for minimizing the risk of sexually acquired HIV in teenagers and adults who are devoid of HIV, but are vulnerable to infection. Notably, this is the second drug to receive the FDA’s approval in its efforts to control and even end HIV infection. The stock of Gilead closed at $62.56, up $0.33 or 0.53% from the prior close.

The FDA explained that it had approved Descovy for PrEP (pre-exposure prophylaxis) to mitigate the risk of sexually transmitted HIV-1 in susceptible youngsters and adults who weigh a minimum of 35kg and do not suffer from HIV infection. FDA, which is the federal agency of the United States Department of Health and Human Services, accepted the supplemental New Drug Application (sNDA) for Descovy by giving it a priority appraisal designation.

PrEP, which is a method to avert HIV infection, involves daily consumption of the drug by individuals who are HIV-negative in order to negate the risk of acquiring HIV in case they come in contact with the virus.

However, the FDA has not permitted prescribing Descovy (emtricitabine 200 mg and tenofovir alafenamide 25 mg) to certain sections of the population, including women who have vaginal intercourse, as the capability of the medicine in such cases is yet to be ascertained. The FDA, as it can be understood, does not want to put such groups at unwanted risk.

In 2016, the FDA approved Descovy to be taken along with disparate antiretroviral drugs to give treatment for HIV-1 infection in grown-ups and pediatric patients. In 2012, Gilead’s blockbuster HIV drug Truvada was approved as a daily dose for PrEP. In case of Descovy, the approval was granted based on data from the multi-year global Phase 3 clinical trial named “DISCOVER.”

The trial compared the safety and effectiveness of Descovy with that of Truvada in minimizing the HIV-1 infection risk. Descovy not only exhibited non-inferior efficacy but also a better bone and renal safety profile in comparison with Truvada.

Daniel O’Day, Chairman and CEO of Foster City, California-based Gilead Sciences, explained how Descovy fares better in preventing HIV infection. The CEO said, “Descovy for PrEP provides a new HIV prevention option that matches Truvada’s high efficacy with statistically significant improvements in renal and bone safety, which can be an important consideration as people at risk increasingly use PrEP for longer periods of time.”

Last year, Descovy generated worldwide annual sales of $1.58 billion, an increase from $1.22 billion in 2017. The FDA’s approval for Descovy is anticipated to keep the stock bullish in the short-term.

Technically, the stock has support at 62 and resistance at 76. The ultimate oscillator remains almost flat near the reading of 50. As a result, we can expect the stock to remain range-bound in the near-term.

gil - technical analysis - 7th Oct 2019

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Richard W

Richard W

Richard is the guy who know everything there is about the financial industry, working in a top firm for over 15 years, he will give the lowdown on some of the biggest companies in the world


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