Gilead’s Profit Is Boosted by Tax Gain

Gilead Sciences Inc., a biotechnology company that sells drugs for AIDS and other infectious diseases, said profit jumped more than fivefold in the fourth quarter, lifted by sales of its HIV drug Viread and a tax-related gain.

Net income rose to $192.6 million, or 85 cents a share, from $35.5 million, or 17 cents, in the quarter a year ago, the Foster City, Calif.-based company said. Sales climbed to $263.5 million from $145 million.

Viread sales more than doubled as prescriptions increased and wholesalers stocked up on the medicine.

Gilead is struggling to control inventory levels and the company said Viread sales would fluctuate as a result.

The HIV treatment will have sales of as much as $750 million this year, Gilead said.

“The company has put in several mechanisms to reduce variability in inventory levels and thus far it doesn’t appear to have gained traction,” said Eric Schmidt, an analyst at SG Cowen Securities Corp. “It’s a bit of a distraction to the Gilead story.”

Shares of Gilead fell as much as 7.7% in after-hours trading. It ended the regular session down 33 cents to $60.69 on Nasdaq.

Gilead said it had a tax benefit of $111.6 million during the quarter. Excluding the tax gain and some other costs, Gilead said it would have earned 42 cents a share, matching the average estimate of analysts surveyed by Thomson First Call.

Viread sales jumped to $176.8 million in the fourth quarter. Gilead is working on a medicine that combines Viread with Gilead’s newest AIDS treatment, Emtriva, into a single, once-a-day pill.

Gilead has said it may begin selling the drug as early as the first quarter of 2005.

Revenue from Ambisome, an anti-fungal treatment that was Gilead’s top seller before Viread, climbed 10% to $54.5 million.