Ladies and gentlemen, thank you for standing by and welcome to the Gilead Sciences First Quarter 2018 Earnings Conference Call. My name is Candice, and I'll be your conference operator today. At this time, all participants are in a listen only mode. And as a reminder, this conference call is being recorded. I would now like to turn the call over to Sung Lee, Vice President of Investor Relations.
Please go ahead.
Thank you, Candice, and good afternoon, everyone. Just after market close today, we issued a press release with earnings results for the first quarter 2018. The press release and detailed slides are available on the Investor Relations section of the Gilead website. The speakers on today's call will be John Milligan, President and Chief Executive Officer John McHutchison, Chief Scientific Officer and Head of Research And Development and Robin Washington, Executive Vice President And Chief Financial Officer. Also in the room with us for the Q And A session is Andrew Chang, Chief Medical Officer and Executive Vice President.
Before we begin with our prepared comments, Let me remind you that we will be making forward looking statements, including plans and expectations with respect to products, product candidates, financial projections and the use of capital, all of which involve certain assumptions, risks and uncertainties that are beyond our control closure documents and recent press releases. In addition, Gilead does not undertake any obligation to update any forward looking statements made during this call. Non GAAP financial measures will be used to help you understand the company's underlying business performance. The GAAP to non GAAP reconciliations are provided the earnings press release as well as on the Gilead website. I will now turn the call over to John Milligan.
Thank you, Sung, and thank you, everyone, for joining us today. I would like to start by introducing John McHutchison and Andrew Chang in their new roles. As you know, Norbert made the decision earlier this year to step down his position as Chief Scientific Officer. I've worked along Norbert for 27 years and on behalf of the entire Gilead organization, would like to express my profound thanks to him for his many, many contributions. In terms of secession, Gillette is fortunate to have strong leaders across our R and D organization who will build on the tremendous success that we have had for over 3 decades.
I look forward to the leadership of John in his new role as Chief Scientific Officer and Head of R&D and Andrew in his new role as Chief Medical Officer. As we continue our work to invent and develop new products for patients in need. Turning to the business and results of the quarter. We continue to see strong growth in our HIV business driven by broad acceptance and uptake of our Descovy based regimens We are confident that this franchise will remain a key growth driver for the company moving forward. 1 of the products contributing to the growth is our latest Descovy based single tablet regimen, Biktarvy, formerly referred to as BIC Eptaph, which was approved in February, by the U.
S. Food And Drug Administration for the treatment of HIV. In March, biktarvy was added to the U. S. DHHS guidelines for the use of anti retroviral agents in adults and adolescents living with HIV as one of the recommended initial regimens.
Last week, we announced that the CHMP has adopted a positive opinion on the marketing authorization application for Biktarvy in the EU. We expect approval in the third quarter of this year. Biktarvy represents Gilead's 6 single tablet regimen and with the approval of Symtusa in the EU by our partner Janssen, the 4th containing Descovy backbone. Simptusa is currently under FDA review in the U. S.
Biktarvy is a combination of an unboosted integrase inhibitor and the well established backbone Descovy. Its small size minimal drug interactions and established renal and bone safety profile make Viktarvy an important treatment option for most HIV patients. This is particularly true for an aging HIV population, which is at increased risk for age related morbidities. In February at CROI, the conference on retrovibruses and opportunistic infections, one of the most important meetings for HIV research, had the opportunity to share our progress on the work we are doing to bring innovative therapies to people living with HIV. GILAS compounds were featured in 21 abstracts and data presentations, including promising preclinical results from our HIV GURE research program.
These data show that the combination of 2 investigational agents, GS9 620, a toll like receptor 7 agonist, and PGT-one hundred and twenty one, a broadly neutralizing antibody that binds to the HIV envelope, induced viral remission in the absence of antiviral therapy SIV infected monkeys and support clinical investigation of such combination strategies. Investigators also presented Phase III data in patients switching from a regimen containing abacovir, dolutegiver and lamivudine to Biktarvy and data from a multinational Phase III study of Biktarvy women a group that is often underrepresented in clinical trials. Data from these studies further demonstrate that Biktarvy may be appropriate for a wide range of people living with HIV. The data presented at CROI represent encouraging progress and demonstrate our continued leadership in driving innovation in HIV therapy. Moving to liver disease.
Our team recently attended the International Liver Congress in Paris, where there's a lot of emerging data around NASH and hepatitis B. The particular focus on NASH was very much like what we saw with the early breakthroughs in hepatitis C before the disease took center stage at the conference. John will share more specifics about EASL and the data presented there in a few minutes. In oncology, we We're encouraged by the response from the healthcare provider and patient communities to the life saving potential for Yescarta in people with aggressive large B cell lymphoma who have run out of option. We're seeing an increase expanded geographic reach come online.
