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AbbVie Inc. (ABBV - Free Report) reported adjusted earnings of $2.79 per share for fourth-quarter 2023, beating the Zacks Consensus Estimate of $2.76. The reported earnings also exceeded the guidance of $2.72-$2.76. However, earnings declined 22.5% year over year.
ABBV’s revenues of $14.30 billion beat the Zacks Consensus Estimate of $14.05 billion. Sales declined 5.4% year over year, both on a reported basis and an operational basis. The downside was caused by lower sales of Humira and Imbruvica, which was partially offset by the rise in product sales of key drugs like Rinvoq, Skyrizi, Vraylar, Ubrelvy and Qulipta.
All growth rates mentioned below are on a year-on-year basis and at constant exchange rates (CER).
Quarter in Detail
In immunology, AbbVie’s flagship drug, Humira, recorded a year-over-year sales decline of 40.7% to $3.30 billion on an operational basis. Sales in the United States declined 45.3% to $2.74 billion, while ex-U.S. market sales were down 1.0% on an operating basis to $564 million. The drug’s sales beatthe Zacks Consensus Estimate and our model estimates pegged at $3.18 billion and $3.19 billion, respectively.
This substantial decline in Humira sales was due to the drug’s recent loss of exclusivity in the United States. Last year, Amgen (AMGN - Free Report) launched the first Humira biosimilar in the United States, called Amjevita.
Like Amgen, several other companies, such as Boehringer Ingelheim, Coherus BioSciences and Sandoz (SDZNY - Free Report) , started marketing their own Humira biosimilars last year. Sandoz markets its Humira biosimilar under the trade name Hyrimoz. Like Amgen and Sandoz, more generic drugmakers are planning to launch their own Humira biosimilars. These are significantly eroding sales, which are likely to persist in the upcoming quarters. The drug lost its exclusivity in ex-U.S. territories following the launch of generics in 2018.
Net revenues from Rinvoq in the fourth quarter were $1.26 billion, up 62.8% on an operational basis year over year. The upside can be attributed to label expansions to the drug to include new patient populations in recent quarters. Rinvoq sales beat the Zacks Consensus Estimate and our model estimates of $1.19 billion and $1.15 billion, respectively.
Net revenues recorded from Skyrizi were $2.39 billion, up 51.6% on an operational basis year over year. This uptick in sales is due to label expansions to the drug to include new patient populations in recent quarters. Though Skyrizi sales beat our model estimates of $2.38 billion, it missed the Zacks Consensus Estimate of $2.41 billion.
Sales from the neuroscience portfolio increased 22.4% on an operational basis to $2.09 billion, driven by higher sales of the depression drug Vraylar and migraine drugs Ubrelvy and Qulipta. Neuroscience sales figures missed the Zacks Consensus Estimate and our model estimate, both of which were pegged at $2.11 billion.
While Botox Therapeutic sales rose 6.7% to $776 million, sales of Vraylar increased 39.8% to $789 million. Sales of AbbVie’s oral migraine drug Ubrelvy were $234 million, up 18.9% year over year.
The recently launched Qulipta generated $114 million in product revenues compared with $132 million in third-quarter 2023.
AbbVie’s oncology/hematology sales declined 7.6% on an operational basis to $1.51 billion in the quarter, as growth of Venclexta sales was more than offset by lower sales of Imbruvica. The oncology/hematology sales figure beat the Zacks Consensus Estimate of $1.44 billion and our model estimate of $1.43 billion.
Fourth-quarter net revenues from Imbruvica were $903 million, down 19.0% year over year. AbbVie markets the drug in partnership with Johnson & Johnson (JNJ - Free Report) . The company shares international profits earned from Imbruvica with J&J.
U.S. sales of J&J-partnered Imbruvica grossed $683 million, down 18.6% from the year-ago figure. Sales of the J&J-partnered Imbruvica declined amid rising competition from novel oral treatments in the United States. AbbVie’s share of profit from the international sales of the J&J-partnered drug declined 20.0% to $220 million.
The company recorded sales worth $17 million from the recently launched lymphoma drug Epkinly/Tepkinly, which is marketed in partnership with Genmab. The company shares U.S. profits earned from Epkinly with Genmab. The company’s share of profit from U.S. revenues of the drug was $12 million.
