Gilead Sciences (NASDAQ:GILD) has seen quite a bit of competition in the hepatitis C (HCV) space, but now investors in the big biotech also need to start worrying about potential competition for its HIV drugs, a segment that has been growing.

Drug Class

Q2 2018 Sales

Year-Over-Year Change

HIV

$3.7 billion

15.6%

HCV

$1.0 billion

(65.5%)

Data source: Gilead Sciences.

12 is way less than 365

Yesterday, Johnson & Johnson (NYSE:JNJ) and ViiV Healthcare, a joint venture between GlaxoSmithKline (NYSE:GSK), Pfizer (NYSE:PFE), and Shionogi, announced positive results from the Atlas phase 3 study testing their two-drug HIV treatment containing an investigational drug cabotegravir and rilpivirine, a nucleoside reverse transcriptase inhibitor (NRTI) sold by Johnson & Johnson as Edurant.

The statement was light on the details, but the companies noted that the proportion of patients who were already taking medication and switched to the combination had plasma HIV-1 RNA below a defined level after 48 weeks of treatment was similar to patients who stayed on their three-drug combination of two NRTIs plus a third agent. Drugs such as Gilead's Biktarvy, Odefsey, and Complera 3-component combination pills would fit the description of drugs used by the control group.

Red ribbon on paper with definition of HIV/AIDS

Image source: Getty Images.

The important thing here isn't going from three medications to two, but that ViiV and Johnson & Johnson's cabotegravir and rilpivirine combination is injected once a month compared to a daily therapy for the three-drug combination. Normally patients prefer oral medication over injected ones, but when injections can be spaced a month apart, patients are more willing to tolerate the pain 12 times a year to not have to think about taking a pill every day.

Doctors are also likely to support monthly dosing because non-compliance with oral medication -- patients forgetting to take their pills or just not grasping the importance -- can lead to resistance of the virus to the medication.

More data to come

While the convenience factor could result in having ViiV and Johnson & Johnson take market share from Gilead, the devil is in the details of the study, which will be presented at an upcoming scientific meeting. It'll be important to see how similar -- the scientific term is "non-inferior" -- the two treatments really are, especially the rates that the virus becomes resistant to the drugs.

Safety will also be a major consideration because stopping a medication will often cause the side effects go away, which isn't really possible for a drug that's designed to stay in the body for a month. Long-term side effects, which may not be seen in this study, will also be important with HIV patients living 50 years or more taking viral suppressing medications. Gilead's newly approved Biktarvy contains components that are designed to be gentler on HIV patients' bones and kidneys.

In addition to the Atlas study results, ViiV and Johnson & Johnson are also expecting to complete a second phase 3 trial in treatment-naïve patients later this year. Those results are especially important because it's generally easier to capture a newly diagnosed patient than to get patients to switch from a regimen that's already working.

Further down the line, ViiV is also testing cabotegravir against Gilead's Truvada as a pre-exposure prophylaxis, or PrEP, in a pair of trials run by the National Institutes of Health. Gilead doesn't break out Truvada sales for PrEP, but the company has cited it as a growth driver as chief financial officer Robin Washington stressed on the first-quarter conference call: "We're really excited with the opportunity for HIV to be a growth business -- that's inclusive of PrEP as well -- but we're excited where we are for the year and for the opportunity to have this business be a growth trajectory for us beyond 2018."

Not if Johnson & Johnson, GlaxoSmithKline, Pfizer and Shionogi have anything to say about it.

Brian Orelli has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Gilead Sciences. The Motley Fool owns shares of Johnson & Johnson and has the following options: short October 2018 $135 calls on Johnson & Johnson. The Motley Fool has a disclosure policy.