What changed in this filing

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Item 1. Business

2021-02-25 compared with 2020-02-25 · 206 added, 150 removed, 225 unchanged (61% of the section changed)

Gilead Sciences, Inc.

(Gilead, we, our or us), incorporated in Delaware on June 22, 1987, is a research-based biopharmaceutical company that discovers, develops and commercializes innovative medicines in areas of unmet medical need.

With each new discovery and investigational drug candidate, we strive to transform and simplify care for people with life-threatening illnesses around the world.

We have operations in more than 35 countries worldwide, with headquarters in Foster City, California.

Gilead’s primary areas of focus include viral diseases, inflammatory and fibrotic diseases and oncology .

We seek to add to our existing portfolio of products through our internal discovery and clinical development programs, product acquisition, in-licensing and strategic collaborations.

Our Principal Products

Our innovative medicines represent advancements by offering enhanced modes of delivery, more convenient treatment regimens, improved resistance profiles, reduced side effects and greater efficacy.

Our focus on innovation has allowed us to deliver more than 24 marketed products across multiple therapeutic areas.

Our principal products and the approved indications in the United States are as follows:

(“Gilead”, “we”, “our” or “us”) is a biopharmaceutical company that has pursued and achieved breakthroughs in medicine for more than three decades, with the goal of creating a healthier world for all people.

We are committed to advancing innovative medicines to prevent and treat life-threatening diseases, including HIV, viral hepatitis and cancer.

We operate in more than 35 countries worldwide, with headquarters in Foster City, California.

Our innovative medicines represent advancements by offering first-in-class treatments, greater efficacy, enhanced modes of delivery, more convenient treatment regimens, improved resistance profiles and reduced side effects.

Our focus on innovation has allowed us to deliver marketed products across multiple therapeutic areas.

In 2020, our primary revenue-generating products and the approved indications in the United States are as follows:

• Biktarvy ® is an oral formulation dosed once a day for the treatment of HIV-1 infection in certain patients.

Biktarvy is a single tablet regimen of a fixed-dose combination of our antiretroviral medications, bictegravir, emtricitabine and tenofovir alafenamide (“TAF”).

• Genvoya ® is an oral formulation dosed once a day for the treatment of HIV-1 infection in certain patients.

Genvoya is a single tablet regimen of a fixed-dose combination of our antiretroviral medicines, elvitegravir, cobicistat, emtricitabine and TAF.

• Descovy ® is an oral formulation indicated in combination with other antiretroviral agents for the treatment of HIV-1 infection in certain patients.

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• Odefsey ® is an oral formulation dosed once a day for the treatment of HIV-1 infection in certain patients.

Odefsey is a single tablet regimen of a fixed-dose combination of our antiretroviral medications, emtricitabine and TAF, and rilpivirine marketed by Janssen Sciences Ireland UC, one of the Janssen Pharmaceutical Companies of Johnson & Johnson (Janssen).

Genvoya ® is an oral formulation dosed once a day for the treatment of HIV-1 infection in certain patients.

Genvoya is a single tablet regimen of a fixed-dose combination of our antiretroviral medicines, elvitegravir, cobicistat, emtricitabine and TAF.

Stribild ® is an oral formulation dosed once a day for the treatment of HIV-1 infection in certain patients.

Stribild is a single tablet regimen of a fixed-dose combination of our antiretroviral medications, elvitegravir, cobicistat, tenofovir disoproxil fumarate (TDF) and emtricitabine.

Odefsey is a single tablet regimen of a fixed-dose combination of our antiretroviral medications, emtricitabine and TAF, and rilpivirine marketed by Janssen Sciences Ireland Unlimited Company, one of the Janssen Pharmaceutical Companies of Johnson & Johnson (“Janssen”).

• Truvada ® is an oral formulation indicated in combination with other antiretroviral agents for the treatment of HIV-1 infection in certain patients.

It is a fixed-dose combination of our antiretroviral medications, TDF and emtricitabine.

Truvada is also approved by FDA for a PrEP indication to reduce the risk of sexually acquired HIV-1 infection in certain at-risk patients.

• Complera ® /Eviplera ® is an oral formulation dosed once a day for the treatment of HIV-1 infection in certain patients.

The product, marketed in the United States as Complera and in Europe as Eviplera, is a single tablet regimen of a fixed-dose combination of our antiretroviral medications, TDF and emtricitabine, and Janssen’s rilpivirine hydrochloride.

The product, marketed in the United States as Complera and in Europe as Eviplera, is a single tablet regimen of a fixed-dose combination of our antiretroviral medications, tenofovir disoproxil fumarate (“TDF”) and emtricitabine, and Janssen’s rilpivirine hydrochloride.

• Stribild ® is an oral formulation dosed once a day for the treatment of HIV-1 infection in certain patients.

Stribild is a single tablet regimen of a fixed-dose combination of our antiretroviral medications, elvitegravir, cobicistat, TDF and emtricitabine.

• Atripla ® is an oral formulation indicated as a complete regimen for the treatment of HIV-1 infection in certain patients.

Atripla is a fixed-dose combination of our antiretroviral medications, TDF and emtricitabine, and Bristol-Myers Squibb Company (“BMS”)’s efavirenz.

Truvada ® is an oral formulation indicated in combination with other antiretroviral agents for the treatment of HIV-1 infection in certain patients.

It is a fixed-dose combination of our antiretroviral medications, TDF and emtricitabine.

Truvada is also approved by FDA for a PrEP indication, in combination with safer sex practices, to reduce the risk of sexually acquired HIV-1 infection in certain at-risk patients.

• Veklury ® (remdesivir), an injection for intravenous use, is a nucleotide analog RNA polymerase inhibitor indicated for certain patients for the treatment of coronavirus disease 2019 (“COVID-19”) requiring hospitalization.

Liver Diseases

Vosevi ® is an oral formulation of a once-daily, single tablet regimen of sofosbuvir, velpatasvir and voxilaprevir for the re-treatment of chronic hepatitis C virus (HCV) infection in adults:

(i) with genotype 1, 2, 3, 4, 5 or 6 previously treated with an NS5A inhibitor-containing regimen or (ii) with genotype 1a or 3 previously treated with a sofosbuvir-containing regimen without an NS5A inhibitor.

