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The Payers Who Never Place an OrderThin moat

Gilead Sciences (GILD) — moat facet

Payers who never order a Gilead drug took back $17.5 billion in rebates and chargebacks in 2025, about 60% of net product sales.

The customers who decide whether a Gilead drug is used are not the ones who buy it. Wholesalers place the orders; insurers, pharmacy benefit managers, Medicaid and Medicare decide coverage, and collect rebates in return. In 2025 rebates and chargebacks were $17.5 billion1, equal to about 60% of Gilead's net product sales of $28,915 million23.

Gilead rebates and chargebacks vs net product sales ($bn)15.5Rebates 202428.6Net sales 202417.5Rebates 202528.9Net sales 2025Gilead Form 10-K FY2025, gross-to-net footnote and income statement
The payers took back about sixty cents for every dollar Gilead kept.

That is the real concentration in the business. A handful of large payers set formulary positions for most American patients, and a drug that loses its place on a formulary loses access regardless of its patent. Gilead's 10-K lists "pricing pressures from private insurers and government payers" as one of the main forms of competition it faces4.

Government is a large payer and is becoming more assertive. Biktarvy was selected for Medicare price negotiation in January 20265. Gilead agreed in December 2025 to MFN prices in Medicaid for select existing products6. The details are on the pricing pages; the point here is that the customer who decides is now also writing the price.

At the end of 2025 Gilead owed $4,337 million of accrued rebates7. That liability is the running bill from the customers who never place an order.

The running balance shows the trend. Accrued rebates were $3,802 million at the end of 2023, $3,892 million a year later and $4,337 million at the end of 202589. The 10-K describes the pressure plainly: "pricing pressures from private insurers and government payers as our products mature, which often result in a reduction of our net product prices"10. The payers' share rises as Gilead's products age.

The payer relationship is the one to watch. If rebates and chargebacks grow faster than gross product sales for a third consecutive year, the payers will be taking a rising share of what Gilead's patents are supposed to protect.

Moat trajectory: Narrowing

Rebates and chargebacks $17.5bn from $15.5bn.

The number that tests this moat
Moat Explorer calc
Rebates and chargebacks as a share of net product sales, full year
about 60% ($17.5bn of $28,915M in 2025), from about 54% in 2024

How much the deciding customers take back; rising again in 2026 would mean the 2025 jump was not one-off.