We have now completed the authorization of 40 cancer centers and are on track have enough center certified to treat 80 percent of Yescarta eligible patients in the United States by the middle of the year. The future is incredibly bright for cellular therapy and we're excited to be at the forefront of the field pursuing a variety of approaches to develop the next generation of cellular therapies in blood cancers and solid tumors. As I look ahead to the remainder of 2018, we will continue to advance scientific innovation including progressing our robust pipeline, which has the potential to transform the treatment of NASH, inflammatory diseases and certain cancers. In addition, we will look for business development opportunities that add to our pipeline and capabilities across our therapeutic areas, diversify our portfolio, and increased future opportunities for growth. For example, earlier in the quarter, we announced an agreement with Sangamo on gene editing to create next generation cellular therapies.
And just yesterday, we announced another with Verily, better understand the immune system of patients in our clinical studies with Filgotinib. John McHustin will provide more details on these collaborations. I'm confident that our innovation and hard work will deliver on our goal developing new treatments for people living with some of the world's most serious diseases. And finally, tomorrow, we will publish our 2017 year end review that highlights our scientific advancements, sustainability initiatives community support programs and our continued efforts to improve public health globally. I'm proud of the work that's being led by our employees and extend my many thanks to them for all the ways they're making a difference around the world.
I will now turn the call over to John who'll provide additional updates on our R and D efforts. John?
Thank you, John. I'm honored to have the opportunity to lead our R and D organization, which has been at the forefront of scientific innovations for more than 30 years. Under Norbert's leadership, Gilead has brought forward 25 innovative treatments that have improved the lives of millions of people with serious diseases around the world. I am confident that our team will build on these remarkable accomplishments. I'd like to spend the next few minutes detailing our recent progress in liver diseases inflammation and cell therapy.
Beginning with liver disease, we continue to make excellent progress in NASH where our efforts are focused on treating patients with the most serious forms of the disease, those with advanced fibrosis. Who are at the highest risk to progress to end stage liver disease, liver cancer, and ultimately the need for liver transplantation. As we recently announced, STELLAR-three and STELLAR-four, our 2 ongoing phase 3 trials completed enrollment ahead of schedule. Both studies are evaluating selonsertib, our ASK-one inhibitor in patients with F3 and F4 stages of fibrosis. We now expect data from both support the safety at a statistically significant and clinically meaningful effect on fibrosis, we could file for regulatory approval towards the end of with compounds with distinctly different mechanisms of action.
In animal models of NASH, combination approaches have proven safe and have led to greater anti fibrotic responses compared to monotherapy. As John mentioned, at the International Liver Congress in Paris, Last month, there was a growing interest and focus on NASH. We have the opportunity to present promising early results from a proof of concept study exploring both single agent and combinations of Filonsertib with Gilead's ACC inhibitor GS0976 or our FXR agonist GS9674 in patients with NASH. Now the primary objective of this study was to determine the safety of combination therapy. Based on the 12 week study, our combination therapies were well tolerated and they offered additional benefits for improving NASH by reducing liver fat content, liver cell injury and other markers of fibrosis.
This is also the first study to show that GS9674 alone had activity in patients with NASH. Based on these encouraging data and supported by the preclinical results, Gilead has initiated a larger 350 patient Phase 2b study of combinations of Soloncilipe GSO976 and GS9674 in patients with advanced fibrosis due to NASH. The treatment duration will be 48 weeks with liver biopsies before and at the end of the treatment period. Another goal of our NASH program is to identify accurate non invasive tests that will hopefully allow healthcare providers to over identify those in need of treatment. At the presented data using 2 different machine learning methods on our earlier NASH studies.
The results indicate that non invasive tests can predict with a high degree of specificity and sensitivity the risk of clinical disease progression and separately improvement in liver histology. We will continue to investigate non invasive tests with the goal of replacing liver bio is for the diagnosis of NASH and for patient management. Moving to inflammation. I'm pleased to share that our 3 Phase III studies of Filgotinib, our JAK1 specific inhibitor in patients with rheumatoid arthritis, Finch 1, FINCH 2 and FINCH 3 are now fully enrolled. These studies are evaluating the efficacy and safety of filgotinib in biologic inadequate responder patients, mesotrexate inadequate responder patients, and treatment naive patients respectively.
We expect the FINCH 2 data will be available in the second half of this year, and FINCH 1 and FINCH 3 data will be available in the first half of twenty nineteen. Filgotinib is also being investigated in 2 other Phase III studies in Crohn's disease and ulcerative colitis that will enroll more than 2500 patients and also in a number of smaller Phase II studies in psoriatic arthritis, ankylosing spondylitis, cutaneous lupus, sjogren syndrome and uveitis. We expect to have data available from some of those Phase II studies during this year. Also yesterday, as John said, we announced an important scientific collaboration with Verily, the life sciences unit owned by Google's parent company, Alphabet, to accelerate our understanding of 3 common and serious inflammatory diseases, rheumatoid arthritis, inflammatory bowel disease, and lupus related diseases. Most patients with these immunologically driven diseases don't experience deep or long lasting remissions with currently available therapies.