Epclusa ® is an oral formulation of a once-daily single tablet regimen of sofosbuvir and velpatasvir for the treatment of chronic HCV infection in adults with genotype 1, 2, 3, 4, 5 or 6:

• Epclusa ® is an oral formulation of a once-daily single tablet regimen of sofosbuvir and velpatasvir for the treatment of chronic hepatitis C virus (“HCV”) infection in adults and certain pediatric patients with genotype 1, 2, 3, 4, 5 or 6:

(i) without cirrhosis or with compensated cirrhosis or (ii) with decompensated cirrhosis for use in combination with ribavirin.

In addition, we have an authorized generic version of Epclusa distributed by our separate subsidiary, Asegua Therapeutics LLC.

• Harvoni ® is an oral formulation of a once-daily, single tablet regimen of ledipasvir and sofosbuvir for the treatment of chronic HCV infection in:

who are liver transplant recipients without cirrhosis or with compensated cirrhosis, in combination with ribavirin, or (iv) certain pediatric patients with genotype 1, 4, 5 or 6 without cirrhosis or with compensated cirrhosis.

(i) adults with genotype 1, 4, 5 or 6 without cirrhosis or with compensated cirrhosis, (ii) adults with genotype 1 infection with decompensated cirrhosis, in combination with ribavirin, (iii) adults with genotype 1 or 4 who are liver transplant recipients without cirrhosis or with compensated cirrhosis, in combination with ribavirin, or (iv) certain pediatric patients with genotype 1, 4, 5 or 6 without cirrhosis or with compensated cirrhosis.

In addition, we have an authorized generic version of Harvoni distributed by our separate subsidiary, Asegua Therapeutics LLC.

• Vosevi ® is an oral formulation of a once-daily, single tablet regimen of sofosbuvir, velpatasvir and voxilaprevir for the re-treatment of chronic HCV infection in adults:

• Vemlidy ® is an oral formulation of TAF dosed once a day for the treatment of chronic hepatitis B virus (“HBV”) infection in adults with compensated liver disease.

• Viread ® is an oral formulation of TDF dosed once a day for the treatment of chronic HBV infection in adults and certain pediatric patients.

Hematology/Oncology

Yescarta ® (axicabtagene ciloleucel) is a chimeric antigen receptor (CAR) T cell therapy for the treatment of adult patients with relapsed or refractory large B-cell lymphoma after two or more lines of systemic therapy, including diffuse large B-cell lymphoma (DLBCL) not otherwise specified, primary mediastinal large B-cell lymphoma, high-grade B-cell lymphoma and DLBCL arising from follicular lymphoma.

Hematology/Oncology/Cell Therapy

• Yescarta ® (axicabtagene ciloleucel), a suspension for intravenous infusion, is a chimeric antigen receptor (“CAR”) T cell therapy for the treatment of adult patients with relapsed or refractory large B-cell lymphoma after two or more lines of systemic therapy, including diffuse large B-cell lymphoma (“DLBCL”) not otherwise specified, primary mediastinal large B-cell lymphoma, high-grade B-cell lymphoma and DLBCL arising from follicular lymphoma.

• Tecartus ™ (brexucabtagene autoleucel), a suspension for intravenous infusion, is a CAR T cell therapy for the treatment of adult patients with relapsed or refractory mantle cell lymphoma.

• Trodelvy ® (sacituzumab govitecan-hziy), an injection for intravenous use, is a Trop-2 directed antibody and topoisomerase inhibitor conjugate indicated for the treatment of adult patients with metastatic triple-negative breast cancer who have received at least two prior therapies for metastatic disease.

This indication is approved under accelerated approval by FDA, and continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials.

• Zydelig ® (idelalisib) is an oral formulation of a kinase inhibitor for the treatment of patients with:

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• AmBisome ® (amphotericin B liposome for injection) is a proprietary liposomal formulation of amphotericin B, an antifungal agent, for the treatment of serious invasive fungal infections caused by various fungal species in adults.

For information about our product revenues, including the amount of revenue contributed by each of the products listed above for each of the last three fiscal years, see Note 2 .

For information about our revenue-generating products, including the amount of revenue contributed by the products listed above, see Note 2.

Revenues of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K .

Revenue Share and Other Revenues

We also generate revenues from other activities, including revenue share from combination products, royalties for outbound licenses of our intellectual property and other payments received from our collaborations with third-party partners.

For example, pursuant to our collaboration with Janssen, we receive revenue share from cobicistat, emtricitabine and TAF that are components of Symtuza (darunavir/cobicistat/emtricitabine/TAF), a fixed-dose combination product commercialized by Janssen.

We include our revenue share from Symtuza in our Product sales.

For a description of our collaborations with Janssen and other partners, see Note 11.

Collaborations and Other Arrangements of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K .

Commercialization and Distribution

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We sell and distribute most of our products in the United States exclusively through the wholesale channel.

Our product sales to three large wholesalers, AmerisourceBergen Corporation, Cardinal Health, Inc.

and McKesson Corporation, each accounted for more than 10% of total revenues for each of the years ended December 31, 2019 , 2018 and 2017 .

On a combined basis, in 2019 , these wholesalers accounted for approximately 87% of our product sales in the United States and approximately 64% of our total worldwide revenues.

During the twelve months ended December 31, 2020, approximately 92% of our product sales in the United States and approximately 68% of our total worldwide revenues were to three large wholesalers, AmerisourceBergen Corporation, Cardinal Health, Inc.

and McKesson Corporation.

We sell and distribute our products in Europe and countries outside the United States where the product is approved, either through our commercial teams, third-party distributors or corporate partners.

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Further, as new branded or generic products are introduced into major markets, our ability to maintain pricing and market share may be affected.

For a description of our competitors, see Item 1A.

Risk Factors “We face significant competition.”

Research and Development

Our research and development (R&D) philosophy and strategy are to develop best-in-class drugs that improve safety or efficacy for unmet medical needs.

We intend to continue committing significant resources to internal R&D opportunities and external business development activity.

