Gilead Sciences and PEPFAR: A Strategic Alliance to Redefine HIV Prevention and Market Leadership

Gilead Sciences’ partnership with PEPFAR to expand access to lenacapavir, a twice-yearly injectable HIV prevention medication, marks a pivotal moment in the global fight against HIV. By aligning its innovative pipeline with public health priorities, Gilead is not only addressing critical gaps in HIV prevention but also solidifying its competitive position in a market projected to grow at a compound annual growth rate (CAGR) of 5.1%, reaching $5.68 billion by 2034 [2]. This initiative, which aims to deliver lenacapavir to up to two million people in low- and lower-middle-income countries (LLMICs) over three years, underscores Gilead’s strategic pivot toward socially responsible innovation while safeguarding long-term shareholder value.

Strengthening Competitive Position Through Innovation and Access

Lenacapavir’s unique biannual dosing mechanism represents a paradigm shift in HIV prevention, offering a solution to adherence challenges that plague daily oral pre-exposure prophylaxis (PrEP) regimens. Clinical trials demonstrated 100% lower HIV incidence in young women in South Africa and Uganda and 89% lower incidence in gay and bisexual men compared to traditional PrEP pills [3]. This efficacy, combined with the convenience of twice-yearly injections, positions lenacapavir as a disruptive force in the HIV prevention market.

Gilead’s collaboration with PEPFAR and the Global Fund further amplifies its competitive edge. By supplying lenacapavir at no profit and securing royalty-free licensing agreements with six generic manufacturers, the company is fostering affordability and competition in 120 high-burden countries [1]. These agreements are designed to reduce costs as generic versions enter the market, ensuring sustained access while mitigating the risk of market saturation. According to a report by Custom Market Insights, the global HIV drugs market is expected to grow to $53.5 billion by 2034, with lenacapavir’s long-acting injectable format driving a significant portion of this expansion [4].

Enhancing Brand Equity Through Global Health Leadership

Gilead’s commitment to equitable access has bolstered its brand equity, aligning the company with global public health goals and enhancing its reputation among stakeholders. By prioritizing LLMICs—where 70% of the HIV burden is concentrated—Gilead is positioning itself as a leader in socially conscious innovation. The U.S. State Department’s pledge to facilitate affordable access through PEPFAR and the Global Fund further reinforces this narrative, ensuring lenacapavir is provided at cost in high-burden regions [4].

However, challenges remain. Critics highlight inconsistencies in licensing agreements, noting that upper-middle-income countries like Brazil and Peru—despite their significant HIV epidemics—are excluded from royalty-free manufacturing [3]. Such gaps could undermine Gilead’s brand equity if not addressed. Yet, the company’s proactive engagement with community advisory groups and global health organizations demonstrates a commitment to iterative improvement, mitigating reputational risks while maintaining its leadership role.

Driving Sustainable Shareholder Value

While lenacapavir’s no-profit pricing model may raise questions about short-term profitability, the long-term benefits for shareholder value are clear. By expanding access to LLMICs, Gilead is capturing market share in regions where demand for HIV prevention tools is growing. The Global Fund’s involvement ensures a stable supply chain, reducing operational risks and enabling predictable revenue streams. Additionally, the drug’s regulatory submissions in 18 countries by the end of 2025—leveraging streamlined pathways like the EU-Medicines for All (EU-M4all) opinion—accelerate market entry and revenue generation [1].

Financial projections further validate this strategy. Gilead’s Q2 2025 earnings of $2.01 per share and $7.1 billion in revenue, exceeding market expectations, highlight the company’s robust financial health [5]. With lenacapavir poised to capture 60% of the U.S. market for Descovy/lenacapavir by mid-2030, Gilead is capitalizing on both domestic and international demand, ensuring a diversified revenue base.

Challenges and the Path Forward

Despite its strengths, Gilead must navigate complex geopolitical and operational challenges. The Trump administration’s push for domestic manufacturing could divert resources from global health initiatives, potentially slowing lenacapavir’s rollout in LLMICs [3]. Additionally, ensuring equitable access in excluded middle-income countries will require ongoing dialogue with stakeholders.

Nevertheless, Gilead’s strategic partnerships and innovative pipeline provide a buffer against these risks. By balancing commercial interests with public health imperatives, the company is not only addressing a critical unmet need but also securing its position as a market leader in an evolving HIV treatment landscape.

Conclusion

Gilead Sciences’ partnership with PEPFAR represents a masterclass in aligning innovation with global health equity. Through lenacapavir, the company is redefining HIV prevention while strengthening its competitive position, brand equity, and shareholder value. As the HIV drugs market expands, Gilead’s ability to navigate regulatory, ethical, and geopolitical challenges will determine its long-term success. For investors, this initiative underscores the company’s commitment to sustainable growth in a sector where social impact and financial returns are increasingly intertwined.

Source:
[1] Gilead Announces Partnership With PEPFAR to Deliver Twice-Yearly Lenacapavir for HIV Prevention for up to Two Million People in Primarily Low- and Lower-Middle-Income Countries [https://www.businesswire.com/news/home/20250903204152/en/Gilead-Announces-Partnership-With-PEPFAR-to-Deliver-Twice-Yearly-Lenacapavir-for-HIV-Prevention-for-up-to-Two-Million-People-in-Primarily-Low--and-Lower-Middle-Income-Countries]
[2] Global Lenacapavir Injection Market Size, Trends and Insights By Indication (HIV Treatment, Pre-Exposure Prophylaxis (PrEP)), By Formulation (Injectable, Oral Tablets), By Distribution Channel (Branded Medicine, Generic Medicine), and By Region - Global Industry Overview, Statistical Data, Competitive Analysis, Share, Outlook, and Forecast 2025–2034 [https://www.custommarketinsights.com/report/lenacapavir-injection-market/]
[3] Manufacturer's plans for equitable access to twice-yearly PrEP under fire [https://www.aidsmap.com/news/apr-2025/manufacturers-plans-equitable-access-twice-yearly-prep-under-fire]
[4] HIV Drugs Market Size, Share | Growth CAGR of 4.4% [https://market.us/report/global-hiv-drugs-market/]
[5] Gilead Sciences: Is There Momentum to Sustain Market [https://stockstotrade.com/news/gilead-sciences-inc-gild-news-2025_08_08/]