Gilead Sciences, Inc. () is an American biopharmaceutical company headquartered in Foster City, California, that focuses on researching and developing antiviral drugs used in the treatment of HIV/AIDS, hepatitis B, hepatitis C, influenza, and COVID-19. It also develops medicines in therapeutic areas such as oncology and inflammation and cell therapy.
In 1987, Michael L. Riordan founded the company under the name Oligogen. The original name was a reference to oligonucleotides, small strands of DNA used to target genetic sequences. Gilead held its initial public offering in 1992, and successfully developed drugs including Tamiflu and Vistide that decade.
In the 2000s, Gilead began evolving from a biotechnology company into a large pharmaceutical company, through acquisitions and investments, acquiring several subsidiaries. Gilead is a member of the Nasdaq-100 and the S&P 100.
The company has faced criticism over its business practices, including extremely high pricing of drugs such as Sovaldi and Truvada in the United States relative to production cost and cost in the developing world.
History Foundation
In June 1987, Gilead Sciences was originally founded under the name Oligogen by Michael L. Riordan, a medical doctor. Riordan graduated from Washington University in St. Louis, the Johns Hopkins School of Medicine, and the Harvard Business School. The idea for Gilead began as a research project at Menlo Ventures, where Michael was an associate. Three scientific advisers worked with Riordan to create the company: Peter Dervan of Caltech, Doug Melton of Harvard, and Harold M. Weintraub of the Fred Hutchinson Cancer Research Center, along with H. Dubose Montgomery, one of Menlo Ventures founders. Riordan served as CEO from the company's founding until 1996. Menlo Ventures subsequently made the first investment in Gilead of $2 million. Riordan also recruited scientific advisers, including Harold Varmus, a Nobel laureate who later became Director of the National Institutes of Health, and Jack Szostak, recipient of the Nobel Prize for Physiology or Medicine in 2009.
The company's primary therapeutic focus was in antiviral medicines, a field that piqued Riordan's interest after he contracted dengue fever. Riordan recruited Donald Rumsfeld to join the board of directors in 1988, Available through NewsBank. followed by Benno C. Schmidt, Sr., Gordon Moore, and George P. Shultz. Riordan tried to recruit Warren Buffett as an investor and board member but was unsuccessful.
The company focused its early research on making small strands of DNA (oligomers, or more particularly, oligonucleotides) to target specific genetic code sequences – that is, antisense therapy, a form of gene therapy. According to Riordan, he had always wanted to use the name Gilead Sciences all along. Still, he used Oligogen as a temporary name because he needed to deal with a trademark clearance issue with a California nonprofit organization that was already using the word Gilead in its name. He had first heard of the Balm of Gilead when he read Lanford Wilson's play Balm in Gilead while in medical school, then learned that naturally occurring acetylsalicylic acid (aspirin) had been found in modern times in a willow tree species from that part of that world, and was therefore inspired to name his company Gilead. After founding Oligogen, he contacted the nonprofit about the naming issue and secured the right to use the Gilead Sciences name in exchange for a $1,000 donation.
By 1988, the company had moved its headquarters to Foster City's Vintage Park neighborhood, where it has been based ever since.
The company began developing small-molecule antivirals in the early 1990s, entering licensing agreements in 1991 and 1992 with the Institute of Organic Chemistry and Biochemistry in Prague and the Rega Institute for Medical Research in Leuven for nucleotide analogues discovered through the collaboration of Czech chemist Antonín Holý and Belgian virologist Erik De Clercq.
In 1991 and 1992, Gilead licensed nucleotide analogues from the Institute of Organic Chemistry and Biochemistry in Prague and the Rega Institute for Medical Research in Leuven, beginning its development of small-molecule antivirals. They had been discovered through a collaboration between Antonín Holý and Erik De Clercq. The compounds included cidofovir, tenofovir and adefovir, which Gilead subsequently developed as Vistide, Viread and Hepsera.
Riordan later recalled that Gilead's first decade as a startup was an extremely stressful experience for him, as a young venture capitalist serving for the first time as the founder, chairman, and chief executive officer of his own biotech company. The new company had no products and very little income, and narrowly escaped going out of business on several occasions: "It was touch and go for a long time". Finding a way for Gilead to make money was Riordan's top priority "every second of the day for eight years".
1990–1999: IPO Gilead's antisense intellectual property portfolio was sold to Ionis Pharmaceuticals. Gilead debuted on the NASDAQ in January 1992. Its initial public offering raised $86.25 million in proceeds. In June 1996, Gilead launched Vistide (cidofovir injection) for the treatment of cytomegalovirus (CMV) retinitis in patients with AIDS. In January 1997, Donald Rumsfeld was appointed chairman, but left the board in January 2001 when he was appointed United States Secretary of Defense during George W. Bush's first term as president.
In March 1999, Gilead acquired NeXstar Pharmaceuticals of Boulder, Colorado. At the time, NeXstar's annual sales of $130 million was three times Gilead's sales; it sold AmBisome, an injectable fungal treatment, and DaunoXome, an oncology drug taken by HIV patients. That same year, Roche announced FDA approval of Tamiflu (oseltamivir) for the treatment of influenza. Tamiflu was originally discovered by Gilead and licensed to Roche for late-phase development and marketing.