Our product development efforts are focused primarily in viral diseases, inflammatory and fibrotic diseases and oncology.

We have research scientists engaged in the discovery and development of new molecules and technologies that we hope will lead to the approval of new medicines that will advance the current standard of care and address unmet medical needs.

The development of our product candidates is subject to various risks and uncertainties.

Our research and development (“R&D”) mission is to discover and develop transformational therapies in areas of high unmet medical need.

Our product development efforts are focused primarily in viral diseases, inflammatory diseases and oncology.

Our team of research scientists is engaged in the discovery and development of new molecules and technologies that we hope will lead to the approval of innovative medicines and therapies that will advance the current standard of care and address unmet medical needs.

We intend to continue committing significant resources to internal R&D opportunities and external business development activity to drive innovation and growth of our business.

The development of product candidates and investigational therapies in our pipeline is subject to various risks and uncertainties.

These risks and uncertainties include our ability to enroll patients in clinical trials, the possibility of unfavorable results of our clinical trials, the need to modify or delay our clinical trials or to perform additional trials and the risk of failing to obtain regulatory approvals.

As a result, our product candidates may never be successfully commercialized.

Drug development is inherently risky and many product candidates fail during the drug development process.

As a result, our product candidates and investigational therapies may never be successfully commercialized.

Drug development is inherently risky, and many product candidates and investigational therapies fail during the development process.

In 2020, we continued to invest in and advance our R&D pipeline across our therapeutic areas.

At the end of 2019, our R&D pipeline included 104 active clinical studies, of which 27 were Phase 3 clinical trials.

Below is a summary of our key product candidates and their corresponding current stages of development.

Below is a summary of our product candidates that are in Phase 3 or registrational Phase 2 clinical trials or are pending marketing authorization review by FDA or European Medicines Agency (“EMA”).

Product Candidates in Viral Diseases

Product Candidates

GS-6207, a capsid inhibitor, is being evaluated for the treatment of HIV infection.

Selgantolimod

Selgantolimod, a TLR-8 agonist, is being evaluated for the treatment of chronic HBV infection.

Vesatolimod, a TLR-7 agonist, is being evaluated as a potential cure for HIV infection.

Elipovimab, a broadly neutralizing antibody, is being evaluated as a potential cure for HIV infection.

GS-4224, a PD-L1 inhibitor, is being evaluated for the treatment of chronic HBV infection.

Product Candidates in Inflammatory and Fibrotic Diseases

Phase 3 or Phase 2/3

Remdesivir (injection)

Remdesivir for injection is being evaluated for the outpatient treatment of COVID-19 (expanded indication).

Lenacapavir, an HIV capsid inhibitor, is being evaluated as a component of a long-acting regimen for the treatment of HIV infection in heavily treatment-experienced people living with HIV.

It has been granted Breakthrough Therapy designation by FDA for this indication.

Bulevirtide (1)

Bulevirtide is being evaluated for the treatment of chronic hepatitis delta virus (“HDV”) infection.

It has been granted both Orphan Drug and Breakthrough Therapy designations by FDA for chronic HDV infection.

It has also been granted Breakthrough Therapy designation and PRIority MEdicines (“PRIME”) scheme eligibility by the European Commission for chronic HDV infection.

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(1) In December 2020, we entered into a definitive agreement to acquire MYR GmbH.

Upon closing, which is subject to regulatory clearances and other conditions, the acquisition will provide us with Hepcludex ® (bulevirtide), which was conditionally approved by the European Commission for the treatment for chronic HDV infection in July 2020.

Product Candidates in Inflammatory Diseases

Product Candidates

Filgotinib, a JAK1 inhibitor, is being evaluated for the treatment of (i) Crohn’s disease, (ii) ulcerative colitis and (iii) psoriatic arthritis.

Cilofexor, a FXR agonist, is being evaluated for the treatment of primary sclerosing cholangitis.

GLPG-1690 (2)

GLPG-1690, an autotaxin inhibitor, is being evaluated for the treatment of idiopathic pulmonary fibrosis.

Filgotinib is being evaluated for the treatment of (i) ankylosing spondylitis and (ii) uveitis.

GS-4875, a TPL2 inhibitor, is being evaluated for the treatment of ulcerative colitis.

GLPG-1972 (1)

GLPG-1972, an ADAMTS-5 inhibitor, is being evaluated for the treatment of osteoarthritis.

Selonsertib, an ASK-1 inhibitor, is being evaluated for the treatment of diabetic kidney disease.

Cilofexor, firsocostat and selonsertib combinations

Cilofexor, firsocostat (an ACC inhibitor) and selonsertib combinations are being evaluated for the treatment of nonalcoholic steatohepatitis (NASH).

GLPG-1690 (2)

GLPG-1690 is being evaluated for the treatment of systemic sclerosis.

GLPG-1205 (1)

GLPG-1205, a GPR84 inhibitor, is being evaluated for the treatment of idiopathic pulmonary fibrosis.

GLPG-0555 (1)

GLPG-0555 is being evaluated for the treatment of inflammatory diseases.

GLPG-3312 (1)

GLPG-3312 is being evaluated for the treatment of inflammatory diseases.

GLPG-3970 (1)

GLPG-3970 is being evaluated for the treatment of inflammatory diseases.

GLPG-3667 (1)

GLPG-3667 is being evaluated for the treatment of inflammatory diseases.

Regulatory Filing

A marketing authorization application has been filed with EMA for filgotinib, a JAK1 inhibitor, for the treatment of ulcerative colitis.

Filgotinib is being evaluated for the treatment of Crohn’s disease.

Cilofexor, an FXR agonist, is being evaluated for the treatment of primary sclerosing cholangitis.

Product Candidates in Oncology

Product Candidates

Axicabtagene ciloleucel

Axicabtagene ciloleucel is being evaluated for the treatment of second line DLBCL.

Regulatory Filing

Axicabtagene ciloleucel

Axicabtagene ciloleucel is being evaluated for the treatment of indolent non-Hodgkin lymphoma.

Axicabtagene ciloleucel is also being evaluated for the treatment of (i) first line DLBCL and (ii) DLBCL in combination with either rituximab or lenalidomide.

