Gilead Paid $405 Million for a Drug It Just Threw in the Trash

The most likely culprits are the usual suspects: disappointing clinical data, safety signals, or a realization that the biology simply didn't translate from the lab to actual patients. MB272 was testing a genuinely novel mechanism. That's exciting on a whiteboard, but novel mechanisms fail at notoriously high rates in the clinic. The odds were never in MiroBio's favor.

When Gilead booked the deal in 2022, it expensed the vast majority of the purchase price as acquired in-process R&D, reducing GAAP and non-GAAP earnings per share by $0.30 to $0.35 that year. Translation: Gilead's accountants basically told you from day one that this was a bet, not an asset.

A Pattern That's Getting Hard to Ignore

If this were an isolated incident, you could shrug it off. Every pharma company swings and misses. But Gilead has developed a habit of writing large checks for acquisitions that don't deliver.

The biggest wound is still Forty Seven, the company Gilead bought for $4.9 billion to get magrolimab, a promising cancer drug. That program hit a full FDA clinical hold after safety and efficacy failures. Billions, gone.

Then there's Immunomedics, acquired for a staggering $21 billion to get the cancer drug Trodelvy. Trodelvy reached the market, but it hasn't come close to generating the blockbuster returns that price tag implied. Analysts widely consider that deal a mixed outcome at best.

Now add MiroBio's $405 million to the pile. On its own, it's a rounding error for a company Gilead's size. But as part of a pattern, it tells a story about capital allocation discipline, or the lack thereof. The Street has noticed: analysts at RBC flagged after the magrolimab failure that the result could "further hurt sentiment around both their oncology programs and their M&A prowess," pointing to a "string of setbacks in recent years from acquired or partnered programs."

The $11.5 Billion Elephant in the Room

Here's where the timing gets awkward. In 2026, Gilead has booked $11.5 billion in deal-related charges tied to its recent acquisition spree, including purchases of Arcellx ($7.8 billion for a CAR-T therapy), Ouro Medicines (autoimmune), and Tubulis (antibody-drug conjugates). Those charges are large enough to push Gilead into a GAAP loss for the year, even though its HIV franchise still prints money.

So at the exact moment Gilead is asking investors to trust it with billions more in new deals, it's also admitting that one of its earlier bets was a total write-off. It's like asking your friends to invest in your new restaurant while the last one is still smoldering.

Analysts aren't panicking (most still rate Gilead a Buy with targets around $150 to $160), but the skepticism around deal-making is palpable. The MiroBio discontinuation isn't changing anyone's model in a meaningful way; the financial impact is too small. What it is doing is reinforcing a narrative that Gilead systematically overpays for early-stage science.

The Inflammation Bet Isn't Dead (Just Bruised)

To be fair, Gilead hasn't abandoned its autoimmune ambitions. The company says it now has 13 inflammation assets ranging from preclinical through Phase 2, plus seladelpar, a drug for primary biliary cholangitis (a chronic liver disease) that already has accelerated approval in the U.S. Multiple data readouts across the inflammation portfolio are expected in 2026, which leadership has called "a very exciting year to help us build our foundation in inflammation."

Gilead has also organized its immunology R&D around a framework it calls BETR: Blocking immune activation, Eliminating pathogenic cells, Tolerizing immune response, and Restoring tissue function. The company is even exploring whether Kite, its cell therapy division, can extend engineered cell approaches beyond cancer into autoimmune diseases.

So the strategy is intact. The question is whether investors should trust the execution.

What This Really Comes Down To

Gilead's M&A track record looks like a batting average with a few home runs and a lot of strikeouts. Pharmasset (hepatitis C, approximately $11 billion) was a grand slam. Kite Pharma (cell therapy) produced two marketed products. But the misses have been expensive, and they're accumulating.

For a company spending $11.5 billion on new deals this year alone, the MiroBio write-off serves as a pointed reminder: buying science is easy; turning it into medicine is the hard part. Investors will be watching those 2026 inflammation readouts very closely. Not just for the data, but for evidence that Gilead has learned something from its most expensive mistakes.

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