There's clearly a need. Through this partnership, we will use Verily's immuno escape platform to interrogate lucose sites into more than 2 dozen component immune cell subsets and utilizing epigenetic and transcriptomic assays, we believe this technology could allow us to identify particular groups of patients that respond to specific therapies and also to potentially identify new drug discovery targets. Moving to cell therapy. We anticipate that the CATP will adopt an opinion for Yescarta in the second quarter and if positive, approval would follow likely in third quarter of this year. Given the innovative nature of CAR T therapies, The European Medicines Agency is evaluating the application under standard review to allow them sufficient time to review that data that we submitted with a Phase III randomized study comparing Yescarta to the standard of care, which is salvage chemotherapy followed by autologous stem cell transplantation in the 2nd line treatment of patients with diffuse large B cell lymphoma.
Zooma-seven is also the 1st global randomized phase 3 study of a CAR T therapy and will enroll 350 patients. Across fifty sites in North America and Europe. There remains a significant unmet medical need for patients with relapsed or refractory DLBCL after first line therapy. Selvage chemotherapy followed by Trans presentation cures only approximately 10% to 20% of these patients. If the Zuma-seven trial provides positive data in this setting, Yescarta has the potential to become an alternative option earlier in the course of the disease, thereby expanding the therapeutic potential of cell therapy for patients living with diffuse large B cell lymphoma.
We are also excited about our partnership with Sangamo Therapeutics which was announced in February. This agreement will allow our researchers access to Sangamo's zinc finger nucleases gene editing technology, which we believe will lead to the development of allogeneic T cell therapies that can be manufactured using the cells of healthy donors. The gene editing approach would reduce or eliminate some of the complications currently seen in allogeneic stem cell transplants such as rejection and graft versus host disease. Allogeneic therapies would also enable us to manufacture CAR T therapies that could be used universally. Providing people, particularly those who are very, very ill to access treatment much more quickly.
Combining gene editing with the synthetic biology tools we acquired with cell design laboratories last year, will also help us to develop treatments that can more precisely target hematological malignancies and solid tumors and make prove safer more effective and easier to manufacture. We have achieved a great deal across our R&D organization this quarter, and I am confident we will continue to make significant progress throughout the remainder of the year. In closing, I am excited to lead the talent Gilead R and T team going forward. I'm also looking forward to partnering with Andrew Chang in his new role and of course, with all my R and D colleagues. There has never been a more interesting time in science and medicine with extraordinary new discoveries on an almost weekly basis.
It will be our job here to leverage those advances and develop more effective and targeted therapies for patients with serious medical needs. I'll now turn the call over to Robin.
Thank you, John, and good afternoon, everyone. We are pleased to share our financial results for the first quarter of 2018. Total revenues for the first quarter were 5.1 This compares to revenues of $6,500,000,000 and non GAAP earnings per share Starting with HIV and HBV. Product sales for the first quarter were $3,300,000,000, up 2% year over year. And down 10% sequentially.
The year over year increase was driven by the continued uptake partially offset by the entry Sequentially, the decline was due to U. S. Sub wholesaler inventory reflective of the seasonal pattern from the fourth quarter to 1st quarter and the availability of generic versions of TDF in the U. S. Which impacted our HBV revenue.
Led by the continued uptake of Descovy based regimen. On a year over year basis, US HIV product sales grew 8% and total prescriptions for Descovy based and Truvada containing regimens grew 12%. Consistent with growth seen in each of our newest single tablet regimen for HIV was approved in the U. S. In February, and we are encouraged by the initial uptake among prescribers.
It's very early days, but launched to date, biktarvy is tracking very well against our expectations. With this trajectory, we anticipate over time, biktarvy will become the number one single tablet regimen for treatment naive and switch patients, a distinction currently held by Genvoya. Approximately 80% of Biktarvy's prescriptions came from switches, of which approximately 1 third came from Genvoya and twothree from other regimens, including approximately 20% from regimens that contain dolutegravir, confirming Biktarvy's broad utility across patient types. Similar to the launch of Genvoya, access to Biktarvy has been strong, with the vast majority of state ADAP and Medicaid programs now covering Biktarvy with coverage in additional state programs expected this quarter. Truvada for PrEP continued to grow with approximately 167,000 individuals taking Truvada for this indication in Q1.
In Europe, cells of Descovy based regimens comprised more than half of our HIV product revenues and continue to grow. Primarily driven by strong uptake in Gen Boya remained the number one regimen for Naive and switch patients across the EU5 collectively for the 4th consecutive quarter. Reflective of the strong physician Turning to HCB, product sales for the first quarter were $1,000,000,000, down 59% year over year, and down 30% sequentially. Consistent with our expectations in Q1, we observed a downward pricing and market share trend across the major geographies as a result of a more competitive environment. Price has now largely stabilized, and we expect market share to stabilize by midyear.
In addition, patient starts have become more predictable and we expect a slow and steady decline moving forward. We continue to see the HCB market as durable and albeit a smaller component of our revenues going forward. There are still many patients that remain to be treated. Our cardiovascular products, Renexa and Lateris, generated $399,000,000 in the first quarter. As a reminder, the patent for Ambrasinson in the U.
