ABBV
Abbvie INC
NYSE
8-K: AbbVie Reports Mixed Full-Year and Q4 2023 Results, Announces Strategic Acquisitions
Sentiment:
Quarterly Report
2 February 2024 7:51 AM
AbbVie's full-year 2023 results show a decrease in GAAP EPS and revenue, impacted by Humira biosimilar competition, but the company is making strategic acquisitions and raising long-term outlook for key products.
Worse than expected
The full-year GAAP diluted EPS decreased by 59.0%, indicating worse than expected profitability.
The overall net revenues decreased by 6.4% on a reported basis, showing worse than expected sales performance.
Humira revenues experienced a substantial decline due to biosimilar competition, which was worse than expected.
Summary
- AbbVie reported full-year 2023 net revenues of $54.318 billion, a decrease of 6.4% on a reported basis.
- Full-year diluted EPS was $2.72 on a GAAP basis, a decrease of 59.0%, and adjusted diluted EPS was $11.11, a decrease of 19.3%.
- The company's immunology portfolio saw a 9.6% decrease in revenue due to Humira biosimilar competition, with Humira revenues declining to $14.404 billion.
- Skyrizi and Rinvoq revenues showed strong growth, with Skyrizi reaching $7.763 billion and Rinvoq at $3.969 billion.
- The neuroscience portfolio experienced an 18.2% increase in revenue, driven by Botox Therapeutic and Vraylar.
- AbbVie announced definitive agreements to acquire ImmunoGen for approximately $10.1 billion and Cerevel Therapeutics for approximately $8.7 billion.
- The company provided 2024 adjusted diluted EPS guidance of $11.05 to $11.25, including a $0.32 per share dilutive impact from the acquisitions.
- AbbVie reaffirmed its expectation for high single-digit compound annual revenue growth through 2029 and raised its 2027 combined sales outlook for Skyrizi and Rinvoq to more than $27 billion.
- Peak sales outlook for Ubrelvy and Qulipta were raised to more than $3 billion combined.
Sentiment
Score: 6
Explanation: The sentiment is mixed. While there are positive aspects like the acquisitions and growth in some product lines, the significant decline in EPS and Humira revenue temper the overall outlook. The company is taking steps to address future growth, but the current results are not overwhelmingly positive.
Positives
- Skyrizi and Rinvoq demonstrated strong revenue growth, offsetting some of the Humira decline.
- The neuroscience portfolio showed significant growth, driven by key products like Botox Therapeutic and Vraylar.
- The acquisitions of ImmunoGen and Cerevel Therapeutics are expected to strengthen AbbVie's oncology and neuroscience pipelines.
- AbbVie reaffirmed its long-term growth outlook and raised sales expectations for key products.
- The company is actively investing in R&D and bolstering its pipeline.
Negatives
- Full-year GAAP diluted EPS decreased significantly by 59.0% due to various factors including acquired IPR&D and milestones expense.
- Humira revenues experienced a substantial decline due to biosimilar competition.
- The oncology portfolio saw a decrease in revenue of 10.1% on a reported basis.
- The company's overall net revenues decreased by 6.4% on a reported basis.
- The acquisitions will have a dilutive impact on 2024 EPS.
Risks
- The ongoing impact of Humira biosimilar competition poses a significant risk to revenue.
- The integration of ImmunoGen and Cerevel Therapeutics may present challenges.
- The company faces risks related to intellectual property, competition, and regulatory changes.
- There is a risk that the acquisitions may not be consummated on the anticipated timeframe or at all.
- The costs to consummate the acquisitions could be greater than expected.
Future Outlook
AbbVie expects modest operational revenue growth in 2024, followed by a return to robust growth in 2025 and a high single-digit CAGR through 2029. The company also raised its long-term outlook for Skyrizi, Rinvoq, Ubrelvy and Qulipta.
Management Comments
- 2023 was another outstanding year, marked by strong operational execution and significant overperformance from our non-Humira growth platform.
- During the year we meaningfully increased R&D investment and bolstered our pipeline with the proposed ImmunoGen and Cerevel Therapeutics acquisitions.
- 2024 is an exciting year for AbbVie, as we are well positioned to fully absorb Humira erosion and achieve modest operational revenue growth, followed by a return to robust growth in 2025 and a high single-digit CAGR through the end of the decade.
Industry Context
The results reflect the ongoing impact of biosimilar competition on established pharmaceutical products like Humira. The acquisitions of ImmunoGen and Cerevel Therapeutics demonstrate a strategic move to diversify and strengthen AbbVie's pipeline in key therapeutic areas, aligning with industry trends of companies seeking growth through acquisitions and innovation.
Comparison to Industry Standards
- The decline in Humira revenue is consistent with the expected impact of biosimilar competition, a trend seen across the pharmaceutical industry for blockbuster drugs losing patent protection.
- The growth of Skyrizi and Rinvoq is a positive sign, indicating AbbVie's ability to develop and commercialize new products to offset revenue losses from older drugs, similar to strategies employed by companies like Novartis and Pfizer.