AbbVie’s aesthetics portfolio sales were up 6.9% on an operational basis to $1.37 billion due to rising product sales. Sales of Botox Cosmetic sales rose 12.3% on an operating basis to $718 million, while Juvederm sales rose 3.8% to $334 million.
Eye care portfolio sales declined 1.1% on an operational basis to $585 million. Sales of Ozurdex, a key drug in the portfolio, rose 11.3% year over year to $118 million.
Cost Discussion
Adjusted SG&A expenses rose 12.4% to $3.54 billion, while adjusted R&D expenses were $1.92 billion in the fourth quarter, up 10.4% year over year. The adjusted operating margin contributed 43.8% to sales.
Full-Year 2023 Results
AbbVie reported revenues of $54.32 billion, down 5.9% year over year. The company’s adjusted earnings for 2022 were $11.11 per share, down 19.3% from the year-ago period’s levels.
Financial Outlook
For 2024
AbbVie issued earnings per share (EPS) guidance for 2024. The company expects adjusted EPS in the range of $11.05-$11.25. This guided range includes a $0.32 per share dilutive impact related to the company’s proposed acquisitions of ImmunoGen and Cerevel Therapeutics, which are expected to be completed by mid-2024. The Zacks Consensus Estimate for 2024 earnings stands at $11.22 per share.
Shares of AbbVie were up 0.8% in pre-market trading on Feb 2, likely due to the encouraging guidance. In the past year, the stock has gained 15.4% compared with the industry’s 22.2% rise.
Image Source: Zacks Investment Research
Beyond 2024
Management also reaffirmed its expectations for a high single-digit compound annual revenue growth rate through 2029. For calculation purposes, this forecast assumes 2024 as the base year.
The company also hiked its 2027 forecast for combined Skyrizi and Rinvoq sales. It now expects to record combined revenues of more than $27 billion, up $6 billion over its previously issued forecast.
AbbVie also raised its long-term outlook for recently launched migraine drugs Ubrelvy and Qulipta. Management now expects peak sales guidance of more than $3 billion from the combined sales of migraine drugs. This marks an increase of around $1 billion to the previous guidance for peak revenues of more than $1 billion for each asset.
Image: Shutterstock
AbbVie (ABBV) Q4 Earnings Beat, Raises Sales View for Key Drugs
AbbVie Inc. (ABBV - Free Report) reported adjusted earnings of $2.79 per share for fourth-quarter 2023, beating the Zacks Consensus Estimate of $2.76. The reported earnings also exceeded the guidance of $2.72-$2.76. However, earnings declined 22.5% year over year.
ABBV’s revenues of $14.30 billion beat the Zacks Consensus Estimate of $14.05 billion. Sales declined 5.4% year over year, both on a reported basis and an operational basis. The downside was caused by lower sales of Humira and Imbruvica, which was partially offset by the rise in product sales of key drugs like Rinvoq, Skyrizi, Vraylar, Ubrelvy and Qulipta.
All growth rates mentioned below are on a year-on-year basis and at constant exchange rates (CER).
Quarter in Detail
In immunology, AbbVie’s flagship drug, Humira, recorded a year-over-year sales decline of 40.7% to $3.30 billion on an operational basis. Sales in the United States declined 45.3% to $2.74 billion, while ex-U.S. market sales were down 1.0% on an operating basis to $564 million. The drug’s sales beatthe Zacks Consensus Estimate and our model estimates pegged at $3.18 billion and $3.19 billion, respectively.
This substantial decline in Humira sales was due to the drug’s recent loss of exclusivity in the United States. Last year, Amgen (AMGN - Free Report) launched the first Humira biosimilar in the United States, called Amjevita.
Like Amgen, several other companies, such as Boehringer Ingelheim, Coherus BioSciences and Sandoz (SDZNY - Free Report) , started marketing their own Humira biosimilars last year. Sandoz markets its Humira biosimilar under the trade name Hyrimoz. Like Amgen and Sandoz, more generic drugmakers are planning to launch their own Humira biosimilars. These are significantly eroding sales, which are likely to persist in the upcoming quarters. The drug lost its exclusivity in ex-U.S. territories following the launch of generics in 2018.
Net revenues from Rinvoq in the fourth quarter were $1.26 billion, up 62.8% on an operational basis year over year. The upside can be attributed to label expansions to the drug to include new patient populations in recent quarters. Rinvoq sales beat the Zacks Consensus Estimate and our model estimates of $1.19 billion and $1.15 billion, respectively.
