What is the competitive landscape for HIV PrEP injectables in low- and lower‑middle‑income markets, and how does lenacapavir compare to existing products like cabotegravir?

Competitive landscape

The low‑ and lower‑middle‑income (LMIC) segment for HIV‑PrEP injectables is still in its early growth phase, dominated today by cabotegravir (sold as Apretude for PrEP and Cabenuva for treatment). Cabotegravir is a 2‑month sub‑cutaneous injection that has already secured WHO pre‑qualification, FDA/EU approvals and large‑scale procurement contracts through PEPFAR, the Global Fund and UN‑ITA. Its presence in LMIC programs is cemented by a ~ $300‑$350 per dose cost that, while high for donors, is accepted because of the proven efficacy and the well‑established supply chain with ViiV (a GSK joint‑venture).

Gilead’s lenacapavir is a capsid‑inhibitor that can be administered only twice a year. If WHO pre‑qualification is achieved, the drug’s dosing schedule offers a stark logistical advantage in settings where clinic visits and cold‑chain capacity are limiting factors. The partnership with PEPFAR and the Global Fund signals that Gilead is positioning lenacapavir as a “next‑generation” PrEP, targeting up to 2 million people initially – a sizeable slice of the LMIC market that could translate into a multi‑hundred‑million‑dollar revenue pipeline once scaled.

Lenacapavir vs. cabotegravir

The longer half‑life and semi‑annual dosing could lead to higher adherence and lower operational costs for donor programs, giving lenacapavir a clear competitive edge, especially if Gilead can price it competitively. However, cabotegravir’s entrenched presence and robust safety data still give it a near‑term advantage in program roll‑outs.

Trading implications

• Gilead (GILD) – The PEPFAR partnership is a positive catalyst that should tighten the forward‑looking discount on Gilead’s equity. With a clear LMIC pipeline (≥ 2 M patients) and the potential to capture a share of the $1‑$1.5 B global PrEP market, the stock may experience short‑to‑medium term upside ahead of WHO pre‑qualification. Traders could consider a moderate‑size long position or add to existing exposure, especially if the next 12‑week earnings call provides updates on regulatory timing or pricing guidance.

• Cabotegravir (ViiV/GSK) – The announcement introduces competitive pressure that could modestly erode future market share growth in LMICs. While the drug’s current revenues are still sizable, the risk premium for GSK’s PrEP franchise may rise. A light short or neutral stance could be justified, with a watch‑list for any signals of pricing or supply‑chain concessions.

• Risk factors – Key watch‑points include WHO pre‑qualification timelines, potential generic competition on cabotegravir, Gilead’s manufacturing capacity, and donor funding levels (especially any policy shifts in PEPFAR or Global Fund allocations). A stop‑loss around 8‑10% downside for Gilead can protect against rollout delays, while any confirmed price‑point advantage for lenacapavir could trigger a re‑entry at higher multiples.