How it's calculated: Rebates and chargebacks (footnote to the gross-to-net table) divided by net product sales, Gilead Form 10-K FY2025.
Source: Moat Explorer calculation from Gilead Sciences filings ↗
References
  1. ReportedIn 2025 rebates and chargebacks were $17.5 billion, equal to about 60% of Gilead's net product sales of $28,915 million.
    Gilead Sciences Form 10-K for 2025 - customers, wholesalers, distribution and gross-to-net deductions. — FY2025 · publ. 24 February 2026 · source ↗
  2. ReportedIn 2025 rebates and chargebacks were $17.5 billion, equal to about 60% of Gilead's net product sales of $28,915 million.
    Gilead Sciences Form 10-K for 2025 - customers, wholesalers, distribution and gross-to-net deductions. — FY2025 · publ. 24 February 2026 · source ↗
  3. Moat Explorer calcIn 2025 rebates and chargebacks were $17.5 billion, equal to about 60% of Gilead's net product sales of $28,915 million.
    Moat Explorer calculation from Gilead Sciences reported figures ($ millions unless stated). HIV and Biktarvy: HIV share of total revenues 20,752 / 29,443 = 70.5% (2025); of product sales 20,752 / 28,915 = 71.8%; 16,438 / 22,449 = 73.2% (2019); 16,315 / 27,305 = 59.8% (2021); 18,175 / 27,116 = 67.0% (2023); 19,612 / 28,754 = 68.2% (2024). Biktarvy share of total revenues 14,334 / 29,443 = 48.7%; of HIV 14,334 / 20,752 = 69.1%; Biktarvy US 11,467 / 14,334 = 80.0%; Biktarvy growth 2025 14,334 / 13,423 - 1 = +6.8%; 2019-2025 14,334 / 4,738 = 3.0 times, (3.03)^(1/6) - 1 = about 20% a year. Other HIV 20,752 - 14,334 = 6,418; HIV other than Biktarvy, Descovy, Genvoya and Odefsey 20,752 - 14,334 - 2,758 - 1,498 - 1,167 = 995; Veklury plus Other plus royalties 911 + 799 + 527 = 2,237. Genvoya 1,498 / 3,931 - 1 = -61.9%. HIV growth 2019-2025 20,752 / 16,438 - 1 = +26.2%, about 4.0% a year; 2021 16,315 / 16,938 - 1 = -3.7%; 2023 18,175 / 17,194 - 1 = +5.7%; 2024 19,612 / 18,175 - 1 = +7.9%; 2025 20,752 / 19,612 - 1 = +5.8%, about 6%; H1 2026 10,723 / 9,675 - 1 = +10.8%; Q2 2026 5,693 / 5,088 - 1 = +11.9%. Descovy 2025 2,758 / 2,113 - 1 = +30.5%, about 31%; Q2 2026 967 / 653 - 1 = +48.1%; Descovy over Yeztugo Q2 2026 967 / 232 = 4.2, about four times. Yeztugo Q1 2026 = H1 397 - Q2 232 = 165; Yeztugo over Biktarvy H1 2026 397 / 7,133 = 5.6%, about 6%. US HIV 16,904 / 20,752 = 81.5%, about 81%; US product sales 20,816 / 28,915 = 72.0%; Europe 4,617 / 28,915 = 16.0%. Gilead HIV growth Q2 2026 +11.9% less ViiV +11% = about +1 point. Exclusivity: Descovy + Vemlidy + Odefsey 2,758 + 1,070 + 1,167 = 4,995, about $5.0bn, / 29,443 = 17.0% of revenue; Descovy + Vemlidy 2,758 + 1,070 = 3,828; Vemlidy share of Liver Disease 1,070 / 3,217 = 33.3%, a third; 2025 sales by primary US patent window: Tecartus 344 + Genvoya 1,498 = 1,842 (2027-2029); Trodelvy 1,397 + Descovy 2,758 + Vemlidy 1,070 + Odefsey 1,167 + sofosbuvir/velpatasvir 1,272 = 7,664 (2028-2033); Biktarvy 14,334 (2036). Hepatitis C 2015 Harvoni 13,864 + Sovaldi 5,276 = 19,140, / product sales 32,151 = 59.5%, about 60%; product sales 2018 21,677 / 32,151 - 1 = -32.6%; Liver Disease 2025 3,217 / 19,140 = 16.8%, about 17%, a sixth. Liver Disease 2019 HCV 2,936 + HBV/HDV 742 = 3,678; 2020 2,064 + 860 = 2,924. Price: gross product sales 2025 28,915 + 19,953 = 48,868, about $48.9bn; 2024 28,610 + 17,776 = 46,386; net product sales growth 28,915 / 28,610 - 1 = +1.1%, about 1%; gross-to-net deductions 19,953 / 17,776 - 1 = +12.2%; accrued rebates 4,337 / 3,892 - 1 = +11.4%, about 11%; rebates and chargebacks over net product sales 17.5bn / 28,915 = 60.5%, about 60% (2025); 15.5bn / 28,610 = 54.2% (2024). H1 2026 capital expenditure = operating cash flow 6,117 - free cash flow 5,859 = 258. Three wholesalers 29% + 24% + 21% = 74% of