Is Gilead Sciences, Inc. (GILD) Destined for Greatness?

The big news these days is undoubtedly Gilead’s sofosbuvir, a very promising hepatitis-C drug that’s passing its trials with flying colors. Gilead is already a leading producer of hepatitis-B treatments with Viread, which is also used to treat HIV. A successful patent settlement with Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) keeps that drug under Gilead’s thumb until 2017, but losing that drug’s exclusivity will hurt — approximately 350 million people around the world are afflicted with hep B, and an estimated 620,000 die of the disease each year. That compares to approximately 200 million people worldwide with hep C, but Gilead’s not alone in trying to treat this large patient base. AbbVie Inc (NYSE:ABBV) is also moving a Hep C drug through trials, and its near-perfect cure rate makes it look like the drugmaker to beat at the moment. Nor is Gilead’s lucrative HIV-treatment dominance unchallenged. Pfizer and GlaxoSmithKline plc (ADR) (NYSE:GSK) are moving dolutegravir, a challenger to Gilead’s four-in-one treatment, through phase 3 trials at the moment.

Gilead’s expanding from these two lucrative treatment areas into myelofibrosis drugs, both through an internally developed drug called simtuzumab and through its acquisition of small biotech YM Biosciences, which has been working on a drug to treat the same disease through a different action mechanism. That, as my fellow Fool Brian Orelli points out, could lead to a combo drug similar to its four-in-one HIV drug Stribild. This is a much less common disease than the hepatitis variants, afflicting roughly one of every 500,000 people worldwide. It’ll have to compete against Incyte Corporation (NASDAQ:INCY)‘s Jakafi, which has been performing about as well as a drug developed for one out of every 500,000 people might be expected to.

Sofosbuvir, as my Foolish colleague Sean Williams notes, might be one drug hopeful that could change lives (and portfolios). Will it be able to stand up against AbbVie’s competition? That remains to be seen. It’s looking like sofosbuvir will be approved this year, likely before AbbVie’s drug will, so we might see a turnaround on these scores sooner rather than later.

Putting the pieces together
Today, Gilead has some of the qualities that make up a great stock, but no stock is truly perfect. Digging deeper can help you uncover the answers you need to make a great buy — or to stay away from a stock that’s going nowhere.

The article Is Gilead Sciences Destined for Greatness? originally appeared on Fool.com and is written by Alex Planes.

Fool contributor Alex Planes holds no financial position in any company mentioned here. Add him on Google+ or follow him on Twitter @TMFBiggles for more insight into markets, history, and technology. The Motley Fool recommends Gilead Sciences.

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