HSBC has pointed out the strategic moves by Gilead Sciences (NASDAQ:GILD) and GlaxoSmithKline (NYSE:GSK) as they focus on long-acting (LA) treatments to enhance patient adherence and potentially increase the market size.
Gilead reported data from its Purpose-2 trial in HIV prevention last month, showing a 99.9% efficacy rate for its LA product, lenacapavir. This was a slight dip from the 100% efficacy observed in the Purpose-1 trial in July. Despite this, Gilead plans to launch lenacapavir for pre-exposure prophylaxis (PrEP) use in 2025, which is an advancement from their previous guidance of "end of 2025."
Gilead's long-acting HIV treatment is seen as a critical step for the company, especially as it competes with GSK, which already markets its LA product, cabotegravir, for both treatment and prevention.
The shift towards LA regimens is expected to address issues with oral treatment compliance, which Gilead reports as being surprisingly low at 80%. Improved adherence with LA treatments could theoretically enlarge the market by 25%, assuming full compliance at the same price point. Additionally, more convenient treatments could retain more patients in care, potentially leading to increased market size and better insurance coverage.
The Centers for Disease Control and Prevention (CDC) estimates that 1.2 million Americans could benefit from PrEP, significantly higher than the 400,000 currently using it. The HIV treatment market is projected to be worth $5-7 billion, more than double the current level, with potential for further expansion. Gilead and GSK, which together account for 90% of the market, are looking to long-acting treatments to maintain market value, with GSK having already upgraded its HIV growth guidance a year ago from mid-single digit growth for 2021-2026 to 6-8%.
The competition extends to the method of administration, with GSK's cabotegravir requiring two intramuscular injections every two months, while Gilead's lenacapavir involves two subcutaneous injections every six months. Patient preference may play a role in the success of these treatments. Gilead is closely monitoring GSK's handling of its LA treatment, Apretude, for PrEP to potentially gain insights for lenacapavir.
Gilead is expected to provide an update on its outlook, strategy, and pipeline during an analyst day in December 2024. The company's pipeline includes a potential treatment combining Biktarvy and Lenacapavir, which could be launched by the end of this decade, ahead of Biktarvy's patent expiration in 2033. Meanwhile, GSK is developing a once-a-year treatment option, VH310A, set to enter human trials, and Moderna (NASDAQ:MRNA) is working on an mRNA HIV vaccine, indicating ongoing innovation in the HIV treatment space.
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