gross product sales (2025); 29% + 23% + 21% = 73% (2024). Hepatitis C share of revenue 1,272 / 29,443 = 4.3%, about 4%; sofosbuvir/velpatasvir 2025 1,272 / 1,596 - 1 = -20.3%, a fifth; Mavyret 1,317 / 1,311 - 1 = +0.5%. Cash and capital: free cash flow over revenue 9,456 / 29,443 = 32.1%, about 32%; dividends paid over free cash flow 4,003 / 9,456 = 42.3%, about 42%; free cash flow left after dividends and buybacks 9,456 - 4,003 - 1,922 = 3,531. Dividend per share (3.16 / 1.29)^(1/10) - 1 = 9.4% a year; increases 1.84 / 1.29 - 1 = +42.6% (2016); 2.72 / 2.52 - 1 = +7.9% (2020); 3.00 / 2.92 - 1 = +2.7% (2023); 3.08 / 3.00 - 1 = +2.7% (2024); 3.16 / 3.08 - 1 = +2.6% (2025); quarterly 0.82 / 0.79 - 1 = +3.8% (2026). Buybacks 2015-2016 10,002 + 11,001 = 21,003, about $21bn; year-end market value 2016 over 2015 94.34 / 145.83 - 1 = -35.3%, about a third. Net debt 31 December 2025 = total debt 24,937 - cash and marketable debt securities 10,605 = 14,332; 30 June 2026 = 26,246 - 3,179 = 23,067; net debt over 2025 free cash flow 23,067 / 9,456 = 2.4 years. Interest over operating income 1,024 / 10,022 = 10.2%, about a tenth (2025); 977 / 1,662 = 58.8%, more than half (2024). Gilead stockholders equity 11,829 / 22,703 - 1 = -47.9%, about 48%; return on equity 2025 8,510 / ((19,330 + 22,703) / 2 = 21,017) = 40.5%. Acquisitions: Trodelvy IPR&D impairments 2.7bn (2022) + 2.4bn + 1.8bn (2024) + 1.75bn (2026) = 8.65bn of 15.8bn recorded = 54.7%; Trodelvy Q1 2026 = H1 859 - Q2 457 = 402; Kite plus Immunomedics 11,155 + 20,600 = 31,755, over $31bn; cell therapy 2025 1,839 / 1,973 - 1 = -6.8%; Arcellx IPR&D 7.0bn / cell therapy 2025 1.839bn = 3.8 years. Acquired IPR&D 2019 5,051 + 2020 5,856 + 2021 939 + 2022 944 + 2023 1,155 + 2024 4,663 + 2025 1,024 + H1 2026 11,290 = 30,922, about $30.9bn; acquired IPR&D 2019-2025 alone = 30,922 - 11,290 = 19,632; Biktarvy 2025 US 11,467 + outside US 1,676 + 1,190 = 14,334, all other revenues 29,443 - 14,334 = 15,109 (shown 15.1); net income 2019-2025 5,386 + 123 + 6,225 + 4,592 + 5,665 + 480 + 8,510 = 30,981, about $31.0bn. Revenue lines: Liver Disease share 3,217 / 29,443 = 10.9%, about 11%; Oncology share 3,236 / 29,443 = 11.0%; Oncology 2020 cell therapy 607 + Trodelvy 49 = 656; Oncology 2025 3,236 / 3,289 - 1 = -1.6%, about 2%; 2019-2025 3,236 / 456 = 7.1 times, about sevenfold. Veklury 2021 5,565 / 27,305 = 20.4%, about a fifth; 2025 911 / 29,443 = 3.1%; product sales 2021-2025 28,915 / 27,008 - 1 = +7.1%; excluding Veklury (28,915 - 911 = 28,004) / (27,008 - 5,565 = 21,443) - 1 = +30.6%, about 31%. Other product sales plus royalty, contract and other revenues: 1,547 + 330 = 1,877 (2019); 1,026 + 334 = 1,360; 1,027 + 297 = 1,324; 946 + 299 = 1,245; 859 + 182 = 1,041; 889 + 144 = 1,033; 799 + 527 = 1,326 (2025). Bands sum to total revenues: 2025 20,752 + 3,217 + 3,236 + 911 + 1,326 = 29,442 against reported 29,443 (rounding); 2019 16,438 + 3,678 + 456 + 0 + 1,877 = 22,449. Non-HIV revenue 29,443 - 20,752 = 8,691, / 29,443 = 29.5%. Valuation and earnings: trailing twelve months to June 2026 revenue 29,443 - H1 2025 13,749 + H1 2026 14,763 = 30,457; net income 8,510 - 3,275 + (-8,475) = -3,240; diluted EPS 6.78 - 2.61 + (-6.82) = -2.65. Year-end market value over net income and revenue: 2015 145.83bn / 18,108 = 8.05, / 32,639 = 4.47; 2016 94.34 / 13,501 = 6.99, / 30,390 = 3.10; 2017 93.58 / 4,628 = 20.2, / 26,107 = 3.58; 2018 80.92 / 5,455 = 14.8, / 22,127 = 3.66; 2019 82.21 / 5,386 = 15.3, / 22,449 = 3.66; 2020 73.03 / 123 = 594, / 24,689 = 2.96; 2021 91.08 / 6,225 = 14.6, / 27,305 = 3.34; 2022 107.68 / 4,592 = 23.4, / 27,281 = 3.95; 2023 100.94 / 5,665 = 17.8, / 27,116 = 3.72; 2024 115.12 / 480 = 240, / 28,754 = 4.00; 2025 152.28 / 8,510 = 17.9, / 29,443 = 5.17; October 2026 179.47bn / 30,457 = 5.89. 