- The acquisitions of ImmunoGen and Cerevel Therapeutics are comparable to other large pharmaceutical companies acquiring biotech firms to enhance their pipelines, such as Merck's acquisition of Acceleron Pharma.
- AbbVie's long-term growth outlook and increased sales expectations for key products are similar to the strategies of other major pharmaceutical companies aiming for sustained growth through innovation and strategic acquisitions.
Stakeholder Impact
- Shareholders may be concerned about the decrease in EPS and revenue, but encouraged by the strategic acquisitions and long-term growth outlook.
- Employees may experience changes due to the acquisitions and integration processes.
- Customers will benefit from the development of new and innovative therapies.
- Suppliers may see changes in demand based on the company's product portfolio.
- Creditors will monitor the company's financial performance and debt levels.
Next Steps
- AbbVie will focus on integrating ImmunoGen and Cerevel Therapeutics.
- The company will continue to advance its clinical programs, including lutikizumab in HS.
- AbbVie will present data from the LUMINOSITY trial at a future medical meeting.
- The company will discuss with global health authorities the potential to support an accelerated approval for telisotuzumab-vedotin.
- AbbVie will continue to develop and commercialize new products to offset revenue losses from older drugs.
Key Dates
- February 2, 2024: Date of the 8-K filing and press release announcing Q4 and full-year 2023 financial results.
- Mid-2024: Anticipated closing of the ImmunoGen and Cerevel Therapeutics acquisitions.
Keywords
AbbVie, Humira, Skyrizi, Rinvoq, Immunology, Oncology, Neuroscience, Aesthetics, Acquisition, ImmunoGen, Cerevel Therapeutics, EPS, Revenue, Biosimilar, Pharmaceuticals
ABBV
Abbvie INC
NYSE
Sector: TBD
Filings with Classifications
Better than expected
9 May 2025 1:24 PM
Quarterly Report
- The company reported an 8% increase in net revenues on a reported basis and a 10% increase on a constant currency basis, indicating strong growth.
- Operating earnings reached $3.7 billion, with diluted earnings per share at $0.72, reflecting improved profitability.
- Key growth drivers included Skyrizi and Rinvoq in immunology, and Vraylar and Botox Therapeutic in neuroscience, demonstrating successful product performance.
Better than expected
25 April 2025 7:48 AM
Quarterly Report
- AbbVie's first-quarter results exceeded expectations, leading to an increase in the company's full-year adjusted diluted EPS guidance.
Worse than expected
3 April 2025 4:13 PM
8-K Filing
- The company's full-year adjusted diluted EPS guidance has been lowered from $12.12 $12.32 to $11.99 $12.19 due to the $248 million IPR&D expense in Q1 2025.
Better than expected
24 March 2025 4:28 PM
Proxy Statement
- AbbVie's 2024 results exceeded expectations with strong revenue growth and a robust R&D pipeline, indicating better-than-expected performance.
Capital raise
26 February 2025 5:04 PM
Debt Offering Announcement
- AbbVie completed an underwritten public offering of $4 billion in senior notes.
- The offering was registered under the Securities Act of 1933.
- The proceeds from the notes offering are likely to be used for general corporate purposes, including refinancing existing debt, funding acquisitions, and investing in research and development.
Capital raise
19 February 2025 9:22 AM
Debt Offering Announcement
- AbbVie is issuing $4 billion in senior notes.
- The offering includes notes due in 2028, 2030, 2035, and 2055.
- The company expects to receive approximately $3.98 billion in net proceeds.
Better than expected
18 February 2025 5:00 PM
SEC Form 4
- The vesting of performance-based awards suggests that the company exceeded its performance targets, leading to the release of these shares to the executive.
Worse than expected
14 February 2025 1:17 PM
Annual Report (Form 10-K)
- Humira sales declined by 37% globally due to biosimilar competition, which is worse than expected.
Delay expected
14 February 2025 1:17 PM
Annual Report (Form 10-K)
- AbbVie received a Complete Response Letter (CRL) from the FDA for the New Drug Application (NDA) for ABBV-951 for the treatment of motor fluctuations in adults with advanced Parkinson's disease.
Worse than expected
31 January 2025 7:42 AM
Quarterly Report
- The full-year diluted EPS decreased by 12.1% on a GAAP basis and 8.9% on an adjusted basis.
- The company experienced a diluted loss per share in the fourth quarter on a GAAP basis.
- The fourth-quarter results included a significant unfavorable impact from acquired IPR&D and milestones expense.
- The company recorded a non-cash after-tax intangible asset impairment charge of $3.5 billion related to emraclidine.
Worse than expected
10 January 2025 8:31 AM
8-K Filing
- The document details a $3.5 billion impairment charge due to failed clinical trials, indicating worse than expected results for the emraclidine program.
Worse than expected
6 January 2025 4:02 PM
Earnings Guidance Update
- The updated guidance includes a $1.6 billion charge for acquired IPR&D and milestones expense, which significantly reduces both Q4 and full-year adjusted diluted EPS compared to previous guidance.
