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By Deena Beasley
Oct 27 (Reuters) - Gilead Sciences Inc on Tuesday said its quarterly profit rose 70 percent, but sales growth for its hepatitis C drugs flattened as health insurers limited access to the expensive treatments.
Shares of the biotechnology company fell slightly. Gilead’s quarterly product sales rose 37 percent to $8.2 billion. Sales of hepatitis C drugs Sovaldi and Harvoni totaled $4.8 billion, which was just ahead of the $4.5 billion average Wall Street estimate, but little changed from second quarter sales.
Company officials said hepatitis C sales were likely to stay flat through 2016 as health insurers restrict patient access to Gilead’s drugs, which have list prices of more than $1,000 a pill.
Gilead’s shares, which rose 2 percent in regular trading, were down 2 percent at $108.75 after hours.
For hepatitis C sales, “2016 I think will be a more stable year in the U.S.,” Gilead Chief Operating Officer John Milligan said on a conference call with analysts and investors.
He said the company is “doing a lot of work to encourage earlier treatment, more screening and so on,” but U.S. insurers are still being selective in authorizing treatment.
U.S. health regulators last week issued a warning of potential risk of serious liver injury for certain patients using hepatitis C treatments made by rival AbbVie Inc, but more competitors are coming, including from Merck & Co Inc likely early next year.
Gilead officials declined to comment on whether the shifting competitive landscape would affect its pricing strategy.
After adjusting for one-time items, Gilead earned $3.22 per share, beating the average Wall Street estimate of $2.87 per share, according to Thomson Reuters I/B/E/S.
“The quarter was solid,” said RBC Capital Markets analyst Michael Yee. “They had significantly better total sales and they crushed it on EPS. The beat was mostly due to the first generation hepatitis C drug Sovaldi not Harvoni.”
Gilead raised its outlook for full-year product sales to between $30 billion and $31 billion, from a previous estimate of $29 billion to $30 billion. But Yee said Wall Street analysts have already estimated higher Gilead sales for the year.
Gilead posted quarterly net income of $4.6 billion, or $3.06 per share, compared with $2.7 billion, or $1.67 per share, a year earlier. (Additional reporting by Bill Berkrot; Editing by Alan Crosby and Grant McCool)