Welcome to the Gilead Sciences, Inc 2025 annual meeting of stockholders. I would now like to introduce you to Daniel O'Day.
Good morning, everyone. I'm Daniel O'Day, Chairman of the Board and Chief Executive Officer of Gilead Sciences, and I'm pleased to welcome you to Gilead's 2025 annual meeting of stockholders. Before I call the meeting to order, I'd like to introduce you to some of the members of the Gilead team. Joining us today are the members of the Board of Directors: Anthony Welters, our Lead Independent Director; Jacqueline Barton; Jeffrey Bluestone; Sandra Horning; Kelly Kramer; Ted Love; Harish Manwani; Javier Rodriguez. We also have several members of our leadership team here this morning. We have Andy Dickinson, our Chief Financial Officer; Johanna Mercier, our Chief Commercial Officer; Dietmar Berger, our Chief Medical Officer; Cindy Perettie, our Executive Vice President of Kite; and Deborah Telman, our Executive Vice President in Corporate Affairs and General Counsel, as well as Jacquie Ross, our Head of Investor Relations.
Also joining us today are Richard Jackson and Casey Hayes from Ernst & Young , our independent auditor. Deborah Telman will serve as our Secretary for this meeting. We will first conduct the formal business of the meeting as described in our proxy statements. The meeting will run in accordance with the agenda and the procedures set forth in the Rules of Conduct and procedures posted on the virtual meeting portal. There'll be an opportunity to submit questions and comments related to the items of business of the meeting, which will be addressed during the formal portion of the meeting. After the formal portion of the meeting is concluded, we'll provide an overview of Gilead's business activities and address questions relating to the company.
In either case, questions or comments may be submitted in the designated field on the virtual meeting portal by stockholders who have logged in with their 16-digit control number. If you experience any technical difficulties during the meeting, please call the technical support number posted on the virtual meeting website. In the event we experience any technical difficulties before the conclusion of the formal business of the meeting, we may temporarily adjourn and reconvene the meeting in accordance with our bylaws. It is now shortly after 10:00 A.M. Pacific Daylight Time on May 7th, 2025, and this meeting is officially called to order. The Board of Directors has appointed Cristina Vico of Vico Group to act as Inspector of Election for this meeting. Ms. Vico has taken and subscribed the customary Oath of Office to execute her duties with strict impartiality.
We will follow this oath with the records of the meeting. Her function is to determine the qualifications of voters, accept their votes, and when balloting on all matters is completed, to tally the ballots cast as to each matter. Will the Secretary please report on the stockholders' list and the mailing of the meeting notice?
I have a complete list of the stockholders of record of the company's common stock on March 14th, 2025, the record date for this meeting. I also have an affidavit from Broadridge certifying that a notice of annual meeting of stockholders of the company was disseminated to all stockholders of record on the record date.
Will the Secretary please report on the existence of a quorum?
I have been informed by the Inspector of Election that proxies have been received for 1,121,336,290 shares of the 1,246,634,469 shares of common stock outstanding on the record date, which represents approximately 89.9% of the total number of outstanding shares. This constitutes a quorum for the transaction of business.
I hereby declare the polls open for voting.
Only matters for which notice has been given in accordance with our bylaws may be brought before the annual meeting. Those matters are described in the proxy statement relating to this meeting. Any stockholder who has not yet voted or wishes to change their vote may do so by clicking on the voting button on the virtual meeting portal and following the instructions there. Stockholders who have voted prior to the meeting by proxy, telephone, or internet and do not want to change their vote do not need to take any further action.
After presentation of all matters, I'll open the floor for questions or comments on those items of business in order to ensure that the business of the meeting proceeds in an orderly fashion and that stockholders who wish to participate have a fair opportunity to do so. Please limit your questions and comments to the items of business listed on the agenda. There'll be an opportunity to submit questions and comments on other matters relating to the company following the conclusion of the formal meeting.
The first item of business is the election of nine director nominees named in the proxy statement to serve for the next year and until their successors are elected and qualified. The director nominees are Jacqueline Barton, Jeffrey Bluestone, Sandra Horning, Kelly Kramer, Ted Love, Harish Manwani, Daniel O'Day, Javier Rodriguez, and Anthony Welters. Each a current director of the company, the Board of Directors has recommended a vote in favor of each of the nominees. The second item of business is the ratification of the selection of Ernst & Young LLP by the Audit Committee of the Board of Directors as Gilead 's independent registered public accounting firm for the fiscal year ending December 31, 2025. The Board of Directors has recommended a vote in favor of this proposal.