S. Will expire in July this year. And finally, sales of Yescarta were $40,000,000 in the first full quarter since approval in October. As John mentioned earlier, we are making great progress in training and certifying additional centers. In terms of access in the covered by commercial and fee for service plan and approximately 1 quarter of patients covered by Medicare.
There is broad coverage of the Escarta eligible patients with commercial insurance. It's encouraging to see the strong execution by commercial, medical affairs and manufacturing teams. The positive feedback from centers and the growing awareness Non GAAP R and D expenses were $814,000,000 for the first quarter, down 8% compared to the same period last year. Primarily due to our purchase SG and A expenses were $884,000,000 for the 1st full quarter, up 10% compared to the same period last year. Primarily due to costs associated with geographic expansion and increased expenses to support the growth of our business following the acquisition of KITE.
Moving to the balance sheet. And ended the quarter with borrowed in connection with our acquisition of KITE, paid cash dividends of 753,000,000 and repurchased 13,000,000 shares of stock for 1,000,000,000. The amount of shares repurchase was aligned to our stock compensation awards, which are largely granted in the first quarter and reflects a one time impact to repurchases related to unvested equity assumed from the KITE transaction. While our cash flows will remain strong for the remainder of the year, we anticipate a sequential decrease due to anticipated tax related payments. And we are reiterating our full Our confidence in the future is supported by a strong and growing HIV business led by the launch of Biktarvy in the U.
S. Increasing momentum in our cell therapy business and potential opportunities I would like to conclude by thanking our nearly 10,000 employees for their commitment to excellence and hard work that is well represented and the results this
We'll call on you on the order that you signal us. You. And our first question comes from Geoffrey Porges of Leerink. Your line is now open.
Thank you very much and I appreciate the question. John, on the Catches and congratulations on all the responsibilities. Maybe we could start off with a commercial question. But more seriously on the R and D side, could you give us the latest disclosure on PE and DVT events you've seen so far in the RA program for filgotinib. And then perhaps you could talk a little bit more generally about areas you're particularly excited about, in your new position that, that, do you think the company has the opportunity to invest in more aggressively.
Thanks.
Thank you, Jeff for the kind words. And for the question, so, regarding the first part of your question, the thrombo embolic event rates with baricitinib, the most recent data that we had shown was a presentation at ACR late last year Mark Genovese, which is an oral presentation. Now this is just from the DAR1, 23 extension studies. We have about 17 100 patient years of exposure, but that rate was very low. Only one patient in that presentation who had both a DVT and a PE.
So the rate actually in that presentation was 0.06 per 100 patient years. But Geoff, so far, we've got thousands of patients in phase 3. We've got a relatively ball data set in terms of exposure, but that's what we've said so far. We continue to collect all of that information. The other point to raise about this was the discussion recently at the advisory committee and whether this is slightly or partly related to JAK 2, as you know, Filgotinib is very selective for JAK 1.
And in terms of JAK2 specificity, we are we don't have that at all. So we don't see any changes in hemoglobin. We sit positive changes in hemoglobin. We don't see any increase in platelets. In fact, we see a small decrease in platelets, whether or not that's related thrombo embolic phenomena we don't know.
In terms of what we're excited about or excited about in R&D, Well, you know me, Jeff, I'm always excited about everything, but I mean, the opportunity to make a huge progress in cell therapy not just with Yescarta, which has enormous potential, but the future of cell therapy going forward, investing in researchers we have come forward with next generation products is really exciting for the organization to lead that entire field and we will continue to lead that and I will ensure that, as will Andrew and others in the organization as well. Additionally, I think we have a lot of opportunities in NASH. The ability to have a drug approved for an anti fibrotic endpoint in liver disease is it's never been done before and we clearly want to do that and there's a lot of patients out there with NASH. And then I believe, our fledgling programs that are now developing in full force in inflammation with Filgotinib in multiple diseases, are becoming differentiated, exciting, and heading in the right direction, particularly with things such as the Verily collaboration. So that's a long answer.
I'm sorry, Jeff.
Thank you. And our next question comes from Geoff Meacham of Barclays. Your line is now open.
Afternoon guys. Thanks for the question. So HIV franchise is really key to Gilead getting back to a growth company. So I was hoping you guys could give a bit more detail on the underlying demand trends in the U. S.
And Europe, just independent inventory fluctuations. I'm just I guess I'm trying to reconcile the 2% growth with maintaining guidance in the positive commentary? Thanks so much.
So, I'm going to let Andrew Stark was just giving you really the underlying details around the biktarvy launch. And then I'll kind of jump in with some of the revenue areas.
Jeff, it's Andrew. So I just want to touch on and reiterate some of the things that Robin mentioned during the call in her prepared remarks, primarily that when we look at biktarvy, we see 80 percent of biktarvy comes scripts come from switches. Of those switches, and 3rd are from Gen Boya and about 20% come from Dial Integra Bay regimens, both Tivicay and Triumeq. When we see the switches and as well as the naive patients trajectory overall, the right on target for what we predicted prior to the launch and really are in line for where we think biktarvy will ultimately end up as the top switch as well as naive drug in HIV and a position that's currently occupied by Genvoya. Right.