KTE-X19, a CAR T cell therapy, is being evaluated for the treatment of (i) adult and pediatric acute lymphoblastic leukemia and (ii) CLL.

A supplemental Biologics License Application for axicabtagene ciloleucel, a CAR T cell therapy for the treatment of relapsed or refractory indolent non-Hodgkin’s lymphoma (“iNHL”), has been filed with FDA.

It has been granted Breakthrough Therapy designation by FDA for the iNHL indication.

Brexucabtagene autoleucel

Brexucabtagene autoleucel, a CAR T cell therapy, has received accelerated approval from FDA and conditional marketing authorization from the European Commission for the treatment of adult patients with relapsed or refractory mantle cell lymphoma after two or more lines of systemic therapy, including a Bruton’s tyrosine kinase inhibitor.

Conditional marketing authorization in Europe is initially valid for one year but can be extended or converted into an unconditional authorization after the submission and assessment of additional confirmatory data.

Sacituzumab govitecan-hziy

A supplemental Biologics License Application for full approval of sacituzumab govitecan-hziy, a Trop-2 directed antibody and topoisomerase inhibitor conjugate for the treatment of patients with metastatic triple-negative breast cancer (“mTNBC”) who have received at least two prior therapies, has been filed with FDA.

It has been granted Breakthrough Therapy designation by FDA for the mTNBC indication.

Sacituzumab govitecan-hziy

A supplemental Biologics License Application for accelerated approval of sacituzumab govitecan-hziy for the treatment of heavily-pretreated patients with metastatic urothelial cancer, has been filed with FDA.

Axicabtagene ciloleucel

Axicabtagene ciloleucel is being evaluated for the treatment of DLBCL in combination with utomilumab.

KITE-718, a MAGE A3/A6, is being evaluated for the treatment of solid tumors.

KITE-439, an HPV E7, is being evaluated for the treatment of solid tumors.

GS-1423, a bi-specific antibody, is being evaluated for the treatment of solid tumors.

GS-4224, an oral PD-L1 inhibitor, is being evaluated for the treatment of solid tumors.

AGEN1223, a bi-specific mAb, is being evaluated for the treatment of multiple indications in oncology.

AGEN2373, an anti-CD137 mAb, is being evaluated for the treatment of multiple indications in oncology.

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Optionable partner program

Optioned partner program

In addition to our internal discovery and clinical development programs, we seek to add to our portfolio of products through product acquisition, in-licensing and strategic collaborations.

In 2019, we completed 27 strategic partnerships, licensing deals and equity investments, which reflects our commitment to developing our pipeline across a range of diseases to address areas of significant unmet medical need and positioning ourselves for the long-term growth of our business.

Axicabtagene ciloleucel is being evaluated for the treatment of second line diffuse large B cell lymphoma.

Magrolimab, an anti-CD47, is being evaluated for the treatment of myelodysplastic syndrome (“MDS”).

It has been granted Breakthrough Therapy designation by FDA and PRIME scheme eligibility by the European Commission for the MDS indication.

Sacituzumab govitecan-hziy

Sacituzumab govitecan-hziy is being evaluated for the treatment of hormone receptor positive (“HR+”), human epidermal growth factor receptor 2 negative (“HER2-”), metastatic breast cancer patients who have failed at least two prior chemotherapy regimens.

Registrational Phase 2

Brexucabtagene autoleucel

Brexucabtagene autoleucel, a CAR T cell therapy, is being evaluated for the treatment of adult acute lymphoblastic leukemia (“ALL”).

It has been granted Breakthrough Therapy designation by FDA for the adult ALL indication.

Brexucabtagene autoleucel

Brexucabtagene autoleucel, a CAR T cell therapy, is being evaluated for the treatment of pediatric ALL.

It has been granted Breakthrough Therapy designation by FDA for the pediatric ALL indication.

Magrolimab is being evaluated for the treatment of diffuse large B cell lymphoma.

We also seek to add to our portfolio of products and product candidates through acquisitions, in-licensing and strategic collaborations.

In 2020, we entered into 18 strategic partnerships and acquisitions to enhance our commercial portfolio and clinical pipeline across multiple therapeutic areas.

For example, the acquisition of Immunomedics, Inc.

(“Immunomedics”) added Trodelvy and other pipeline programs to our oncology portfolio.

Our strategic business development activity reflects our commitment to focus on transformative science, build a sustainable and diverse portfolio and position ourselves for the near, medium and long-term growth of our business.

Patents and Proprietary Rights

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and foreign patents, patent applications and rights to patents related to our compounds, products and technology, but we cannot be certain that issued patents will be enforceable or provide adequate protection or that pending patent applications will result in issued patents.

The following table shows the estimated expiration dates (including patent term extensions, supplementary protection certificates and/or pediatric exclusivity where granted) in the United States and the European Union for the primary (typically compound) patents for our Phase 3 product candidates.

For our product candidates that are fixed-dose combinations of single tablet regimens, the estimated patent expiration date provided corresponds to the latest expiring compound patent for one of the active ingredients in the single tablet regimen.

Phase 3 Product Candidates

Key Product Candidates

Patent Expiration

Product Candidates in Inflammatory and Fibrotic Diseases:

Filgotinib for the treatment of rheumatoid arthritis, Crohn’s disease, ulcerative colitis and psoriatic arthritis

GLPG-1690 for the treatment of idiopathic pulmonary fibrosis

Cilofexor for the treatment of primary sclerosing cholangitis

Product Candidate in Oncology:

Axicabtagene ciloleucel for the treatment of second line DLBCL

Viral Diseases:

Bulevirtide (1)

Inflammatory Diseases:

Axicabtagene ciloleucel

Brexucabtagene autoleucel

Sacituzumab govitecan-hziy

Magrolimab 2031 2031

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(1) In December 2020, we entered into a definitive agreement to acquire MYR GmbH.

Upon closing, which is subject to regulatory clearances and other conditions, the acquisition will provide us with bulevirtide.

(2) The composition of matter patent has expired in the European Union.

In the European Union and the United States, patent applications are pending relating to proprietary manufacturing processes of Kite, a Gilead company.