The third item of business is the approval on an advisory basis of the compensation of our named executive officers, as presented in the proxy statement. The Board of Directors has recommended a vote in favor of this proposal. The fourth item of business is consideration of a stockholder proposal requesting the CEO pay ratio factor be included in the company's executive compensation programs. If properly presented at the annual meeting, the Board of Directors has recommended a vote against this proposal for the reasons set forth in the proxy. Mr. Zheng Zhao will present the proposal.
Mr. Zhao, your line is now open.
Good morning, fellow shareholders. Since we all read my proposal, there's no need to repeat the contents. I would like to express some supplements.
Mr. Zhao, we are unable to hear you.
I have had similar proposals voted at many companies' shareholders' meetings since about 10 years ago. I just drove to Omaha to present my same proposal at Berkshire Hathaway shareholders' meeting last Saturday. I know how easily to abuse data to make up different results, assuming all companies' executive compensation program to make simple sense complicated and misleading. Second, there's no need to hire outside firms to say what the board wanted to hear because all outside consulting firms manipulate the data to increase the compensation result. Last, in January, according to Wall Street Journal, April 23rd, 2025, the wealthy have gotten richer and controlled a record share of Americans' wealth . New data suggests that $1 trillion of wealth was created for the 19 richest American shareholders alone in 2024. This trend is not sustainable for American corporate and the economy because it is against our human nature.
Please vote for my proposal number four. Thank you very much.
Mr. Zhao, the Board's opposition statement for the stockholder proposal has been included in the proxy statement for all stockholders to consider. The fifth item of business is consideration of a stockholder proposal requesting an independent board chair policy if properly presented at the annual meeting. The Board of Directors has recommended a vote against this proposal for the reasons set forth in the proxy statement. Ms. Kim Franklin will present the proposal.
I will now open the line for Ms. Franklin.
Good morning. Can you hear me okay?
Yes.
Proposal five supports an independent board chairman sponsored by John Chevedden. Shareholders request that the Board of Directors adopt an enduring policy and amend the governing documents as necessary in order that two separate people hold the office of the chairman and the office of the CEO. Selection of the chairman of the board. The board requires the separation of the offices of the chairman of the board and the Chief Executive Officer. Whenever possible, the chairman of the board shall be an independent director. The board has the discretion to select a temporary chairman of the board who is not an independent director to serve while the board is seeking an independent chairman of the board on an accelerated basis. This policy could be phased in when there is a contract renewal for our current CEO or for the next CEO transition.
A lead director is no substitute for an independent board chairman. A lead director cannot call a special shareholder meeting and cannot even call a special meeting of the board. A lead director can delegate most of his lead director duties to others. Previously, this proposal topic received 44% support from Gilead Sciences shareholders. With the current CEO serving as the chair, this means giving up a substantial check and balance safeguard that can only occur with an independent board chairman. Please vote yes, support an independent board chairman proposal number five. Thank you.
Thank you, Ms. Franklin. The Board's opposition statement for the stockholder proposal has been included in the proxy statement for all stockholders to consider. The sixth item of business is consideration of a stockholder proposal requesting a comprehensive human rights policy and human rights due diligence process if properly presented at the annual meeting. The Board of Directors has recommended a vote against this proposal for the reasons set forth in the proxy statement. Ms. Lydia Kuykendal has submitted a pre-recorded presentation of this proposal. Operator, please play the recording.
Good morning. My name is Lydia Kuykendal, and I am here on behalf of Mercy Investment Services to present proposal number six, requesting a comprehensive human rights policy and human rights due diligence process. The right to health is enshrined in international human rights principles. The World Health Organization's Constitution states, "The enjoyment of the highest attainable standard of health is one of the fundamental rights of every human being without distinction of race, religion, political belief, economic, or social condition." The UNGPs also explicitly state that companies must conduct human rights due diligence to identify and address adverse salient risks and adverse impacts connected with their products and services, particularly if the scale and scope of the impacts are likely to be large. Such an approach should certainly be applied to the company's most important business consideration, that of pricing and access to medicines.
The statement of opposition states that a separate human rights policy is redundant and unnecessary. It then lists various codes of conduct and other reporting unrelated to human rights. The fact that they are out of step with peer companies such as Bristol-Myers Squibb, Pfizer, and Moderna illustrates the industry understands a supplier code of conduct is not a sufficient replacement for a robust human rights policy. In fact, several direct industry peers have not only better policies but better due diligence and assessment models in place. While not perfect, Sanofi, Novartis, and Novo Nordisk all disclose processes that describe their commitment not just to a human rights policy but to diligence and assessment of that policy. The company says that, "We believe human rights is an important issue that is not static," but then provides no disclosures around any process that would demonstrate that sentiment to be true.