And Geoff, I'd add to that, but keep in mind that the launch for Biktarvy, we basically got 6 weeks of revenue. Currently in the quarter. So, while a partial quarter, we also had about half of it was related to inventory But underlying to your point, we're really excited with the overall launch of biktarvy and the success to date. The launch trajectory is looking very close to Genvoya. And over time we expect it to overtake Genvoya, as I mentioned, is the number one STR for naive and switch patients over time.
I think if you then turn and think about just Europe beyond Biktarvy, we're also seeing, as I mentioned, over 50% of our HIV sales came from facility based products in euro. And that's it seeding in advance of the fact that generics are wildly available. So to the point I made on the call and John made, we're really excited with the opportunity for HIV to be a growth business. That's inclusive of prep as well, but we're excited where we are for the for the year and for the opportunity to have this business via growth trajectory for us beyond 2018.
And our next question comes from Michael Yee of Jefferies. Your line is now open.
Hey, guys. Thanks for the question as well. 2 part question, on HIV, can you just perhaps quantify, how much inventory impacted the results. I think people are quite a bit concerned on the HIV numbers. So maybe just help out there relative to consensus $100,000,000 $200,000,000 or more of inventory.
And on hep C, there was a miss there. And I guess people are concerned about that relative to competition. So maybe just talk to that because you're reiterating the guidance. Thanks so much.
Sure. So, Michael, let me start with HIV inventory. The drawdown in inventory was primarily from our HIV products. But as I mentioned, if you look at underlying U. S.
Prescription growth overall, it was 12% year over year. And as I mentioned, 50% of our HIV revenues in Europe were comprised of Descovy containing regimens. So while we haven't quantified the dollar magnitude, the drawdown was larger than what we have seen in past quarters. Typically, if you go back the last eight quarters, we've had that Q4 to Q1 dynamic relative to inventory. So it is seasonal.
There were 2 key events this quarter that made that inventory decline greater than expected. 1 was availability of generic versions of PDF So therefore, wholesalers weren't carrying Verea anymore. And then 2, the anticipation of the Biktarvy approval. So lower stocking of both TAF and PDF containing regimen. Keep in mind, if you look at year on year and quarter on quarter growth, the availability of generic versions TDF and U.
S. Impact our HBV business. Overall, if we think about our big 3 wholesalers, we were in line relative to our inventory agreements. I'll remind you that we don't have agreements in place for the sub wholesalers. But again, just emphasizing that overall our underlying HIV growth remains strong, but we have the typical seasonal inventory driven by the two events that I just mentioned.
Yes. So the second part was on you.
Yes. So to turn to your second question on HCV, which the question
the competitive environment?
Yes, the competitive environment. I mean, I would say if you step back and think about where we are relative to our guidance and our expectations. When you reiterated guidance, it is pretty much playing out, playing out in line with our expectations. We talked about the fact of my comments that the U. S.
Pricing has largely stabilized and we expect market share to stabilize by midyear. I would say Michael that the ex U. S. Competition has intensified, but I'd also say that competition with more intense environment, prior to the launch of a competitor and remains to be. So we do believe overall hepti is a long and durable market.
We'll continue to, compete very aggressively with our competitor. The guidance that we provided at the beginning of the year.
Thank you. And our next question comes from Brian Abrahams of RBC Capital Markets. Your line is now open.
Hi, thanks for taking my question. And my congrats to Norwood on all your accomplishments and to Andrew and John your new roles and responsibilities. A question on Yescarta, as we try to gauge avenues of continued growth there this year and beyond, maybe help us understand the proportion of centers that are operating at high throughput and perhaps how far along in infrastructure establishment those additional centers that you expect will be authorized are going to be relative to those already online. And then I guess I'm also just curious on revenue recognition there. Related to relative to reimbursement, how we should be thinking about that?
So, I'll start, Brian. I would say you're right. It's early days. So we're not going to get into throughput discussions or specifically what we're seeing at every center. We're really pleased with our full first quarter revenue We've talked about this being a very measured launch with our focus being this year on getting centers authorized and being sure that their experience with Yescarta meets the expectation of the centers and the patients.
So I mentioned we have 40 centers authorized, and we expect by midyear that we'll have coverage for 80% of the eligible Yescarta patients as we continue to ramp up sensors. Relative to revenue recognition, no overall concerns there. We're seeing good reimbursement overall from for both, commercial as well as Medicare patients. So We're really comfortable where we are with the launch today.
Thank you. And our next question comes from Matthew Harrison of Morgan Stanley. Your line is
I guess, one, with HCV price stabilize, and I wonder if you'd just give us some idea of where that stabilized relative some of the prior comments you've made around what the average price was across the regimens. And then, if I can ask a separate question for John McHutchison, related to the UC program for Filgotinib. I believe there's a you have a futility analysis to move from phase 2 to Phase III, could you just talk a little bit about, what the bar is and what the hurdle is to move into the Phase III program and how you're thinking about that?
