Gilead Woman Scientist

Image source: Gilead Sciences.

If you're expecting Gilead Sciences (NASDAQ:GILD) to stumble when it announces fourth-quarter results on Feb. 2, history isn't on your side. It's been quite a while since the biotech truly disappointed in a quarterly earnings report. 

Things could always change, though. Here are three key things to watch that could make the difference in whether the big biotech continues its winning ways.

1. Payer purse strings
Payer reimbursement restrictions remains the most significant challenge for Gilead's hepatitis C virus (HCV) drugs Harvoni and Sovaldi. The high price tags of the drugs has caused sticker shock for insurers and pharmacy benefit managers. In many cases, only patients with high fibrosis scores are eligible to receive reimbursement.

These tight payer purse strings have a ripple impact throughout the healthcare system. Many physicians are skittish about even writing a prescription for Harvoni or Sovaldi unless patients are very sick, because they are afraid payers will turn down payment. Those fears are warranted. The rejection rates for prescriptions for patients with lower fibrosis scores are high.

Gilead has been crossing its fingers that two factors will help sway payers to loose their restrictions. First, the biotech thinks that more stability in patient volumes will help. Payers were flooded with patients wanting Harvoni and Sovaldi when the drugs first hit the market. As time has passed, payers and PBMs should be better able to model the financial impact of the high-dollar drugs. 

The other factor that Gilead hopes will help is increasing data showing the cost effectiveness of treating HCV patients using Harvoni and Sovaldi. In particular, Gilead would like payers to closely examine the total costs of treating less sick patients earlier.

Will either of these factors make a dent in the biotech's fourth-quarter numbers? Maybe not, but I'm definitely looking forward to seeing Gilead's profiles of HCV patients that are intended for treatment with its drugs. Any increase in the percentage of patients with lower fibrosis scores in this mix would bode well for the company headed into 2016.    

2. International intrigue 
Perhaps the best news for Gilead in the third quarter was how well HCV sales were growing in international markets. While Europe experienced strong growth in the third quarter of 2015 compared to the prior year, sales dipped from the second quarter. However, international sales outside of Europe soared 853% year over year.

It's quite possible that international sales will provide the spark that Gilead needs to keep its momentum going while it waits for U.S. payers to relax reimbursement restrictions. All international markets, including Europe, made up a third of the biotech's total HCV revenue last quarter. That portion should continue to climb, making international sales ever more important for Gilead. 

And while Europe was something of a disappointment in the third quarter, I think that was only temporary. The sequential decline in European sales was probably a seasonal issue, which could set up fourth-quarter sales to shine.

3. Competitor's complications 
Gilead also could benefit from AbbVie's (NYSE:ABBV) woes. In October, AbbVie had to update the label for rival HCV drug Viekira Pak because of safety concerns for patients with Child-Pugh B cirrhosis. 

Will AbbVie's woes have any impact for Gilead's fourth-quarter sales? It's possible. While payer contracts wouldn't be affected, physician and patient perceptions very well could be. I wouldn't underestimate the potential for Viekira Pak's label change to reinforce suspicions that the drug just isn't as safe as Gilead's Harvoni and Sovaldi.

AbbVie reported third-quarter sales for Viekira Pak of $469 million. That's a far cry from the $4.8 billion that Harvoni and Sovaldi generated in the same period. However, should Gilead gain any appreciable market share from its main HCV rival, it could be enough to play a factor in the biotech's fourth-quarter performance.

Wild cards
You've probably noticed that all three of the above focus on Gilead's HCV drugs. There are other wild cards that could be key for the biotech in fourth quarter, though. Over 40% of Gilead's revenue stems from sales of non-HCV drugs.

Investors will want to pay particular attention to trends with Gilead's HIV franchise. Stribild and Truvada are doing well, but any setbacks on the HIV front could overcome good news for Harvoni and Sovaldi. 

Keith Speights owns shares of Gilead Sciences. The Motley Fool owns shares of and recommends Gilead Sciences. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.