While the commitments are laudable, they ring hollow when the company doesn't lean into this very commitment to examine the core of its business, which is getting its products to patients. Gilead also claims that, "We understand that making the world a healthier place for all people means going beyond the medicine to help remedy health inequities and other barriers to care." We believe that to fulfill this pledge, the company must commit to human rights due diligence and disclose the results of that diligence on the impacts of its operations, activities, business relationships, and products related to access to medicines. For these reasons, we ask you to vote for proposal number six. Thank you.
Thank you, Ms. Kuykendal. The Board's opposition statement for the stockholder proposal has been included in the proxy statement for all stockholders to consider. The seventh item of business is consideration of a stockholder proposal requesting a report on the risk of the company's DEI practices for contractors if properly presented at the annual meeting. The Board of Directors has recommended a vote against this proposal for the reasons set forth in the proxy statement. Mr. David Bahnsen has submitted a pre-recorded presentation of this proposal. Operator, please play the recording.
Hello. My name is David Bahnsen. I'm a financial advisor, a Gilead shareholder, and an investor, but I'm not a shareholder activist. I make investment decisions in accordance with my duty to clients to optimize their financial results. I do not seek to use my influence to pull companies into various political or social causes, as is so often done through these shareholder resolutions. My intention in this proposal is the opposite: to further shareholder interest by getting politics out of the company, not by pushing more politics onto it. The inherently political nature of Gilead 's commitments to diversity, equity, and inclusion is clear. The question is, does Gilead 's focus on supplier diversity muddle its fiduciary duty? Gilead 's corporate partnerships require it to incorporate diversity programs into its supply chains.
Gilead 's own policy answer is that a broad and inclusive supplier network supports socioeconomic inclusion across our society. That doesn't answer the question. It begs the question around those very diversity commitments we are asking about. Gilead 's current policy suggests it prioritizes the diversity of its suppliers over a meritocratic approach that enhances shareholder return. If this is not the case, then the proposal is an excellent opportunity to correct the record. If it is the case, we want that transparently stated so that we can aggressively make the argument that any ethos that minimizes achievement, productivity, and true value creation is deeply out of bounds for a company like Gilead . The pioneering and innovative success Gilead has had in HIV treatments, oncology, and other key elements of life and health sciences are driven by meritocratic commitments at the company's science, talent development, research, and development.
We plead with Gilead not to compromise this ethos when it comes to supplier decisions when meritocracy has served the company so well in other core categories. These matters of public controversy deserve more than a restatement of Gilead 's existing policy, particularly when the existing policies are the risk factor. The reputational risks of DEI commitments are well demonstrated, and the rapidly evolving legal and regulatory landscape around workplace diversity efforts is an additional point in favor of caution and fiduciary duty above all else. That's the point of this proposal, asking our company to take these concerns about its approach to suppliers seriously. Above all, we seek to avoid activism, focus on serving customers at a profit, all of which accrues to the benefit of the owners. Thank you very much.
This concludes the playback.
Thank you, Mr. Bahnsen. The Board's opposition statement for the stockholder proposal has been included in the proxy statement for all stockholders to consider.
We will now turn to questions or comments submitted by stockholders through the virtual meeting portal that are related to the items of business listed on the agenda. As a courtesy to the other stockholders present, please limit yourself to one question or a comment of reasonable length.
Thank you. Our question is, can Gilead confirm that it does not use racial, gender, or sexual identity quotas in any of its supplier programs?
Our supplier practices are designed to comply with the law and provide equal opportunity to all, consistent with Gilead 's commitment to inclusive practices. Our compliance program regularly monitors and evaluates our practices, policies, and goals concerning compliance with law to address evolving compliance risks. We seek to operate in compliance with applicable nondiscrimination laws in the U.S. and in other jurisdictions in which we operate. We believe that our inclusion efforts are legally appropriate. Gilead 's commitment to the principles of inclusion is longstanding and integral to how we do business. Our philosophy of inclusion stems directly from our core values.
Thank you. Chairman, we do not have any additional questions relating to the proposal.
Thank you. The polls will be closing momentarily. We'll pause for a moment here. It is now 10:20 A.M. Pacific Daylight Time, and I hereby declare the polls closed. Will the Secretary please provide a preliminary report on voting?