So, I'll start, Matthew. I think the main change that you saw in Q1 in that step down as we talked about, on our February call was related to Medicare, in the U. S. So as I as we mentioned, this call in the prior, we expected that step down with the price adjustment as we move to
And Matthew, the second part of the it's John McHutchison. The second part of the question was about the futility interim analysis for the selection, Filgotinib ulcerative colitis Phase III study. Just to remind you, the reason we did this futility analysis is we hadn't studied filgotinib in ulcerative colitis in phase 2. We had in Crohn's disease in the Fitzroyd study, and we have obviously had, data in rheumatoid arthritis. But we had to have an interim analysis, in the ulcerative colitis study to make sure that we were on track.
And that analysis is planned without getting into all the details, coming up this shortly this year. It's based on the week 10 induction time point and the endoscopic response and improvement in endoscopic response and the 2 groups of patients that are enrolled in the trial those that are naive and those that are biologic non responders. So I'll leave it at that, I think, to answer the question. And We'll see how it goes.
Thank you. And our next question comes from Robin Karnauskas of Citi. Your line is now open.
Hi guys. Thank you for taking my question. So just one quick question on HCV. You did not reiterate HCV guidance is I'm curious whether or not that's reiterated as well. And then on Discarta, just trying to understand a little bit about what you're seeing in the real world on safety, given that it will be facing some competition, are you seeing safety in line with your clinical trial work or on side effects that are not as common?
Thanks. So Robin, I'll take the first question regarding guidance. We didn't give specific HCV guidance. But again, if you take a look at our revenues and you look at the component that we provided in our guidance overview last quarter were pretty much in line. And at the high end of that guidance overall was $1,000,000,000 plus in global HCV revenues.
And we did reiterate our total guidance, which is how we guided this year on total net product revenue. Relative to safety on Yes.
Robin, it's John McCarthy. Hello. So yes, I've been talking to some of the team members in Santa Monica the last couple of days. And in general, there's nothing untoward that's been observed to my knowledge as well outside of clinical trial.
Thank you. And our next question comes from Umer Raffat of Evercore. Your line is now open.
Hi, this is Regina Grubla on for Umer. Thank you for taking our questions. So first, many investors think that you're in an earnings trial this year. Do you think that you're in an earnings trough? And NASH is emerging as an important catalyst in your pipeline.
We saw some data from Allergan at EASL where page in their placebo arms seesaw between fibrosis stages. We do recognize that the Allergan study enrolled earlier fibrosis stage patients in F3, but how much of do you think this could be in your Phase 3 program? Thank you. Hi, Regina. So I'll start off.
As I mentioned on the call, I think off to a great start. We've reiterated guidance and the year is progressing in line with our expectations. We do believe that 2018 is a trough year for us on which we can grow. We'll have seasonality fluctuations from quarter to quarter, but we're very confident since we integrated our overall guidance for the year and expect to be able to grow off of our 2018 base going forward.
Hi, Regina, it's John Mecustom in terms of the second part of your question, in relation to variability in placebo response rates, it is an issue with liver biopsy Well, we know there's a 30% variability. If you have 2 pathologists read the same liver biopsy, And I think some of the presentations you referred to at AASLD might be partly reflecting that. So it's an imperfect tool with Beth, but what we have in terms of drug approvals for NASH patients. We have had the fortunate opportunity of being able to address this our previous SYM2s in that trial enrolled many hundreds of patients. Now the drug didn't work.
Unfortunately, but we have a lot of patients with 2 liver biopsies a long time apart. So we are very, very confident of what we expect see in F3 and F4 patients in terms of the placebo response rate in terms of a fibrosis improvement score of one point with no worsening of NASH. So we have that number, and that is what we've used to calculate our power. And our sample size in our STELLAR-three and STELLAR-four programs.
Comes from Phil Nadeau of Cowen. 2 follow
questions on the commercial side. So first on HCB, just to maybe ask Robin's question in in a different way. On slide 35 of the slide deck you ended out on the last call, you did give a range for 2018 expected ACV sales of 3.5 $4,000,000,000, even if that wasn't formal guidance. And you said that the decrease versus the $9,100,000,000 from 2017 would be due to about a $1,000,000,000 hit for from total market patient starts and $4,300,000,000 to $4,300,000,000 hit from the competitive environment. So if you kind of redo that slide today given what you've seen in Q1, would those numbers still hold?
Would you still expect the same hit from market starts competitive environment leading to the same 2018 range. And then just briefly on biktarvy, I know you said that the access was good. We've heard from physician consultants that insurers are requiring prior auths and other methods, early in the launch of HIV products. What are you seeing in terms of, of, prior oils from insurance plans for Biktarvy? Thanks.
Hi, Phil. So I'll take the first part and then turn it over to Ann for Biktarvy. So, yeah, looking at page at the slide that you referred to, and again, I'll reiterate our CB revenues for the quarter were $1,000,000,000. So if I think about what we talked about, the reason for the step one being priced, right, because we did the new contracting in Q1. That would fall under competitive environment as well as thinking about share.