One reason for entering into the Tamiflu licensing agreement was that with only 350 employees, Gilead still did not yet have the capability to sell its drugs directly to overseas buyers. Available through NewsBank. To avoid having to license future drugs in order to access international markets, Gilead simply acquired the 480-employee NeXstar, which had already built its own sales force in Europe to market AmBisome there.
2000 to 2009
Viread (tenofovir) achieved first approval in 2001 for the treatment of HIV.
In 2002, Gilead changed its corporate strategy to focus exclusively on antivirals, and sold its cancer assets to OSI Pharmaceuticals for $200 million. In December 2002, Gilead and Triangle Pharmaceuticals announced that Gilead would acquire Triangle for around $464 million; Triangle's lead drug was emtricitabine that was near FDA approval, and it had two other antivirals in its pipeline. The company also announced its first full year of profitability. Later that year, Hepsera (adefovir) was approved for the treatment of chronic hepatitis B, and Emtriva (emtricitabine) for the treatment of HIV.
During this era, Gilead completed its gradual evolution from a biotech startup into a pharmaceutical company. The San Francisco Chronicle noted that by 2003, the Gilead corporate campus in Foster City had expanded to "seven low-slung sand-colored buildings around a tiny lake on which ducks happily paddle." Like many startups, Gilead originally leased its space, but in 2004, the company paid $123 million to buy all its headquarters buildings from its landlords. However, even as Gilead developed its ability to distribute and sell its own drugs, it remained distinct from most pharmaceutical companies in terms of its strong reliance on subcontracting most of its manufacturing to contract manufacturing organizations.
In 2004, during the Avian flu pandemic scare, Gilead Sciences' revenue from Tamiflu almost quadrupled to $44.6m as more than 60 national governments stockpiled the antiviral drug, though the firm had made a loss in 2003 before concern about the flu started. As stocks soared, US Defense Secretary and Pentagon chief Donald Rumsfeld sold shares of the company, receiving more than $5 million in capital gains, while still maintaining up to $25m-worth of shares by the end of the year. Sales of Tamiflu almost quadrupled again in 2005, to $161.6m, during which time the share price tripled. A 2005 report showed that, in all, Rumsfeld owned shares worth up to $95.9m, from which he got an income of up to $13m.
In 2006, the company acquired Corus Pharma, Inc. for $365 million. The acquisition of Corus signaled Gilead's entry into the respiratory arena. Corus was developing aztreonam lysine for the treatment of patients with cystic fibrosis who are infected with Pseudomonas aeruginosa. In July 2006, the U.S. Food and Drug Administration (FDA) approved Atripla, a once a day single tablet regimen for HIV, combining Sustiva (efavirenz), a Bristol-Myers Squibb product, and Truvada (emtricitabine and tenofovir disoproxil), a Gilead product.
Gilead purchased Raylo Chemicals, Inc. in November 2006, for a price of . Raylo Chemical, based in Edmonton, Alberta, was a wholly owned subsidiary of Degussa AG, a German company. Raylo Chemical was a custom manufacturer of active pharmaceutical ingredients and advanced intermediates for the pharmaceutical and biopharmaceutical industries.
Later in the same year, Gilead acquired Myogen, Inc. for $2.5 billion (then its largest acquisition). With two drugs in development (ambrisentan and darusentan), and one marketed product (Flolan) for pulmonary diseases, the acquisition of Myogen has solidified Gilead's position in this therapeutic arena. Under an agreement with GlaxoSmithKline, Myogen marketed Flolan (epoprostenol sodium) in the United States for the treatment of primary pulmonary hypertension. Additionally, Myogen was developing (in Phase 3 studies) darusentan, also an endothelin receptor antagonist, for the potential treatment of resistant hypertension.
Gilead expanded its move into respiratory therapeutics in 2007 by entering into a licensing agreement with Parion for an epithelial sodium channel inhibitor for the treatment of pulmonary diseases, including cystic fibrosis, chronic obstructive pulmonary disease and bronchiectasis.
In 2009, the company acquired CV Therapeutics, Inc. for $1.4 billion, bringing Ranexa and Lexiscan into Gilead. Ranexa is a cardiovascular drug used to treat chest pain related to coronary artery disease, with both of these products and pipeline building out Gilead's cardiovascular franchise. Later that year, the company was named one of the Fastest Growing Companies by Fortune.
2010 to 2019
In 2010, the company acquired CGI Pharmaceuticals for $120 million, expanding Gilead's research expertise into kinase biology and chemistry. Later that year, the company acquired Arresto Biosciences, Inc. for $225 million, obtaining developmental-stage research for treating fibrotic diseases and cancer.
In February 2011, the company acquired Calistoga Pharmaceuticals for ($225 million plus milestone payments). The acquisition boosted Gilead's oncology and inflammation areas. Later that year, Gilead made its most important acquisition – and by then most expensive – with the purchase of Pharmasset, Inc. This transaction helped cement Gilead as the leader in treatment of the hepatitis C virus by giving it control of sofosbuvir (see below).
In October 2011, Gilead broke ground on a massive multi-year expansion of its 17-building headquarters campus in Foster City. By replacing eight one or two-story buildings with seven new structures ranging as tall as 10 stories, Gilead nearly doubled its headquarters real estate footprint from about 620,000 square feet to about 1.2 million square feet.