Gilead Sciences Inc. reported third-quarter net income of $398.3 million, or $0.42 per diluted share, beating consensus analyst estimates of $381.06 million, or $0.39 per share.

The Foster City, Calif.-based company's HIV franchise once again drove the quarter, bringing in $805.8 million, up 45 percent from $557.3 million in the third quarter of 2006.

Truvada (emtricitabine and tenofovir disoproxil fumarate), the combination nucleoside analogue reverse transcriptase inhibitor (NRTI), led the pack with third-quarter sales of $409.1 million, up 32 percent from $309 million in the third quarter of 2006 and beating analyst estimates of $390.2 million. Also showing strong numbers was once-daily Atripla, which combines Gilead's emtricitabine 200 mg and tenofovir disoproxil fumarate 300 mg with New York-based Bristol-Myers Squibb Co.'s efavirenz 600 mg. Atripla sales brought in $241.1 million for the quarter, more than three times the $68.4 million recorded in the third quarter of 2006, when the drug was first launched in the U.S.

In a research note, Lazard Capital Markets analyst Joel Sendek wrote that a physician survey indicated Atripla's cannibalization of Truvada sales is over, and sales of both drugs are expected to grow, as Atripla takes market share from Combivir (lamivudine and zidovudine, GlaxoSmithKline plc) and Truvada "establishes itself as the backbone of choice for protease inhibitor combinations."

Third-quarter growth in Atripla and Truvada sales more than made up for declining sales of the HIV drugs Viread (tenofovir disoproxil fumarate) and Emtriva (emtricitabine). Viread posted third-quarter sales of $149.1 million, down 13 percent from the same quarter last year, and Emtriva posted sales of $6.5 million, down 30 percent.

Beyond HIV, Gilead saw strong growth with the hepatitis B drug Hepsera (adefovir dipivoxil), with third-quarter sales of $79.3 million, up 44 percent from $55.1 million in the same quarter of 2006 and beating analyst estimates of $75.1 million. Significant revenue also came from Basel, Switzerland-based F. Hoffmann-La Roche Ltd.'s sales of Tamiflu (oseltamivir phosphate), from which Gilead collected third-quarter royalties of $77.4 million.

All told, Gilead's third-quarter product sales totaled a record $961.9 million, driving total revenues of $1.06 billion, up 41 percent from total revenues of $748.7 million in the same quarter last year. During a conference call, John Milligan, Gilead's chief operating officer, projected that total product sales for the year likely would come in at the high end of the previously projected $3.6 billion to $3.7 billion range.

Gilead reported $2.22 billion in cash, equivalents and marketable securities as of Sept. 30. Milligan said the company continues to "actively evaluate strategic ways to use our cash, including opportunities to in-license or acquire products."

Earlier in the quarter, Gilead picked up the preclinical epithelial sodium channel inhibitor P-680 from Parion Sciences Inc. in a deal worth up to $156 million. (See BioWorld Today, Aug. 17, 2007.)

Along with earnings, Gilead disclosed last week that Caroline Dorsa, who spent 20 years with Whitehouse Station, N.J.-based Merck & Co. Inc., will join the company next month as senior vice president and chief financial officer. Gilead also foreshadowed more Atripla growth by announcing that the drug was approved by Health Canada and received a positive opinion from Europe's Committee for Medicinal Products for Human Use in the treatment of HIV patients failing three months of treatment with other antiretroviral therapy.

The European Commission will review the CHMP's recommendation and is expected to issue its decision near the end of the year.

Shares of Gilead (NASDAQ:GILD) fell $1.51 Friday to close at $42. Jefferies & Co. Inc. analyst Eun Yang noted in a research report that the company is trading near its 52-week high with limited near-term catalysts. Yang predicted the stock will "take a breather" and recommended buying on weakness.

In other earnings news:

• Angiotech Pharmaceuticals Inc., of Vancouver, British Columbia, saw its shares fall more than 34 percent after announcing preliminary third-quarter results and lowering earnings guidance for the year. For the third quarter, the company reported total revenues of $68 million, down from $86 million in the same period last year, and said it expected to post a net loss. Angiotech also lowered its full-year 2007 adjusted EBITDA outlook range to $47 million to $50 million from its previously projected range of $85 million to $95 million. The revision reflects lower than expected product sales revenues and potentially increased expenses. Full third-quarter results will be released Nov. 1. Angiotech's shares (NASDAQ:ANPI) fell $2.55 on Friday to close at $4.98.

• Genitope Corp., of Fremont, Calif., filed a shelf registration statement to offer, from time to time, up to $125 million of any combination of stocks, warrants and debt securities, with specific terms to be set at the time of any offering. Proceeds would be used for general corporate purposes, including for clinical trials and other expenses related to the potential commercialization of MyVax in follicular B-cell non-Hodgkin's lymphoma, as well as for research and development of the company's monoclonal antibody candidates. Shares of Genitope (NASDAQ:GTOP) closed at $3.38 Friday, down 19 cents.

• SemBioSys Genetics Inc., of Calgary, Alberta, is raising $6.5 million to advanced its plant-manufactured insulin and its cardiovascular therapeutic, Apo AI, in preclinical and clinical development. The company agreed to issue 2.5 million units - each unit consisting of one common share and one half of a common share purchase warrant - priced at $2.60 each, on a bought-deal private placement basis, to underwriters led by Acumen Capital Finance Partners Ltd., and including PI Financial Corp. Those underwriters also have an overallotment option for an additional 375,000 units, which, if exercised in full, would raise the total financing to $7.5 million. The offering is expected to close on or about Nov. 14, 2007.