In the European Union and the United States, patent applications are pending relating to proprietary manufacturing processes of Kite, a Gilead company (“Kite”).

(3) An application for patent term extension was filed in the United States that, if granted, would extend the U.S.

expiration date to at least 2028.

Regulatory exclusivity in the United States expires in 2032.

The following table shows the actual or estimated expiration dates (including patent term extensions, supplementary protection certificates and/or pediatric exclusivity where granted) in the United States and the European Union for the primary (typically compound) patents for our principal products.

For our products that are fixed-dose combinations or single tablet regimens,

the estimated patent expiration dates provided correspond to the latest expiring compound patent for one of the active ingredients in the single tablet regimen.

For our products that are fixed-dose combinations or single tablet regimens, the estimated patent expiration dates provided correspond to the latest expiring compound patent for one of the active ingredients in the single tablet regimen.

Patent Expiration

Complera/Eviplera

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Hepcludex (8)

These estimated expiration dates do not include any potential additional exclusivity (e.g., patent term extensions, supplementary protection certificates or pediatric exclusivity) that has not yet been granted.

__________________________________________

In 2017, Gilead and Watson Laboratories, Inc.

reached an agreement to settle a patent litigation matter related to Letairis.

(1) In 2013, Gilead and Lupin Limited reached an agreement to settle a patent litigation matter related to Ranexa.

In 2014, Gilead and Teva Pharmaceuticals reached an agreement to settle the patent litigation concerning patents that protect emtricitabine in our Truvada and Atripla products.

For additional information, see Item 1A.

Risk Factors “We face significant competition.”

Supplementary protection certificates (SPCs) have been granted in several European countries.

(2) In 2014, Gilead and Teva Pharmaceuticals (“Teva”) reached an agreement to settle the patent litigation concerning patents that protect emtricitabine in our Truvada and Atripla products, pursuant to which Teva was permitted to launch generic fixed-dose combinations of emtricitabine and TDF and generic fixed-dose combinations of emtricitabine, TDF and efavirenz in the United States on September 30, 2020.

(3) Supplementary protection certificates (“SPC”s) have been granted in several European countries.

The validity of these SPCs has been challenged by several generic manufacturers, many of whom launched their competing products in 2017.

An application for patent term extension was filed in the United States that, if granted, would extend the U.S.

expiration date to at least 2025.

(4) Applications for patent term extensions are pending in the United States and/or SPCs are pending in one or more countries in the European Union for these products.

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In the European Union and the United States, patent applications are pending relating to proprietary manufacturing processes of Kite.

(6) In 2018, Gilead and Mylan Pharmaceuticals reached an agreement to settle the patent litigation concerning patents that protect cobicistat in our Stribild and Genvoya products.

(7) An application for patent term extension was filed in the United States that, if granted, would extend the U.S.

expiration date to at least 2028.

Regulatory exclusivity in the United States expires in 2032.

(8) In December 2020, we entered into a definitive agreement to acquire MYR GmbH.

Bulevirtide has not been approved by FDA for any use, and its safety and efficacy have not been established.

Patent Protection and Certain Challenges

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As part of our business strategy, we actively seek patent protection both in the United States and internationally and file additional patent applications, when appropriate, to cover improvements in our compounds, products and technology.

Patents covering certain of the active pharmaceutical ingredients (API) of most of our HIV products as well as Yescarta are held by third parties.

Patents covering certain of the active pharmaceutical ingredients (“API”) of most of our HIV products as well as cell therapy products are held by third parties.

We acquired exclusive rights to these patents in the agreements we have with these parties.

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If we fail to obtain these licenses or alternative technologies, we may be unable to develop or commercialize some or all of our products.

For example, we are aware of patents and patent

applications owned by other parties that such parties may claim to cover the use of sofosbuvir, axicabtagene ciloleucel and bictegravir.

For example, we are aware of patents and patent applications owned by other parties that such parties may claim to cover the use of sofosbuvir, axicabtagene ciloleucel, brexucabtagene autoleucel, tenofovir disoproxil, tenofovir alafenamide and bictegravir.

Because patent applications are confidential for a period of time until a patent is issued, we may not know if our competitors have filed patent applications for technology covered by our pending applications or if we were the first to invent or first to file an application directed toward the technology that is the subject of our patent applications.

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For a description of our significant pending legal proceedings, see Note 14.

Commitments and Contingencies - Legal Proceedings of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K .

Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

See also Item 1A.

Risk Factors “Our success depends to a significant degree on our ability to obtain and defend our patents and other intellectual property rights both domestically and internationally, and to operate without infringing upon the patents or other proprietary rights of third parties.”

Trade Secrets

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For most of our products, including our HIV and HCV products, we use multiple third-party contract manufacturers so that we have primary and back-up suppliers and manufacturing sites.

For Yescarta, we have established clinical and commercial manufacturing facilities for cell processing activities.

For our cell therapy products, we have established clinical and commercial manufacturing facilities for cell processing activities.

For our future products, we continue to develop additional manufacturing capabilities and establish additional third-party suppliers to manufacture sufficient quantities of our product candidates to undertake clinical trials and to manufacture sufficient quantities of any product that is approved for commercial sale.

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These facilities are located in Foster City, San Dimas, La Verne, Oceanside and El Segundo, California;

Morris Plains, New Jersey;

Dublin and Cork, Ireland;

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• El Segundo, California:

We utilize the facility for clinical and commercial manufacturing and processing of Yescarta.

We utilize the facility for clinical and commercial manufacturing and processing of our cell therapy products.

• Morris Plains, New Jersey:

We utilize the facility for commercial manufacturing and process optimization of our antibody drug conjugate products.

• Cork and Dublin, Ireland:

We utilize the Cork facility for commercial manufacturing, packaging and labeling of our products.

We also perform quality control testing, labeling, packaging and final release of many of our products for distribution to the European Union and other international markets.

The Dublin facility is also responsible for distribution activities for our products.

We also perform quality control testing, labeling, packaging and final release of many of our products at the Cork facility, which are distributed to the European Union and other international markets through our facility in Dublin.

