Gilead Sciences, Inc. · NASDAQ:GILD
Gilead Sciences — Merger or Acquisition (November 2011)
31 slides from Gilead Sciences's merger presentation, Nov 21, 2011
Slide 1: Gilead to Acquire Pharmasset
Gilead to Acquire Pharmasset November 21, 2011 Slide 1
Slide 2: Safe Harbor Disclaimer
Safe Harbor Disclaimer Statements included in this presentation that are not historical in nature are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Gilead cautions readers that forward-looking statements are subject to certain risks and unce
Slide 3: Agenda
Agenda Page 1. Pharmasset Acquisition Highlights 4 2. HCV Landscape 8 3. Overview of Pharmasset HCV Portfolio 16 4. Gilead’s Combined HCV Opportunity 22 Slide 3
Slide 4: Pharmasset Acquisition Highlights
Pharmasset Acquisition Highlights Slide 4
Slide 5: Terms of the Agreement
Terms of the Agreement ♦ Cash tender offer at $137 per share ♦ Transaction value of approximately $11 billion ♦ Tender offer expected to close within Q1 12 – Subject to minimum tender requirement – Hart-Scott-Rodino (antitrust) clearance – Other customary conditions Slide 5
Slide 6: Strategic Rationale
Strategic Rationale ♦ Accelerates Gilead’s strategy to develop the first all-oral regimen for the treatment of HCV – PSI-7977 is the most potent, advanced nucleotide in clinical development – Phase 3 clinical studies of PSI-7977 in combination with ribavirin open to enrollment – Targeted U.S. FDA ap
Slide 7: Fit with Gilead's Areas of Operational Excellence
Fit with Gilead’s Areas of Operational Excellence ♦ Established expertise and commitment to liver disease ♦ Preclinical, clinical development and regulatory expertise – Developed and commercialized 5 HIV and 2 hepatitis products – Viread regulatory approvals in approximately 140 countries – Establis
Slide 8: HCV Landscape
HCV Landscape (J GILEAD (J GILEAD Slide 8
Slide 9: Global Prevalence of HCV is Estimated to be 160 Million Individuals
Global Prevalence of HCV is Estimated to be 160 Million Individuals(1) HCV Prevalence (% of population) <1% 1-1.9% 2-2.9% >3% Not tested HCV Prevalence in Core and Emerging Markets (M) US2 EU-Core 52 Japan2 Europe Asia3 Latin Region Other3 America3 All GT 2.9 3.7 0.6 6.7 70.8 5.4 GT1 (%) 73% 63% 70%
Slide 10: HCV: A Significant Unmet Medical Need
HCV: A Significant Unmet Medical Need Over 12 Million Infected Individuals in Major Markets(1) with Fewer than 200,000 Treated per Year Patients in thousands 12,601 4,524 36% 4% 182 Prevalence Diagnosed Treated/ Year 1. Major markets include US, EU-5, Japan, Australia, Austria, Brazil, Denmark, Finl
Slide 11: HCV Treatment Evolution
HCV Treatment Evolution FDA Approval of 80 Protease Inhibitors (PIs) 66-79% in May 2011 70 54-63% 60 50 45-47% SVR % 38-43% 40 31-35% 30 13-19% 20 6% 10 0 IFNIFN 24 Wk IFNIFN 48 Wk IFN/RBV IFN/RBV IFN/RBV 24 Wk IFN/RBV IFN/RBV 48 Wk IFN/RBV PegIFN/RBV 48 Wk PegIFN/RBV 48 Protease PI + 24 Weeks 48 We
Slide 12: Challenges of Current PI-based Treatment Remains
Challenges of Current PI-based Treatment Remains ♦ Additional safety issues and exacerbation of side effects (rash and anemia) – Discontinuation rates significantly increased on PIs ♦ Lower response rates in sub-populations (previous IFN/RBV non-responders, cirrhotics) ♦ Burdensome for patients and
Slide 13: Ultimate Goal in HCV Therapy
Ultimate Goal in HCV Therapy ♦ Once a day ♦ Easier for doctors and ♦ Pan-genotype patients ♦ No clinical resistance ♦ Leads to increased ♦ No response guided therapy diagnosis and treatment ♦ Short duration ♦ Potential to cure many ♦ Safe with manageable more patients side effects ♦ High cure rates
Slide 14: The Evolution of HCV Therapy: 2010
The Evolution of HCV Therapy: 2010 IFN Sparing Strategy Ultimate Goal Current Standard of Combination Care (SOC): Oral Antivirals + Broad Genotypic Oral PEG + RBV Shorter Course IFN Antiviral Regimen 2010 2011 2020 The First Antivirals + SOC to Improve All Oral Antiviral Response Rates Regimen and R
Slide 15: The Competitive Nature and Speed of Development Have Significantly Accelerated the Timelines
The Competitive Nature and Speed of Development Have Significantly Accelerated the Timelines Ultimate Goal IFN Sparing Strategy Current Standard of Combination Care (SOC): Broad Genotypic Oral Antivirals + Oral PEG + RBV AntiviralIFN Shorter Course Regimen 2010 2011 2014 2020 The First Antivirals +
Slide 16: Overview of Pharmasset HCV Portfolio
Overview of Pharmasset HCV Portfolio Slide 16
Slide 17: Pharmasset's HCV Nucleotide Portfolio
