Gilead Dives As HHS Reportedly Mulls Cutting HIV Prevention Funding
ALLISON GATLIN
Gilead stock tumbled Wednesday on reports the Health and Human Services Department could slash federal funding for HIV prevention, a staple in Gilead Sciences' (GILD) topline.
The plans could be announced within a day, the Wall Street Journal reported citing unnamed sources. But the Trump administration could pull back on the plans or adjust them. The discussions come ahead of potential personnel cuts at the Centers for Disease Control and Prevention.
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For Gilead, the news would be a devastating blow. Last year, the company generated north of $19.61 billion in sales of its HIV treatments. Sales grew 8% and accounted for 68% of total revenue.
Gilead doesn't separate out which sales came from pre-exposure prophylaxis, or PrEP — drugs that people at risk of contracting HIV take to prevent contracting the virus. Truvada and Descovy are both used as treatments and PrEP drugs. In 2024, they brought in a combined $2.23 billion in sales.
In morning trades, Gilead stock fell 3% to 106.88. Shares broke out of a flat base with a buy point at 98.90 in early February. After running up close to a profit-taking zone through March 10, Gilead stock has pulled back. Shares are now narrowly above the 5% buy zone.
Gilead Is Working On Another PrEP Drug
The CDC has a department dedicated to preventing HIV and other infectious diseases. In 2023, the agency spent roughly $1.3 billion on HIV prevention, viral hepatitis, sexually transmitted infections and tuberculosis, according to WSJ.
The agency also funds a PrEP initiative, which provides free HIV prevention drugs.
The news comes even as Gilead plans to launch its drug, lenacapavir, for pre-exposure prophylaxis. Gilead is planning to launch lenacapavir this summer with a Food and Drug Administration review date of June 19. If approved, it would be the first twice yearly injection to prevent HIV.
Representatives of Gilead and HHS didn't immediately respond to a request for comment from Investor's Business Daily.
Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.
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