We utilize our other facility in central Dublin as a drug development hub for our pediatric programs where we perform clinical development, safety, quality, biostatistics and data sciences, regulatory and compliance functions.

• Edmonton, Canada:

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• Hoofddorp, Netherlands:

We utilize the facility for commercial manufacturing and processing of Yescarta.

We utilize the facility for commercial manufacturing and processing of our cell therapy products.

Third-Party Manufacturers

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For more information about our third-party manufacturers, see Item 1A.

Risk Factors “Manufacturing problems, including at our third-party manufacturers and corporate partners, could cause inventory shortages and delay product shipments and regulatory approvals, which may adversely affect our results of operations.”

Risk Factors “We may face manufacturing difficulties, delays or interruptions, including at our third-party manufacturers and corporate partners.”

Regulation of Manufacturing Process

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Our manufacturing operations are subject to routine inspections by regulatory agencies.

For Yescarta, we are required by FDA to comply with the Risk Evaluation and Mitigation Strategy program, which includes educating and certifying medical personnel regarding the therapy procedures and the potential side effect profile of our therapy, such as the potential adverse side effects related to cytokine release syndrome and neurologic toxicities.

For our cell therapy products, we are required by FDA to comply with the Risk Evaluation and Mitigation Strategy program, which includes educating and certifying medical personnel regarding the therapy procedures and the potential side effect profile of our therapy, such as the potential adverse side effects related to cytokine release syndrome and neurologic toxicities.

Additionally, we are required to maintain a complex chain of identity and custody with respect to patient material as such material moves to the manufacturing facilities, through the manufacturing process, and back to the patient.

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Risk Factors “We may not be able to obtain materials or supplies necessary to conduct clinical trials or to manufacture and sell our products, which could limit our ability to generate revenues.”

Seasonality of Operations and Backlog

Human Capital

Gilead’s success depends on the work of its dedicated employees who embrace a shared sense of purpose and a culture of excellence.

Our human capital objective is to make Gilead the employer of choice for the best talent in our industry.

Gilead’s key priorities for human capital management include inclusion and diversity, health and safety, total rewards, employee development and engagement.

Our Board’s Compensation and Talent Committee oversees our overall human capital management.

Inclusion & Diversity

Inclusion is a Gilead core value.

We are committed to advancing inclusion and diversity (“I&D”) in our workforce and have established a Global Diversity Council responsible for governance of these matters, tracking progress on our goals and promoting a culture of inclusion.

The Global Diversity Council is chaired by our Chairman and Chief Executive Officer.

In 2020, Gilead implemented multiple programs to train managers on I&D topics to build awareness and drive inclusive behaviors.

Our employee resource groups (“ERGs”) support diverse employees and aim to raise awareness of different cultures within the workplace, cultivate diversity as a business strength and support Gilead’s talent acquisition strategy to source, attract and recruit diverse candidates.

We believe Gilead’s inclusive and diverse workforce is the foundation for innovation and productivity.

Gilead’s commitment to equal employment opportunity furthers its efforts to cultivate and celebrate an equitable culture of belonging.

At December 31, 2020, Gilead had approximately 13,600 employees, and Gilead’s global workforce was approximately 52% female and 48% male.

Additionally, women represented 34% of Gilead’s leadership (defined as vice president level and above).

In the U.S., based on our employees’ voluntary self-identification, our workforce was 41% White, 38% Asian, 11% Hispanic, 6% Black and 4% Other.

Health and Safety

Gilead is committed to providing a safe, healthy and secure workplace for its employees.

We have an environmental health and safety policy and maintain various compliance programs to support this commitment.

We routinely train and educate our employees on workplace safety and security.

During 2020, due to the COVID-19 pandemic, most Gilead sites required flexible location employees to work from home, while employees who needed to be physically present for their positions (such as laboratory technicians) continued to work at Gilead sites.

We implemented site enhancements and risk protocols, including health screenings, COVID-19 testing, reconfiguration of work and common spaces to allow for social distancing, in our effort to support the safe occupancy of our sites.

Gilead also maintains a robust contact tracing and notification process for any employee who reports COVID-19 infection.

To date, we have not identified any cases of viral transmission of COVID-19 in our workplace.

Total Rewards

Gilead’s compensation and benefits programs are designed to help attract, cultivate and retain the industry’s most talented workforce.

Our Total Rewards program (which varies by country) includes competitive base salary and incentive compensation, stock awards, an employee stock purchase plan, a 401(k) savings plan with a company match that vests immediately, health and welfare and other valuable benefits, such as flexible spending accounts, paid time off, family leave, family care resources, adoption and surrogacy assistance, employee assistance programs, global wellness reimbursement and tuition assistance, among many others.

Each year, we reassess our Total Rewards package to confirm whether it offers benefits and incentives that align with our total reward philosophy.

In 2020, in response to the COVID-19 pandemic, we implemented a number of temporary COVID-19-specific benefits, such as cost reimbursements for essential home office equipment, monthly reimbursements for childcare and home-schooling costs, and a special pay enhancement for our physical location dependent workers who are required to be onsite at Gilead due to the nature of their role, to support our workforce during the unique challenges presented by the pandemic.

We are committed to address pay equity.

Our employee salaries are informed by market-based ranges and are assessed annually through performance and career development reviews.

Our policy is that compensation decisions are made without regard to personal characteristics such as gender, race, color, national or ethnic origin, age, disability, sexual orientation, gender identity or expression, genetic information, religion, or veteran status.

We also conduct an annual pay equity review of employee compensation in an effort to strive to make our pay practices gender and race neutral.

Employee Development and Engagement

Gilead offers a number of professional, management and leadership development training programs to help our employees develop cross-functional skills and tools to grow their careers.

In addition, employees can receive reimbursement for tuition expenses incurred while pursuing undergraduate, graduate or certificate courses at an accredited college or university.

As we make changes to pursue our ambition of becoming an employer of choice in our industry, it is important that we consider the input of employees.

Our listening strategy helps to gather employee input and measure our progress.

During 2020, we conducted several global surveys to assess and improve employee retention and engagement, gather feedback and take actions to address areas of employee concern.

Employee responses from these surveys were key to determining meaningful benefits related to the COVID-19 pandemic as well as the direction of our culture going forward.