I mean, the combination of those 2 make up competitive environment starts. We've talked about them being a slow and steady decline. So yes, I believe this slide is is intact and it's included in our overall reiteration of our guidance for the full year of $20,000,000,000 to $21,000,000,000.
So, Phil, it's Andrew. So we'll switch gears and you were asking about prior authorizations, with Biktarvy. I think as you're well aware that when any new product launches that there is some degree of prioritization as they start to review the product. However, as John mentioned on his initial remarks of the call, on March 27th, the DHHS guidelines placed the PtB top tier of its recommended initial regimens list. Since that time, we've got we've received some feedback that the amount of prior authorizations has really decreased and it's become less of an impediment and that taken together that helps put us to and reiterate what Robin said earlier on the call that we have every expectation that the biktarvy will match and then exceed Genvoya when it comes to number 1 position for both naive and switch patients.
Thank you. And our next question comes from Terence Flynn of Goldman Sachs. Your line is now open.
Hi, thanks for taking the question. I was just wondering maybe John McCutchessen, if you can discuss the importance of 1st mover advantage for Yescarta and DLBCL versus any potential modest benefit that a future competitor might have on CRS. I'm just wondering how you think about that. And then maybe one for Robin. HIV pricing in Europe.
Have you guys seen any change in the pricing dynamics on the branded side given the entry of generics? Thanks a lot.
Hey, Terence. It's John McHutchison. Hello. Thank you for the question. I think the first mover advantage is important.
We have the relationships. We have the experience now in the community, particularly in the U. S. Which will obviously extend elsewhere. So I think it's an important advantage as it has been for us in other diseases, including HIV and and hepatitis C where we were fortunate to be first as well.
So it's a brief and general answer, but I think it is important.
Terence, it's Andrew. So I'll touch on the impact in Europe and what we've seen. Generics for VIRIA TDF are available in Europe. And we have seen some impact on certain pricings in certain countries. However, I think it's important to recognize that over 50% of our European revenues come from TAF based products.
And you can see, as we mentioned on the last call, that in certain countries, the conversion rate from TDF to TAF products like Germany exceed 70%. So I think when one thinks about the impact, we've already made that switchover for a large for a number of countries and that impact is somewhat muted.
Right. And Terrance, to follow on to that, we priced Jamboyah at parity with Stry Build. So our ability to get early access in those markets where we've launched has been helped in help that overall transition that Andrew just referred to as creating that 50% being Descovy regimens overall.
Thank you. And our next question comes from Cory Kasimov of JP Morgan. Your line is now open.
Hey, good afternoon guys. Thanks for taking my question. It's on Yescarta. And I'm wondering, is the $40,000,000 in sales in Q1 pretty evenly distributed across your 40 authorized centers? Or is it more concentrated in a handful of them?
And then just in general terms, should we be thinking about the patient capacity per center as something that also gradually evolves over time?
Hi Cory, it's Robin. I'd say again, it's early days relative to our center of being certified and getting launched to get really get at a throughput per center or any of those type of metrics. And I also say that because this is such a specialized treatment, we've selected centers that we think can be successful. We're helping them through that. Yes, some of the earlier centers we're seeing higher volumes in you would anticipate.
But I think the volume is not just determined by saying you're now certified. It's just determined by the hospital and their resources and looking at the other various treatments, etcetera, and other capacity centers that any hospital has to manage. So it's going to be harder, particularly in this therapeutic area to provide the level of detail and granularity or at this stage, details by center. Of the $40,000,000 was very robust for us. We're happy with the results today.
And as I mentioned, this is going to be a controlled measured launch for us. And we're going to continue in that process and provide you updates on that as much as we can.
Thank you. And our next question comes from Alethia Young of Credit Suisse. Your line is now open.
Hey guys, thanks for taking my question and congrats, John and Andrew. This is more on a commercial standpoint, just kind of big picture. So biktarvy has taken like roughly 80% switch from Gen Boya. I just kind of wanted to think about broadly, should we think Jim Voya kind of continues to grow or does it kind of inflect and then biktarvy kind of picks up where Jim Voya lets leap left off? Or is it just the case that the 80 percentage Biktarvy switch most likely may moderate a little bit, so that trend may not be as pronounced?
So, Alethia, let me just clarify something in your call just to recognize that when we think about biktarvy scripts, 80% come from switches, about a third of those come from Genvoya. So, I think when we think about it, a third from Genvoya, then about 20 from dolutegravir based regimens, either Tivicay, or Triumeq. And then the remainder of the switches come from a mix of different regimens. So when we think about it overall, I think we're very happy with the mix and given our robust development plan, where 2 of the 4 studies were based on switch, 1 from Triumeq, the 1 from Proteus and Hiver based regimens. We expect that that MYC to actually to be the same going forward about an eightytwenty switch given the overall dynamics.
Now there's certainly going to be some degree of variability from quarter to quarter into the portion of this Genvoya versus, dolutegravir based regimen, but certainly we're very comfortable with where we are and expect that the overall growth of Biktarvy to continue, as we mentioned earlier.
Thank you. And our next question comes from Salim Syed of Mizuho. Your line is now open.
