S&P affirms Gilead Sciences

Standard & Poor's said it affirmed its A- corporate credit and senior unsecured ratings on Gilead Sciences Inc. following its agreement to purchase unrated Pharmasset Inc.

The agency said it expects Gilead to use its substantial free operating cash flow to rapidly reduce adjusted leverage.

"In our view, Gilead's purchase of Pharmasset (its lead hepatitis C, or HepC, treatment is only now entering phase 3 clinical trials) is an aggressive move to diversify Gilead's product portfolio beyond its heavy concentration on HIV treatments, currently about 80% of revenues," said S&P credit analyst David Lugg in a news release.

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