Environmental, Social and Governance (“ESG”)

Gilead has also built a corporate social responsibility program to continue to execute its mission of providing lifesaving medicines in areas of unmet need.

Additional information about this program and ESG highlights are available in Gilead’s 2019 year in review under Gilead’s website at https://www.gilead.com/news-and-press/annual-report/year-in-review-2019.

Seasonality of Operations

Our worldwide product sales do not reflect any significant degree of seasonality in end-user demand.

In the United States, fluctuations in wholesaler inventory levels have impacted our product sales.

We have observed that strong wholesaler and sub-wholesaler purchases of our products in the fourth quarter have resulted in inventory draw-down by wholesalers and sub-wholesalers in the subsequent first quarter.

Several other factors, including government budgets, annual grant cycles for federal and state funds and other buying patterns, have impacted the product sales recorded in a particular quarter.

However, in the United States, fluctuations in wholesaler inventory levels impact our product sales.

We typically observe strong wholesaler and sub-wholesaler purchases of our products in the fourth quarter resulting in inventory draw-down by wholesalers and sub-wholesalers in the subsequent first quarter.

Several other factors, including government budgets, annual grant cycles for federal and state funds, the COVID-19 pandemic, and other buying patterns, also could impact the product sales recorded in a particular quarter.

For more information, see Item 1A.

Risk Factors “ Our inability to accurately predict demand for our products and fluctuations in purchasing patterns or wholesaler inventories makes it difficult for us to accurately forecast sales and may cause our forecasted revenues and earnings to fluctuate, which could adversely affect our financial results and stock price.

For the most part, we operate in markets characterized by short lead times and the absence of significant backlogs.

We do not believe that backlog information is material to our business as a whole.

Risk Factors “We face challenges in accurately forecasting sales because of the difficulties in predicting demand for our products and fluctuations in purchasing patterns or wholesaler inventories.”

Government Regulation

Our operations and activities are subject to extensive regulation by numerous government authorities in the United States, the European Union and other countries, including laws and regulations governing the testing, manufacture, safety, efficacy, labeling, storage, record keeping, approval, advertising and promotion of our products.

As a result of these regulations, product

development and product approval processes are very expensive and time consuming.

As a result of these regulations, product development and product approval processes are very expensive and time consuming, which has a significant impact on our capital expenditures and results of operations.

The regulatory requirements applicable to drug development and approval are subject to change.

Any legal and regulatory changes may impact our operations in the future.

A country’s regulatory agency, such as FDA in the United States and European Commission for the European Union, as well as the national authorities of the European Union Member States, must approve a drug before it can be sold in the respective country or countries.

A country’s regulatory agency, such as FDA in the United States and the European Medicines Agency and European Commission for the European Union, as well as the national authorities of the European Union Member States, must approve a drug before it can be sold in the respective country or countries.

The general process for drug approval in the United States is summarized below.

Many other countries, including countries in the European Union, have similar regulatory structures.

Many other countries, including countries in the European Union (and the European Union under a centralized procedure), have similar regulatory structures.

Preclinical Testing

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It is not uncommon for a drug candidate that appears promising in Phase 1 clinical trials to fail in the more rigorous and extensive Phase 2 clinical trials.

If a drug candidate appears to be effective and safe in Phase 2 clinical trials, Phase 3 clinical trials are commenced to confirm those results.

If a drug candidate appears to be effective and have an appropriate safety profile in Phase 2 clinical trials, Phase 3 clinical trials are commenced to confirm those results.

Phase 3 clinical trials are conducted over a longer term, involve a significantly larger population, are conducted at numerous sites in different geographic regions and are carefully designed to provide reliable and conclusive data regarding the safety and benefits of a drug candidate.

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FDA Approval Process

When we believe that the data from our clinical trials show an acceptable benefit-risk profile, we submit the appropriate filing, usually in the form of a New Drug Application (NDA) or supplemental NDA, with FDA seeking approval to sell the drug candidate for a particular use.

When we believe that the data from our clinical trials show an acceptable benefit-risk profile, we submit the appropriate filing, usually in the form of a New Drug Application (“NDA”), Biologics License Application (“BLA”) or supplemental application, with FDA seeking approval to sell the drug candidate for a particular use.

At FDA’s discretion, FDA may hold a public hearing where an independent advisory committee of expert advisors asks additional questions and makes recommendations regarding the drug candidate.

This committee makes a recommendation to FDA that is not binding but is generally followed by FDA.

If FDA agrees that the compound has met the required level of safety and efficacy for a particular use, it will allow us to sell the drug candidate in the United States for that use.

It is not unusual, however, for FDA to reject an application because it believes that the drug candidate is not safe enough or efficacious enough or because it does not believe that the data submitted is reliable or conclusive.

If FDA agrees that the drug has met the required level of safety and efficacy for a particular use, it will approve the application and allow us to sell the drug in the United States for that use.

It is not unusual, however, for FDA to decline to approve an application because it believes that the drug candidate is not safe enough or efficacious enough (i.e.

does not have an appropriate benefit versus risk profile) or because it does not believe that the data submitted is reliable or conclusive.

At any point in this process, the development of a drug candidate can be stopped for a number of reasons including safety concerns and lack of treatment benefit.

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Our manufacturing facilities in Canada, Ireland and Netherlands also must obtain local licenses and permits in compliance with local regulatory requirements.

Drugs that treat serious or life-threatening diseases and conditions that are not adequately addressed by existing drugs, and for which the development program is designed to address the unmet medical need, may be designated as fast track candidates by

FDA and may be eligible for priority review.

Drugs for the treatment of HIV infection that are designated for use under the U.S.

President’s Emergency Plan for AIDS Relief may also qualify for an expedited review.

FDA may employ one of several tools to facilitate and expedite the development and review of a drug, including fast track designation, Breakthrough Therapy designation, accelerated approval and Priority Review designation.

Fast track designation is designed to facilitate the development and review of a drug that treats a serious condition and fills an unmet medical need.

Breakthrough Therapy designation is designed to expedite the development and review of a drug that treats a serious condition and preliminary clinical evidence demonstrates substantial improvement over available therapies.