Net revenues recorded from Skyrizi were $2.39 billion, up 51.6% on an operational basis year over year. This uptick in sales is due to label expansions to the drug to include new patient populations in recent quarters. Though Skyrizi sales beat our model estimates of $2.38 billion, it missed the Zacks Consensus Estimate of $2.41 billion.
Sales from the neuroscience portfolio increased 22.4% on an operational basis to $2.09 billion, driven by higher sales of the depression drug Vraylar and migraine drugs Ubrelvy and Qulipta. Neuroscience sales figures missed the Zacks Consensus Estimate and our model estimate, both of which were pegged at $2.11 billion.
While Botox Therapeutic sales rose 6.7% to $776 million, sales of Vraylar increased 39.8% to $789 million. Sales of AbbVie’s oral migraine drug Ubrelvy were $234 million, up 18.9% year over year.
The recently launched Qulipta generated $114 million in product revenues compared with $132 million in third-quarter 2023.
AbbVie’s oncology/hematology sales declined 7.6% on an operational basis to $1.51 billion in the quarter, as growth of Venclexta sales was more than offset by lower sales of Imbruvica. The oncology/hematology sales figure beat the Zacks Consensus Estimate of $1.44 billion and our model estimate of $1.43 billion.
Fourth-quarter net revenues from Imbruvica were $903 million, down 19.0% year over year. AbbVie markets the drug in partnership with Johnson & Johnson (JNJ - Free Report) . The company shares international profits earned from Imbruvica with J&J.
U.S. sales of J&J-partnered Imbruvica grossed $683 million, down 18.6% from the year-ago figure. Sales of the J&J-partnered Imbruvica declined amid rising competition from novel oral treatments in the United States. AbbVie’s share of profit from the international sales of the J&J-partnered drug declined 20.0% to $220 million.
The company recorded sales worth $17 million from the recently launched lymphoma drug Epkinly/Tepkinly, which is marketed in partnership with Genmab. The company shares U.S. profits earned from Epkinly with Genmab. The company’s share of profit from U.S. revenues of the drug was $12 million.
AbbVie’s aesthetics portfolio sales were up 6.9% on an operational basis to $1.37 billion due to rising product sales. Sales of Botox Cosmetic sales rose 12.3% on an operating basis to $718 million, while Juvederm sales rose 3.8% to $334 million.
Eye care portfolio sales declined 1.1% on an operational basis to $585 million. Sales of Ozurdex, a key drug in the portfolio, rose 11.3% year over year to $118 million.
Cost Discussion
Adjusted SG&A expenses rose 12.4% to $3.54 billion, while adjusted R&D expenses were $1.92 billion in the fourth quarter, up 10.4% year over year. The adjusted operating margin contributed 43.8% to sales.
Full-Year 2023 Results
AbbVie reported revenues of $54.32 billion, down 5.9% year over year. The company’s adjusted earnings for 2022 were $11.11 per share, down 19.3% from the year-ago period’s levels.
Financial Outlook
For 2024
AbbVie issued earnings per share (EPS) guidance for 2024. The company expects adjusted EPS in the range of $11.05-$11.25. This guided range includes a $0.32 per share dilutive impact related to the company’s proposed acquisitions of ImmunoGen and Cerevel Therapeutics, which are expected to be completed by mid-2024. The Zacks Consensus Estimate for 2024 earnings stands at $11.22 per share.
Shares of AbbVie were up 0.8% in pre-market trading on Feb 2, likely due to the encouraging guidance. In the past year, the stock has gained 15.4% compared with the industry’s 22.2% rise.
Image Source: Zacks Investment Research
Beyond 2024
Management also reaffirmed its expectations for a high single-digit compound annual revenue growth rate through 2029. For calculation purposes, this forecast assumes 2024 as the base year.
The company also hiked its 2027 forecast for combined Skyrizi and Rinvoq sales. It now expects to record combined revenues of more than $27 billion, up $6 billion over its previously issued forecast.
AbbVie also raised its long-term outlook for recently launched migraine drugs Ubrelvy and Qulipta. Management now expects peak sales guidance of more than $3 billion from the combined sales of migraine drugs. This marks an increase of around $1 billion to the previous guidance for peak revenues of more than $1 billion for each asset.
AbbVie Inc. Price
AbbVie Inc. price | AbbVie Inc. Quote
Zacks Rank
AbbVie currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.