AbbVie Inc. shares rose the most in over two years after investors got a reassuring first look at projections for profit now that the company’s $20 billion-a-year drug, Humira, faces direct competition in the US.
(Bloomberg) — AbbVie Inc. shares rose the most in over two years after investors got a reassuring first look at projections for profit now that the company’s $20 billion-a-year drug, Humira, faces direct competition in the US.
Adjusted earnings for 2023 will range from $10.70 to $11.10 a share, the North Chicago-based drugmaker said Thursday, an outlook well short of Wall Street’s $11.65 consensus estimate. Several outliers skewed that estimate for AbbVie’s 2023 earnings, and many projections were closer to $10.50 a share, JPMorgan Securities analyst Chris Schott wrote in a note. AbbVie’s guidance should ease concerns, Schott said.
The relief was evident as Abbvie shares gained as much as 6.3%, the most intraday since November 2020.
Humira, a drug for patients with autoimmune conditions like Crohn’s disease and rheumatoid arthritis, has carried the load for AbbVie since it was introduced in 2002. The company successfully parried US patent challenges until Amgen Inc. last month launched Amjevita, the first near-identical version of Humira in the country; several more versions of the drug are slated to enter the market this year.
Investors have been anxiously awaiting details on how much sales would fall and when. AbbVie anticipates US sales of Humira will decrease about 37% this year, at the lower end of the previously guided range of 35% to 55%, Chief Executive Officer Rick Gonzalez said on a conference call with analysts.
Humira recorded $5.58 billion in sales during the fourth quarter — its last period without a rival in the US — narrowly beating Street estimates. The drug has already begun facing biosimilar competition in Europe, where it sold $573 million in the quarter.
Key Drugs
Two other anti-inflammatory drugs, Rinvoq and Skyrizi, are crucial to AbbVie’s future beyond Humira. The drugs had a mixed showing in the fourth quarter, with Rinvoq revenue of $770 million missing expectations while Skyrizi sales of $1.58 billion surpassed estimates.
Aesthetics product revenue decreased 8.5% from the year-ago quarter to $1.29 billion. AbbVie has said economic pressures like inflation are leading consumers to hold off on cosmetic treatments such as Juvederm fillers, which saw a worse-than-expected 25% drop in the period. AbbVie’s 2023 guidance assumes those challenges will persist this year.
AbbVie’s cancer drug Imbruvica continued to fall behind competitors. Sales decreased nearly 20% from the year-ago period to $1.1 billion, in line with estimates.
The company doesn’t expect 2024 profit to fall below $10.70 a share, Gonzalez said. AbbVie is well-positioned to pursue large deals and will search for ways to grow existing portfolios in immunology, oncology, neuroscience, eye care and aesthetics treatments, he said.
In the fourth quarter, AbbVie recorded adjusted earnings of $3.60 a share, topping the $3.53 consensus estimate. Sales of $15.1 billion were just shy of Wall Street’s expectations of $15.3 billion.
(Updates shares in first and third paragraphs)
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