Accelerated approval of a drug may be granted by FDA where the drug treats a serious condition, fills an unmet medical need and has been studied for safety and efficacy.

Priority Review designation means FDA’s goal is to take action on an application within six months of filing.

FDA may grant Priority Review designation to a drug that would provide significant improvement in the safety or effectiveness of a treatment, diagnosis or prevention of a serious condition.

European Union Regulatory System and Approval Process

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We are required to obtain a marketing authorization in the EU before we can market our medicinal products on the relevant market.

The conduct of clinical trials in the EU is governed by, among others, Directive 2001/20/EC and the EU Good Clinical Practice rules.

The conduct of clinical trials in the EU is governed by, among others, Directive 2001/20/EC and Directive 2005/28/EC and the EU (ICH) Good Clinical Practice rules.

These impose legal and regulatory obligations that are similar to those provided in applicable U.S.

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Pricing and Reimbursement

Successful commercialization of our products depends, in part, on the availability of governmental and third-party payer reimbursement for the cost of such products and related treatments in the markets where we sell our products.

Successful commercialization of our products depends, in part, on the availability of third-party payer reimbursement for the cost of such products and related treatments and medical services in the markets where we sell our products.

Government health authorities, private health insurers and other organizations generally provide reimbursement.

In the United States, the European Union and other significant or potentially significant markets for our products and product candidates, government authorities and third-party payers are increasingly attempting to limit or regulate the price of medical products and services.

A significant portion of our sales of the majority of our products are subject to substantial discounts from their list prices.

In the United States, the European Union and other significant or potentially significant markets for our products and product candidates, government authorities and private payers are increasingly attempting to limit or regulate the price of medical products and services.

A significant portion of our sales of the majority of our products are subject to substantial discounts from their list prices, including rebates we may be required to pay to Medicaid agencies or discounts we may be required to pay to 340B covered entities.

As a result, the price increases we implement from time to time on certain products may have a limited effect on our product sales in certain markets.

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For more information, see Item 1A.

Risk Factors “ Our existing products are subject to reimbursement from government agencies and other third parties, and we may be required to provide rebates and other discounts on our products, which may result in an adjustment to our product revenues.

Pharmaceutical pricing and reimbursement pressures may adversely affect our profitability and our results of operations ” and “ Our inability to accurately predict demand for our products and fluctuations in purchasing patterns or wholesaler inventories makes it difficult for us to accurately forecast sales and may cause our forecasted revenues and earnings to fluctuate, which could adversely affect our financial results and stock price.

Risk Factors “Our existing products are subject to reimbursement pressures from government agencies and other third parties, required rebates and other discounts on our products and other pricing pressures” and “We face challenges in accurately forecasting sales because of the difficulties in predicting demand for our products and fluctuations in purchasing patterns or wholesaler inventories.”

Patient Assistance Programs

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federal and state laws pertaining to health care “fraud and abuse,” including anti-kickback laws and false claim laws.

Anti-kickback laws make it illegal for a prescription drug manufacturer to solicit, offer, receive or pay any remuneration in exchange for, or to induce, the referral of business, including the purchase or prescription of a particular drug.

Due to the breadth of the statutory provisions and the attention being given to them by law enforcement authorities, it is possible that certain of our practices may be challenged under anti-kickback or similar laws.

Anti-kickback laws make it illegal for a prescription drug manufacturer to knowingly and willingly solicit, offer, receive or pay any remuneration in exchange for, or to induce, the referral of business reimbursed by a federal healthcare program, including the purchase or prescription of a particular drug.

False claims laws generally prohibit anyone from knowingly presenting, or causing to be presented, a false or fraudulent claim for payment by federal and certain state payers (including Medicare and Medicaid), or knowingly making, using or causing to be made or used, a false record or statement material to a false or fraudulent claim.

Our sales, marketing, patient support and medical activities may be subject to scrutiny under these laws.

Due to the breadth of the statutory provisions and the attention being given to them by law enforcement authorities, our sales, marketing, patient support and medical activities may be subject to scrutiny under these laws.

For example, recently there has been enhanced scrutiny by government enforcement authorities of company-sponsored patient assistance programs, including co-pay assistance programs and manufacturer donations to third-party charities that provide such assistance, reimbursement support offerings, clinical education programs and promotional speaker programs.

Similarly, in Europe, interactions between pharmaceutical companies and physicians are subject to strict laws, regulations, industry self‑regulation codes of conduct and physicians’ codes of professional conduct, as applicable, including the EU Member States anti-corruption laws and the UK Bribery Act 2010.

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In certain circumstances, strict compliance with anti-bribery laws may conflict with local customs and practices or may require us to interact with doctors and hospitals, some of which may be state controlled, in a manner that is different than local custom.

Despite our training and compliance program, our internal control policies and procedures may not protect us from reckless or criminal acts committed by our employees or agents.

Despite our training and compliance program, our internal control policies and procedures may not protect us from unlawful acts committed by our employees or agents.

Violations of fraud and abuse laws or anti-bribery laws may be punishable by criminal and/or civil sanctions, including fines and civil monetary penalties, as well as the possibility of exclusion from federal health care programs (including Medicare and Medicaid).

Violations can also lead to the imposition of a Corporate Integrity Agreement or similar government oversight program.

Any similar violations by our competitors could also negatively impact the reputation of our industry and increase governmental and public scrutiny over our business and our products.

Healthcare Reform

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For more information, see Item 1A.

Risk Factors “Our results of operations may be adversely affected by current and potential future healthcare legislative and regulatory actions” and “Laws and regulations applicable to the health care industry could impose new obligations on us, require us to change our business practices and restrict our operations in the future.”

As of January 31, 2020, we had approximately 11,800 employees.

We believe we have good relations with our employees.

Risk Factors “We are impacted by evolving laws, regulations and legislative or regulatory actions applicable to the health care industry.”

We are subject to a number of laws and regulations that require compliance with federal, state, and local regulations for the protection of the environment.

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and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act.

Website references are provided throughout this document for convenience.

The content on the referenced websites does not constitute a part of and is not incorporated by reference into this Annual Report on Form 10-K.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business