Gilead Sciences shares falling after replacing CEO, amid new competition for hepatitis C drug

Longtime Gilead Sciences CEO John Martin is stepping down and is being replaced by John Milligan, the Foster City biotech company’s chief operating officer. Martin, 64, who was chief executive for 20 years, will become executive chairman.

Martin presided over Gilead’s extraordinary growth as it came to dominate the market for hepatitis C drugs. In 2013, the FDA approved Sovaldi, a pill that’s an alternative to side-effect-laden injections. It cost $1,000 a pill and more than $84,000 for the full 12-week treatment. In 2014, a follow-up drug, Harvoni, was approved. It too, came with a hefty price tag: $94,500 for 12 weeks, $63,000 for 8 weeks.

Gilead also was held up as a poster child for what’s wrong with drug pricing in America. In December, a couple of senators announced results of an 18-month investigation that found Gilead’s pricing practices to be based solely on “maximizing revenue regardless of the human consequences.”

Gilead is also known for its HIV treatments, including Truvada, which was first approved in 2004. Late last year, the company received approval for Genvoya, a new single-tablet treatment for HIV.

Shares of Gilead skyrocketed between 2012 and 2013 and stayed near their highs in 2014 and 2015. Last year they reached an all-time high of about $117. But they have been falling quickly lately, and are down nearly 5 percent today on news of a cheaper competitor in the hepatitis C drug market. The FDA on Thursday approved Zepatier, a new hep C drug from Merck, that costs $54,600 for 12 weeks.

Milligan, who has been with the company since 1990, had been COO since 2007 and president since 2008. He is 54.

Gilead is scheduled to release its earnings report Tuesday.

 

Photo: Gilead Sciences CEO John Martin holds a bottle of Truvada, for HIV, in the company’s lab in Foster City, Calif., Monday, May 2006. (Paul Sakuma/Associated Press)

 

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