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A Leader in Biotech

With volatility off the charts lately, an investor's eyes naturally heads toward stocks in the health-care area. Now normally I never, ever recommend biotech stocks. Never. Ever. They're too risky, there's too much hype and too few profits. And due to licensing and patent laws, many biotech products are too easily copied and therefore they can't keep their pricing edge.

There is one exception, however, and that is Gilead Sciences (GILD). It has leveraged its research and marketing strength into an unblemished 10-year record of fundamental and investment strength. Their innovative business has risen above other biotech companies, making it a leader in the industry.

The biotech giant specializing in difficult infectious diseases like HIV, hepatitis B and influenza reported healthy quarterly results last week. Earnings came in at 45 cents per share, beating estimates of 42 cents, thanks to a strong performance out of its HIV products. Sales of the company's HIV lineup increased 2.9% to $806 million, driving total revenue to just over $1 billion. These are fantastic results.

The crown jewel of Gilead's HIV-fighting arsenal is a concoction dubbed Atripla. This drug combines one of Bristol-Myers Squibb's non-nucleoside reverse transcriptase inhibitors, or NNRTIs, with two of Gilead's nucleoside reverse transcriptase inhibitors, known as NRTIs.

All together, Gilead controls some 54% of the U.S. market for NRTIs, up from 45% last year, and Atripla makes up a large portion of these sales. For each 30-pill bottle of Atripla sold, some $780 goes to the company. During the third quarter alone, U.S. sales of the antiviral drug totaled $240 million.

But Gilead isn't just settling with great sales in the U.S. Recently, the company announced that Atripla was approved in Canada for use by adults infected with HIV. This gives the 60,000 people who have HIV and are living in Canada another treatment option for the deadly disease. Looking ahead, the European Medicines Agency is also set to approve the use of Atripla across Europe by the end of the year.