Pharmasset’s HCV Nucleotide Portfolio •• 3.6 3.6 log log HCV HCV RNA↓ RNA↓ with with 400 400 mg mg QDQD over over 33 days days •• Phase Phase 33 in in combination combination with with ribavirin ribavirin PSI-7977 open open to to enrollment enrollment •• Highest Highest on on treatment treatment and
Slide 18: PSI-7977: Pharmasset's Lead Pyrimidine Nucleotide Analogue
PSI-7977: Pharmasset’s Lead Pyrimidine Nucleotide Analogue ♦ Excellent safety profile – 250 patients at 8 weeks or more – 1,500 patients by May 2014 ♦ High rates of cure in genotype 2/3 – 100% (10/10) with ribavirin – 60% (6/10) without ribavirin ♦ Studies in genotype 1 ongoing – Expecting Phase 2 S
Slide 19: PSI-7977: Genotype 2/3 Phase 2 Results (ELECTRON)
PSI-7977: Genotype 2/3 Phase 2 Results (ELECTRON) PSI-7977 PSI-7977 PSI-7977 RBV RBV NO PEG 12 weeks PEG NO PEG NO RBV Time (Weeks) n/n (%) < LOD n/n (%) < LOD n/n (%) < LOD 2 8/11 (82%) 8/10 (80%) 8/10 (80%) 4 11/11 (100%) 10/10 (100%) 10/10 (100%) 12 11/11 (100%) 10/10 (100%) 10/10 (100%) SVR4 11/
Slide 20: Pharmasset's Phase 3 Program
Pharmasset’s Phase 3 Program (Announced November 1, 2011) 0 12 24 36 FISSION PSI-7977 400mg N=~250 SVR12 Genotype 2/3 + RBV (naïve) N=~250 Peg-IFN + RBV SVR12 POSITRON 0 12 24 36 Genotype 2/3 N=~150 PSI-7977 400mg SVR12 (IFN intolerant) + RBV N=~75 PSI-7977 placebo SVR12 + RBV placebo ♦ A third Phas
Slide 21: Key Remaining Questions in the Treatment of HCV
Key Remaining Questions in the Treatment of HCV ♦ Will one regimen work for all genotypes or will different regimens be required for different genotypes? ♦ How many molecules or mechanisms do you need? ♦ Can ribavirin be replaced? ♦ What is the minimum duration of therapy? ♦ Can HCV be cured with on
Slide 22: Gilead's Combined HCV Opportunity
Gilead’s Combined HCV Opportunity Slide 22
Slide 23: Pharmasset and Gilead Combined HCV Efforts Position Us to Answer These Questions
Pharmasset and Gilead Combined HCV Efforts Position Us to Answer These Questions ♦ High barrier to resistance/pan-genotypic compounds will be an important component for any all-oral regimen – Pharmasset’s PSI-7977 is the most advanced, pan-genotypic compound with a high barrier to resistance – Ongoi
Slide 24: Combined HCV Clinical Portfolio
Combined HCV Clinical Portfolio Pharmasset Acquisition Complements and Accelerates Phase Gilead’s HCV Portfolio PC 1 2 3 PSI-7977 (nucleotide NS5B inhibitor)* PSI-938 (nucleotide NS5B inhibitor)* Tegobuvir/GS 9190 (non-nuc NS5B inhibitor) GS 9256 (NS3 protease inhibitor)** GS 9451 (NS3 protease inhi
Slide 25: All-Gilead Portfolio Increases the Chance of Developing Oral Therapies across Genotypes
All-Gilead Portfolio Increases the Chance of Developing Oral Therapies across Genotypes Nuc PI NS5A Non-Nuc PSI-7977 GS 9451 GS 5885 GS 9190 PSI-938 GS 9669 Combination Therapies with High Potency May Further Shorten Duration and Eliminate Ribavirin Slide 25
Slide 26: 2012 Key HCV Milestones
2012 Key HCV Milestones ♦ Initiate and integrate Pharmasset’s Phase 3 programs – GT 2/3 programs: no change – GT 1: Phase 2 data will determine strategy ♦ Initiate clinical trial with PSI-7977 to define minimum treatment duration in GT 2/3 patients ♦ Initiate multiple enabling drug-drug interaction
Slide 27: In Summary
In Summary ♦ Accelerates Gilead’s strategy to develop the first all-oral regimen for the treatment of HCV ♦ Since HCV can be cured, it will be important to be first to market with an all-oral, well-tolerated regimen ♦ Pharmasset is a strategic fit with Gilead’s areas of operational excellence ♦ Oppo
Slide 28: Gilead's Business Prospects
Gilead’s Business Prospects ♦ Strong confidence in our core business – LTM HIV revenues of ~$6.4B in a total ~$13.0B market – LTM ~$1B in revenues coming from products outside HIV ♦ Anticipate major HIV product launches in 2012 – New revenue sources through partnerships to follow ♦ More Phase 2/3 pr
Slide 29: Financial Impact of Pharmasset Acquisition
Financial Impact of Pharmasset Acquisition ♦ Cash flows from core business will allow us to finance transaction ♦ Expect to use existing cash and $6.2 billion in incremental debt ♦ Committed to retaining investment grade credit rating – Debt/EBITDA ratio to return to ≤1.5x at closing + 1 year ♦ Tran
Slide 30: Transaction Summary
Transaction Summary ♦ Unique opportunity to dramatically change HCV disease burden worldwide ♦ Potential to extend leadership in liver disease to HCV ♦ Opportunity to parallel the commercial success in HIV ♦ Redefined potential for revenue growth in 2014 and beyond Slide 30
Slide 31: Gilead to Acquire Pharmasset
Gilead to Acquire Pharmasset November 21, 2011 Slide 31
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