I will now report on the voting of stockholders at this meeting. Each share of common stock is entitled to one vote on each matter to be voted upon at the annual meeting. The voting was conducted by proxy, written ballot, and through our virtual meeting portal. The preliminary report of the Inspector of Election is as follows. The director nominees named in the proxy statement have been elected, with at least approximately 93.4% of the shares voting in favor of each nominee. The selection of Ernst & Young by the Audit Committee of the Board of Directors as Gilead 's independent registered public accounting firm for the fiscal year ending December 31, 2025, has been ratified with approximately 92.9% of the shares voting in favor.
The advisory vote to approve the compensation by named executive officers, as presented in the proxy statement, has been approved with approximately 91% of the shares voting in favor. The stockholder proposal requesting the CEO pay ratio factor be included in the company's executive compensation program has not been approved with approximately 8% of the shares voting in favor. The stockholder proposal requesting an independent board chair policy has not been approved with approximately 36.2% of the shares voting in favor. The stockholder proposal requesting a comprehensive human rights policy and human rights due diligence process has not been approved with approximately 35.9% of the shares voting in favor. The stockholder proposal requesting a report on the risk of the company's DEI practices for contractors has not been approved with approximately 1% of the shares voting in favor.
The final results of the voting will be reported in Form 8-K within four business days from today.
This concludes the formal portion of our meeting. After adjournment, I'll provide an overview of Gilead's business. Following the presentation, we'll take questions and comments from stockholders through the virtual meeting portal. This meeting is now adjourned. Now we'll transition to an overview of our overall business. First, I want to remind you that our presentation will include forward-looking statements. I refer you to the disclaimer in the presentation, as well as our SEC documents, for a full discussion of the risks and uncertainties associated with these statements. On behalf of the team, I'm pleased to share that Gilead's in a strong position with significant positive momentum. This follows a year of outstanding top-line performance, along with exceptional bottom-line growth that highlights our commercial execution and operational leverage in our business model. This was the case for 2024 as a whole, and the story now continues into 2025.
On this slide, you'll find some of the highlights across our business that point to the strength of our diverse portfolio and why we are in such an advantageous position as we look to the rest of the year and beyond. Our level of confidence is driven first and foremost by the strength of our underlying business. Gilead has continued its track record of strong commercial execution with our base business growing 8% in 2024. Our HIV sales grew 8% in 2024 to $19.6 billion, significantly ahead of our guidance of 5% growth and driven by increasing demand for our market-leading therapies. We expect that this demand-led volume growth will offset the approximately $1.1 billion in headwinds related to Medicare Part B redesign that we knew to expect in 2025. Building from the strong commercial base, we also have multiple potential launches ahead across virology, oncology, and inflammation.
Starting with virology, we are now weeks away from the anticipated regulatory decision on lenacapavir, our groundbreaking twice-yearly prevention for HIV. This is a therapy that has garnered worldwide attention as potentially being the most powerful tool yet for ending the HIV epidemic and could be launched this summer. Lenacapavir was recognized by Science magazine as its Breakthrough of the Year for 2024 and received breakthrough therapy designation and priority review from the FDA. Behind lenacapavir, we have many more potentially transformative therapies advancing through the pipeline, which could generate up to nine HIV product launches by the end of 2033. Moving to oncology, we recently added another potential launch to the list following the positive top-line results from our phase III study of TRODELVY for first-line PD-L1 positive metastatic triple negative breast cancer. The results are both clinically meaningful and highly statistically significant.
We expect to share the detailed results as a late breaker at ASCO with a potential for launch in 2026. In addition, we anticipate potentially launching Anito-cel in 2026 for fourth-line and beyond relapsed/refractory multiple myeloma in 2026. Anito-cel is potentially a best-in-class cell therapy with a differentiated safety profile. We have 11 oncology programs in phase III in total and look forward to updating you on our progress. In inflammation, our launches of Livdelzi for PBC in Europe are ongoing following a successful U.S. launch in August of 2024. In the longer term, our strong and diverse pipeline is designed to drive future growth with many exciting targets across our core therapeutic areas. Many have mechanisms of action with established proof of concept, have combination potential, and/or have potential for multiple indications.
This momentum, alongside Gilead 's strong balance sheet, robust cash flow, continued commitment to operating expense discipline, and no major LOEs until 2033, position us well to adapt to a range of macro-economic and policy outcomes. Our focus remains on execution and on our financial performance, which will drive shareholder returns. In 2024, we returned $5.1 billion to shareholders through dividends and share repurchases, and our capital priorities for 2025 remain unchanged. We'll continue to pursue disciplined use of capital and careful investment in the most promising pipeline opportunities, both internally and externally. In summary, we are continuing into 2025 with confidence in our ability to drive further value for all stakeholders, including patients, society, and investors. Now we would like to take questions and comments submitted through the virtual meeting portal.