2026 product sales guidance midpoints (29,600 + 30,000) / 2 = 29,800 (February); (30,000 + 30,400) / 2 = 30,200 (May); (30,100 + 30,400) / 2 = 30,250 (August). Non-GAAP EPS guidance midpoint (-0.65 + -0.30) / 2 = -0.475, plus 9.08 of acquired IPR&D and tax per share = 8.61. Additional: dividends paid 3,918 / 3,809 - 1 = +2.9% (2024), 4,003 / 3,918 - 1 = +2.2% (2025); gross product sales 48,868 / 46,386 - 1 = +5.4%, about 5%; Epclusa 1,966 / 3,510 - 1 = -44.0%; US HIV over US product sales 16,904 / 20,816 = 81.2%; European HIV over European product sales 2,392 / 4,617 = 51.8%; analyst target 158.65 / 144.74 - 1 = +9.6%, about 10%; market value 2025 over 2024 152.28 / 115.12 - 1 = +32.3%, a third. AmBisome 509 / 533 - 1 = -4.5%. Biktarvy over HIV: 4,738 / 16,438 = 28.8% (2019); 8,624 / 16,315 = 52.9% (2021); 11,850 / 18,175 = 65.2% (2023). Descovy + Vemlidy + Odefsey: 1,500 + 488 + 1,655 = 3,643 (2019); 1,700 + 814 + 1,568 = 4,082 (2021); 1,985 + 862 + 1,350 = 4,197 (2023); 2,113 + 959 + 1,288 = 4,360 (2024). Apretude Q1 2026 = H1 260 - Q2 140 = 120 (GBP M). Livdelzi Q1 2026 = H1 300 - Q2 167 = 133 - prices, deductions, customers, geography and exclusivity. — FY2015-Q2 2026 · publ. October 2026 · source ↗
    Method: Arithmetic on figures reported in Gilead Sciences Forms 10-K, 10-Q and results releases, SEC XBRL, stockanalysis.com market values, and the GSK and AbbVie filings cited; each operand is stated in the source line.
  4. ReportedGilead's 10-K lists "pricing pressures from private insurers and government payers" as one of the main forms of competition it faces.
    Gilead Sciences Form 10-K for 2025 - Item 1 business and the revenue-by-product table: products, programs, employees and manufacturing. — FY2025 · publ. 24 February 2026 · source ↗
  5. ReportedBiktarvy was selected for Medicare price negotiation in January 2026.
    Gilead Sciences Form 10-K for 2025 - Item 1A risk factors and pricing regulation: the IRA, Medicare negotiation, Medicaid, the ACA and tariffs. — FY2025 · publ. 24 February 2026 · source ↗
  6. ReportedGilead agreed in December 2025 to MFN prices in Medicaid for select existing products.
    Gilead Sciences Form 10-Q for the quarter ended 30 June 2026 - acquired IPR&D for Arcellx, Tubulis and Ouro, the $1.75 billion Trodelvy impairment, debt, receivables and the December 2025 agreement with the US administration. — Q2 2026 · publ. 6 August 2026 · source ↗
  7. ReportedAt the end of 2025 Gilead owed $4,337 million of accrued rebates.
    Gilead Sciences Form 10-K for 2025 - customers, wholesalers, distribution and gross-to-net deductions. — FY2025 · publ. 24 February 2026 · source ↗
  8. ReportedAccrued rebates were $3,802 million at the end of 2023, $3,892 million a year later and $4,337 million at the end of 2025.
    Gilead Sciences Form 10-K for 2023 - revenue by product group for 2021-2023, wholesaler shares of total revenues and the 2023 balance sheet. — FY2023 · publ. February 2024 · source ↗
  9. ReportedAccrued rebates were $3,802 million at the end of 2023, $3,892 million a year later and $4,337 million at the end of 2025.
    Gilead Sciences Form 10-K for 2025 - customers, wholesalers, distribution and gross-to-net deductions. — FY2025 · publ. 24 February 2026 · source ↗
  10. ReportedThe 10-K describes the pressure plainly: "pricing pressures from private insurers and government payers as our products mature, which often result in a reduction of our net product prices".
    Gilead Sciences Form 10-K for 2025 - Item 1 business and the revenue-by-product table: products, programs, employees and manufacturing. — FY2025 · publ. 24 February 2026 · source ↗
Sources
Generated October 4, 2026