Gilead Files Government Lawsuit For HIV Research Breach


The MTAs and CTA are contracts that governed the terms of the more than 15-year collaboration between Gilead and CDC on various research studies relating to the use of antiretroviral agents for the prevention of HIV infection.

Gilead argues that in breach of these contracts, the US Department of Health and Human Services (HHS) filed for patent protection without notifying Gilead first.

Indeed, in 2015, HHS was granted four patents relating to the use of pre-exposure prophylaxis (PrEP). “The government recently filed suit against Gilead for infringement of these patents, which we strongly believe are invalid and should not have been granted” says Gilead.

The complaint alleges that, due to the contract breaches, Gilead has incurred legal fees and suffered reputational harm “due to the government’s inflammatory and selective allegations asserted in the patent infringement lawsuit.”

The company is now seeking a declaration of contract breach and damages in the Court of Federal Claims.

Nonetheless, Gilead confirmed that it will continue to work with federal agencies on ending the HIV epidemic and fighting COVID-19. “We remain firmly committed to our own efforts, and to supporting the government’s efforts, to substantially increase access to PrEP for people at risk for HIV” Gilead said.

Overall, GILD scores a Moderate Buy rating from the Street with a $77 average analyst price target (3% downside potential). Shares are currently trading up 23% year-to-date, with much of the attention focusing on its potential coronavirus vaccine remdesivir. (See Gilead stock analysis on TipRanks).

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