As a courtesy to the other stockholders present, please limit yourself to one question or a comment of reasonable length. Questions will be addressed in accordance with the Rules of Conduct and procedures posted in the virtual meeting portal. Please note that we will attempt to answer as many questions as time allows.
Thank you. Our first question: What is the potential range of impact that you can see from tariffs, including pharma-specific tariffs, having on Gilead 's operations and for the biopharma industry as a whole?
Hi, this is Andy Dickinson. Thank you for the question. The known tariffs that have been enacted to date may increase some of our indirect costs, but we expect them to be manageable in 2025, in part due to our strong operating expense discipline that Dan just highlighted. We are also seeing lighter foreign exchange headwinds this year than we had previously forecast. As discussed in our recent first quarter earnings, our updated guidance for the year does reflect the expected impact of the increase in indirect costs that we've seen from both announced tariffs and reciprocal tariffs. With regards to any sector-specific tariffs relating to the pharmaceutical industry, which have not been enacted to date, until we have further clarity on what's been implemented, if anything, how it's implemented, and what actions others may take, we are unable to comment on hypothetical scenarios and impacts.
I can say, however, that we believe that we are very well positioned to adapt to a range of potential policy outcomes and that we will continue to monitor the situation closely and adjust as new developments arise.
Thank you. Is Gilead using AI to drive innovation and improve business execution?
Hi, it's Andy Dickinson again. Thank you for this question. Yes, Gilead is using AI, and specifically, we are using AI to promote end-to-end productivity across our business, to drive efficiencies, improve our customer engagement, accelerate development timelines for our therapeutics, and improve patient and customer experiences. A couple of examples that we can highlight: we recently entered into strategic collaborations with Genesis Therapeutics to utilize their field-leading AI platform, which is called GEMS, to assist in generating and optimizing molecules for select targets. I'd also highlight our collaboration with Terray Therapeutics, which allows us to utilize its next-generation AI-driven platform to discover and develop small molecule therapies against multiple targets. These are just a few examples of how Gilead is using AI to enhance innovation across the company, and we will continue to assess where AI can catalyze innovation across our therapeutic areas and help streamline our business.
Thank you. Our next question: Will the approval process for drugs change during the Trump administration, and in what way?
Hi, this is Dietmar Berger. There have been no changes to FDA's approval process announced at this time, and as we noted on our first quarter earnings call, we continue to have encouraging and timely interactions with FDA for lenacapavir for HIV prevention.
Thank you. With the elimination of PEPFAR and other government programs, how will Gilead ensure access to its medications globally, including potentially lenacapavir for PrEP?
Yeah, this is Dan O'Day, so let me start. First of all, I just want to emphasize the importance of access for lenacapavir throughout the world. In fact, Gilead has been leading in this from the very moment that we got the PURPOSE 1 and PURPOSE 2 results this past summer with establishing voluntary licensing programs immediately and beginning the tech transfer to generic manufacturers to supply the medicines. We also announced in December an intent to collaborate with both PEPFAR and the Global Fund on distribution of medicine at no profit to Gilead in the interim between approval and whether generic manufacturers have sufficient supply to coordinate with the supply for the developing world, and this is to more than 120 low and middle-income countries.
We are not able to enter into an official agreement with PEPFAR or the Global Fund until after the approval, which we anticipate, as you know, the PDUFA date is in June. We continue to work towards that end, and that means at this stage, and of course, continue to support the importance of lenacapavir in the developing world. Let me see, is there any addition?
Sure. Just maybe to add to what Dan was saying, Johanna Mercier here, and specifically around HIV funding, we do a lot at Gilead to ensure screening, diagnosis happens, as well as linkage to care, as does the government. Specific to that, we are working diligently with the government, with the current administration, to ensure that we educate, raise awareness around the importance of these funds to continue within the states and in foreign countries as well, in light of the fact that viruses know no borders.
Chairman, that concludes our session for questions and comments. Stockholders are reminded that they may contact the company's Investor Relations team with questions and comments after the conclusion of this meeting. Please see the Rules of Conduct and procedures posted on the virtual meeting portal for additional information.
On behalf of our Board of Directors and management team, I want to thank all of our shareholders for joining us for today's annual meeting and for your investment in Gilead . We value your support as we continue to work on your behalf to help improve global health and generate value for all of our stakeholders.
This concludes the Gilead Sciences Inc annual meeting of stockholders. Thank you very much.