Worse than expected
4 November 2024 2:19 PM
Quarterly Report
- The company's diluted earnings per share of $0.88 for the quarter and $2.41 for the nine months ended September 30, 2024 were negatively impacted by significant expenses related to amortization of intangible assets, changes in fair value of contingent consideration liabilities, acquisition and integration costs, and litigation matters.
- The company's operating cash flows decreased compared to the prior year due to the timing of working capital, higher contingent consideration payments and decreased results from operations driven by acquisition-related cash expenses.
Delay expected
4 November 2024 2:19 PM
Quarterly Report
- AbbVie received a Complete Response Letter from the FDA for the New Drug Application for ABBV-951 due to observations identified during inspection of a third-party manufacturer.
Better than expected
30 October 2024 7:43 AM
Quarterly Report
- The company raised its full-year adjusted diluted EPS guidance, indicating better than expected performance.
- The company's adjusted diluted EPS of $3.00 was better than the previous year's $2.95.
- The company's net revenues increased by 3.8 percent on a reported basis, indicating better than expected performance.
Worse than expected
3 October 2024 4:07 PM
Earnings Guidance Update
- The $82 million expense for acquired IPR&D and milestones will negatively impact both GAAP and adjusted non-GAAP diluted earnings per share by $0.04.
- The full-year and third quarter adjusted diluted EPS guidance ranges have been lowered to reflect this expense.
Capital raise
7 August 2024 3:00 PM
Quarterly Report
- AbbVie issued $15 billion in senior notes to finance the acquisitions of ImmunoGen and Cerevel Therapeutics.
- The company also borrowed and repaid $5.0 billion under a term loan credit agreement in connection with these acquisitions.
Worse than expected
7 August 2024 3:00 PM
Quarterly Report
- The company's earnings per share were negatively impacted by acquisition-related costs and amortization of intangible assets.
- Humira sales declined significantly due to biosimilar competition, which was worse than expected.
- Operating cash flows decreased compared to the prior year due to working capital timing and acquisition-related expenses.
Delay expected
7 August 2024 3:00 PM
Quarterly Report
- AbbVie received a Complete Response Letter from the FDA for ABBV-951 due to observations identified during inspection of a third-party manufacturer, delaying the potential approval of the drug.
Delay expected
25 July 2024 7:41 AM
Quarterly Report
- AbbVie received a Complete Response Letter (CRL) from the FDA for the New Drug Application (NDA) for ABBV-951, citing observations identified during inspection of a third-party manufacturer, which will delay the launch of the product.
Better than expected
25 July 2024 7:41 AM
Quarterly Report
- The company's second-quarter results exceeded expectations, driven by strong performance in its ex-Humira portfolio.
- AbbVie raised its full-year adjusted diluted EPS guidance, indicating better than previously anticipated financial performance.
Worse than expected
3 July 2024 2:07 PM
Earnings Guidance Update
- The company's earnings guidance for both the full year and the second quarter has been lowered due to a significant $937 million IPR&D expense.
Delay expected
3 May 2024 11:04 AM
Quarterly Report
- The company made a decision to revise the research and development plan for AGN-151607, a novel investigational neurotoxin, which contributed to a delay in the estimated timing of regulatory approval.
Capital raise
3 May 2024 11:04 AM
Quarterly Report
- AbbVie issued $15 billion in senior notes to finance the acquisition of ImmunoGen and the proposed acquisition of Cerevel Therapeutics.
- The company borrowed and repaid $5.0 billion under a term loan credit agreement in February 2024.
Better than expected
3 May 2024 11:04 AM
Quarterly Report
- The diluted earnings per share significantly increased to $0.77 from $0.13 year-over-year, indicating better than expected profitability.
- Net earnings attributable to AbbVie Inc. were $1.369 billion, a substantial increase from $239 million in the first quarter of 2023, showing better than expected results.
Better than expected
26 April 2024 7:43 AM
Quarterly Report
- The company raised its full-year adjusted diluted EPS guidance, indicating better than expected future performance.
- First quarter results were well ahead of expectations, driven by excellent performance from the ex-Humira growth platform.
Worse than expected
3 April 2024 4:06 PM
Earnings Guidance Update
- The company's earnings per share guidance has been lowered due to a $164 million expense related to acquired IPR&D and milestones.
Capital raise
26 February 2024 5:08 PM
Debt Offering Announcement
- AbbVie is raising $15 billion through the issuance of senior notes.
- The notes are being sold to underwriters in a registered public offering.
- The proceeds will be used for specific purposes including acquisitions and debt repayment.
Worse than expected
12 February 2024 7:49 AM
Merger Announcement
- The acquisition is expected to be dilutive to AbbVie's EPS in 2024, with a $0.42 per share impact for the full year and $0.04 per share in the first quarter.
Worse than expected
2 February 2024 7:51 AM
Quarterly Report
- The full-year GAAP diluted EPS decreased by 59.0%, indicating worse than expected profitability.
- The overall net revenues decreased by 6.4% on a reported basis, showing worse than expected sales performance.
- Humira revenues experienced a substantial decline due to biosimilar competition, which was worse than expected.
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