Hi guys, thanks for taking the question. Just one on Yescarta. Could you just maybe comment on what sort of education you guys are doing with the medical community for the non CAR T oncology docs? And if these docs are actually referring patients to the CAR T centers after which line of therapy in general? Thank you.
It's John Milligan. I just wanted to it's actually a very timely question. So as you know, we've been out in the community detailing Xydellate. And we've just recently taken those representatives, our therapeutic specialists and put them through specific CAR T training so that they can start to have a conversation with doctors in the communities about what CAR T is what kinds of patients are eligible for CAR T and can help them with referrals. I don't know specific hurdles, but certainly encouraging doctors.
To refer those patients who would be eligible to specialists who then can handle those cases. So we are starting an educational campaign in the community that really kicked
Camiro Lynch. Your line is now open.
Hi, thanks for taking my questions. The first one I have related to the data you presented at meso. So if you look at the MRI PDFF data, it seems that the asthma inhibitor does not appear to be very potent compared to the ACC inhibitor or even FXR. So, just wondering based on that, how much confidence do you have on the ultimate success of the Phase III trials for FY STELLAR-three and four trials? And then maybe Robin, can you elaborate a little bit on the ex U.
S. Dynamics for HBV because it appears that AVI has enjoyed very much success in launching Mavirad in the ex U. S. Based on the numbers reported. I was wondering if you see that evolving in the next few quarters where you can gain back shares for Matthew or not?
Thank you.
Hello, Ying. It's John McCutcheson. To answer the first part of question. The observation you made and noted in our EASL presentation that Soloncidib has less of an effect on steatosis. In the livers than our ACC inhibitor that inhibits de novo lipogenesis is exactly what we wanted to see and expected to see.
Because of the mechanism of action. Soloncitib doesn't have a primary anti lipotoxicity effect. It's an anti ASK and it works on hepatic stellate cells as well. So that's what we expected to see. In terms of the second part of your question, does that give us more or less confidence, in terms of our phase 3 STELLAR programs, I think you need to take the context of what we presented at EASL in a 12 week study, and think about it in the overall context.
What we did in all of these programs is we did Single agent small studies first to show that each drug was effective, which we've done for all of our 3 drugs. Then we did a small combination study to see if there was combination safety. That's what we presented at EASL. We did, however, also present some of the parameters that you've been talking about. But our goal was always once we had combination safety to then be able to kick off a definitive, larger study with a longer duration of therapy to determine which of those, drugs is safer, which is what we're doing.
To get back to the selonsertib question, we decided to do a Phase III selonsertib study based on a previous study that we presented last year that was 24 weeks in duration that had 2 liver biopsies. It showed a dose dependent effect on the regression of fibrosis and an inverse relationship to the development of cirrhosis We also showed that the target P Fosso P38 is upregulated in NASH patients and it's also blocked or inhibited or down regulated by the drug. So everything is heading in the right direction. And I think what's happening here is people are taking this small 12 week experiment that was due and looking at combination safety out of context, when we started our STELLAR Phase III program, it was based on a larger Phase II study to biopsies 6 months apart. That showed a definitive effect on fibrosis.
So I we are in good shape. I'm excited about the results. We've enrolled them ahead of schedule. And we look forward to getting the results early next year.
Thanks, John. And I think again, your other question related to ex U. S. HCV sales. So let me start by saying I think that's always been a much more competitive environment compared to the U.
S. The OUS sales as we compare what we did relative to our competitor includes a wide variety of geographies, including Europe, Japan, and Asia. And I would say the market share is very they're very different from country to country. I think it is fair to say that we've seen our competitors do very well in Japan, for example, with some of the prior DAA failures and some warehousing there. But there or other countries where we're doing well.
And we're going to pick our opportunities to focus on. We while we know this is a competitive market, we we have the field force and necessary folks in place to be competitive. And as mentioned, I think we're on track and relative to where we expect it to be, we see things playing out very close to that. So, as I also said, we expect our share to stabilize by mid year. So I think we'll be able to provide more insight around share going forward, during the next call.
Thank you. And our final question comes from the line of Carter Gould of UBS.
I was looking to get some clarity on the regulatory strategy for filgotinib and investors should expect you to file, I guess, following that the Finch 1 and FINCH 3 data become available or will you look to wait for maybe one of the GI focused indications to have that phase 3 data
in hand as well? Thank you.
So, Carter, it's John McHutchison. Thank you for the question. So, As I said today in my prepared notes that we now are in the fortunate position to have all FINCH 3 trials enrolled. Both mesotrexate naive and inadequate responders and our biologic non responders. So we can file if the data supports it, of course, we can file for RA with all of those 3 studies and they are on a different timeline from the inflammatory bowel disease studies.
So we would not wait for the inflammatory bowel disease studies.
Thank you. And that concludes our question and answer session for today. I'd like to turn the conference back over to Sung Lee for any closing remarks.
Thank you, Candice, and thank you all for joining us today. We appreciate your continued interest in Gilead and the team here looks forward to providing you with updates on our future progress.
Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program and you may all disconnect. Everyone have a great day.