Gilead Sciences, Inc. GILD recently entered into a collaboration and license agreement with Vir Biotechnology, Inc. VIR to discover and engineer three novel PRO-XTEN dual-masked T-cell engager (TCE) development candidates targeting selected solid tumor-associated antigens.
Per the deal, Gilead will have an exclusive license to develop and commercialize the novel TCEs.
The collaboration gives Gilead an opportunity to develop three potential cancer therapies targeting selected solid tumor-associated antigens, broadening its next-generation immunotherapy portfolio.
We note that GILD is looking to strengthen its oncology franchise and diversify its revenue base, which is highly concentrated on HIV business.
Under the financial terms of the agreement, Vir Biotechnology will be eligible to receive up to $135 million in total upfront and near-term preclinical milestone payments, consisting of $90 million in upfront consideration and up to $45 million in potential near-term preclinical milestones. Gilead could also owe up to $1.74 billion in additional development, regulatory and commercial milestone payments, along with tiered royalties on net sales. These payments depend on the achievement of specified milestones and do not represent guaranteed costs payable immediately.
Gilead’s oncology portfolio, comprising the Cell Therapy franchise and breast cancer drug Trodelvy, has diversified its overall business. The breast cancer drug Trodelvy has performed well since its approval.
Trodelvy, a first-in-class Trop-2-directed antibody-drug conjugate (ADC), is approved in several countries for second-line or later metastatic triple-negative breast cancer and for certain patients with pre-treated HR+/HER2- metastatic breast cancer.
GILD has multiple ongoing studies aimed at further expanding Trodelvy’s label.
However, the Cell Therapy franchise, comprising Yescarta and Tecartus, is currently under pressure due to competitive headwinds in the United States and Europe that are expected to continue.
Gilead’s recent aggressive dealmaking strategy, including the acquisitions of Arcellx and Tubulis, underscores its commitment to diversifying beyond its core HIV franchise and expanding into higher-growth oncology and immunology markets.
Launch preparations are underway for anito-cel (added from Arcellx acquisition), which has a Dec. 23 regulatory action date for heavily pretreated relapsed or refractory multiple myeloma.
The Tubulis acquisition added next-generation antibody-drug conjugate (ADC) assets, including GS-8824, a NaPi2b-directed topoisomerase-I inhibitor ADC, and a platform to develop novel ADCs, to GILD’s pipeline.
Competition for GILD’s Oncology Business
Datroway (datopotamab deruxtecan), developed by AstraZeneca AZN and Daiichi Sankyo, is also a TROP2-directed ADC.
It is approved in several countries for the treatment of adult patients with unresectable or metastatic TNBC who are not candidates for PD-1/PD-L1 inhibitor therapy.
AstraZeneca and Daiichi Sankyo entered into a global collaboration agreement in March 2019 to jointly develop and commercialize Enhertu (trastuzumab deruxtecan), followed by a similar agreement for Datroway in July 2020. Daiichi Sankyo retains exclusive rights to both ADCs in Japan.
AstraZeneca and Daiichi Sankyo recently entered into a clinical collaboration agreement with Summit Therapeutics Inc. to evaluate Datroway in combination with ivonescimab across multiple tumour types, including lung and breast cancers. The companies intend to begin with a phase III study in first-line TNBC.
In May 2026, AstraZeneca and Daiichi Sankyo announced that the Datroway has been approved in the United States for the treatment of adult patients with unresectable or mTNBC who are not candidates for PD-1/PD-L1 inhibitor therapy.
In the Cell therapy space, GILD’s therapies face competition from Bristol Myers’ BMY Breyanzi.
Breyanzi is a CD19-directed CAR T cell therapy with a 4-1BB costimulatory domain, which enhances the expansion and persistence of the CAR T cells. It is approved for multiple blood cancers and is a top contributor to BMY’s top line.
BMY is also evaluating arlocabtagene autoleucel (arlo-cel; BMS-986393) in heavily pretreated patients with relapsed and refractory multiple myeloma (RRMM).
GILD’s Price Performance, Valuation and Estimates
Shares of GILD have gained 25.1% year to date against the industry’s decline of 0.3%.
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Going by the price/earnings ratio, GILD’s shares currently trade at 19.9X forward earnings, higher than its mean of 12.32X and the large-cap pharma industry’s 17.92X.
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Over the past 30 days, the consensus estimate for 2026 loss per share has narrowed to 47 cents from 59 cents. The earnings estimate for 2027 has increased to $9.87 per share from $9.58 over the same period.
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While Gilead’s recent aggressive dealmaking strategy strengthens its long-term pipeline and growth potential, the sizable upfront payments and integration-related costs are pressuring near-term profitability.
GILD currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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