ABBV
Abbvie INC
NYSE
10-Q: AbbVie Reports Q3 2024 Results, Driven by Strong Performance in Key Growth Areas
Sentiment:
Quarterly Report
4 November 2024 2:19 PM
AbbVie's Q3 2024 results show a 3% increase in net revenue and diluted earnings per share of $0.88, impacted by recent acquisitions and ongoing market dynamics.
Worse than expected
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
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.
Summary
- AbbVie reported a 3% increase in net revenues to $14.46 billion for the third quarter of 2024, and a 3% increase to $41.232 billion for the nine months ended September 30, 2024.
- Diluted earnings per share were $0.88 for the quarter and $2.41 for the nine months ended September 30, 2024.
- The company's operating earnings were $3.831 billion for the quarter and $10.627 billion for the nine months ended September 30, 2024.
- The results were impacted by $4.9 billion in amortization of intangible assets, $3.4 billion for the change in fair value of contingent consideration liabilities, $894 million of acquisition and integration expenses, and $585 million for litigation matters for the nine months ended September 30, 2024.
- The company completed the acquisitions of ImmunoGen on February 12, 2024, and Cerevel Therapeutics on August 1, 2024, which have been included in the financial results.
Sentiment
Score: 5
Explanation: The sentiment is neutral to slightly negative. While there are positive aspects like strong growth in some key products and strategic acquisitions, the significant impact of Humira biosimilar competition, high expenses, and a delay in a key product approval temper the overall outlook.
Positives
- Skyrizi, Rinvoq, Venclexta, Botox Therapeutic, Vraylar, Ubrelvy and Qulipta all showed strong revenue growth.
- The company successfully completed the acquisitions of ImmunoGen and Cerevel Therapeutics, expanding its pipeline and market presence.
- AbbVie's board of directors increased the quarterly dividend by 5.8%, demonstrating confidence in the company's financial health.
- The company has a robust pipeline with approximately 90 compounds, devices or indications in development.
Negatives
- Global Humira sales decreased by 37% for the three months and 33% for the nine months ended September 30, 2024 due to biosimilar competition.
- Imbruvica revenues decreased by 9% for the three months and 7% for the nine months ended September 30, 2024 due to decreased demand and lower market share.
- Juvederm Collection net revenues decreased by 17% for the three months and 11% for the nine months ended September 30, 2024 due to decreased consumer demand.
- Operating cash flows decreased due to the timing of working capital, higher contingent consideration payments and decreased results from operations driven by acquisition-related cash expenses.
- The company incurred significant expenses related to amortization of intangible assets, changes in fair value of contingent consideration liabilities, acquisition and integration costs, and litigation matters.
Risks
- The company faces ongoing challenges from biosimilar competition for Humira.
- The company's financial results are subject to fluctuations due to changes in fair value of contingent consideration liabilities.
- The company's future performance is dependent on the success of its pipeline and new product launches.
- The company is subject to various legal proceedings and investigations, which could result in significant liabilities.
- The company's ability to generate cash flows from operations, issue debt or enter into financing arrangements on acceptable terms could be adversely affected by various factors.
Future Outlook
AbbVie anticipates several regulatory submissions and data readouts from key clinical trials in the next 12 months and expects multiple mid-stage programs to transition into late-stage programs.
Management Comments
- AbbVie's mission is to discover and develop innovative medicines and products that solve serious health issues today and address the medical challenges of tomorrow while achieving top-tier financial performance through outstanding execution.
- AbbVie intends to execute its strategy and advance its mission in a number of ways, including: (i) maximizing the benefits of a diversified revenue base with multiple long-term growth drivers; (ii) leveraging AbbVie's commercial strength and international infrastructure across therapeutic areas and ensuring strong commercial execution of new product launches; (iii) continuing to invest in and expand its pipeline in support of opportunities in immunology, oncology, aesthetics, neuroscience and eye care as well as continued investment in key on-market products; (iv) generating substantial operating cash flows to support investment in innovative research and development, and return cash to shareholders via a strong and growing dividend while also continuing to repay debt.
Industry Context
The report reflects the ongoing trends in the pharmaceutical industry, including the impact of biosimilar competition on established brands like Humira, the importance of a diversified product portfolio, and the strategic focus on acquisitions to drive growth and innovation. The company's focus on immunology, oncology, aesthetics, neuroscience, and eye care aligns with key areas of unmet medical need and market opportunity.
Comparison to Industry Standards
- AbbVie's performance in key growth areas like Skyrizi and Rinvoq is strong compared to industry averages for new product launches.
- The decline in Humira sales due to biosimilar competition is consistent with industry trends for products losing exclusivity.
- The company's investment in R&D and acquisitions is in line with strategies employed by other large pharmaceutical companies to maintain a competitive edge.
- The company's gross margin of 70% for the nine months ended September 30, 2024 is within the range of other large pharmaceutical companies.
- The company's effective tax rate of 28% for the nine months ended September 30, 2024 is impacted by foreign operations and business development activities, which is common in the pharmaceutical industry.
Stakeholder Impact
- Shareholders will benefit from the increased dividend and potential for future growth.
- Employees may be impacted by restructuring plans and integration activities.
- Customers will benefit from new product launches and expanded treatment options.
- Suppliers may be impacted by changes in the company's supply chain.
- Creditors will be impacted by the company's debt issuance and repayment activities.
Next Steps
- AbbVie anticipates several regulatory submissions and data readouts from key clinical trials in the next 12 months.
- The company expects multiple mid-stage programs to transition into late-stage programs in the next 12 months.
- The company will continue to integrate the operations of ImmunoGen and Cerevel Therapeutics.
- The company will continue to monitor and manage the impact of biosimilar competition on Humira sales.
Legal Proceedings
- AbbVie is subject to various claims, legal proceedings and investigations regarding product liability, intellectual property, commercial, securities and other matters.
- Lawsuits are pending against AbbVie and others generally alleging that the 2005 patent litigation settlement involving Niaspan violated federal and state antitrust laws.
- Lawsuits are pending against Allergan and several other manufacturers generally alleging that they improperly promoted and sold prescription opioid products.
- A federal securities lawsuit is pending against AbbVie, its chief executive officer and former chief financial officer, alleging that reasons stated for Humira sales growth in financial filings between 2013 and 2018 were misleading.
- A putative class action lawsuit is pending against AbbVie on behalf of Humira patients who paid for Humira based on its list price.
- Lawsuits are pending against various Allergan entities in the United States and other countries in which plaintiffs generally allege that they developed, or may develop, breast implant-associated anaplastic large cell lymphoma (ALCL) or other injuries from Allergan's Biocell textured breast implants.
- AbbVie Inc. is seeking to enforce patent rights relating to venetoclax, upadacitinib and ubrogepant.
Related Party Transactions
- AbbVie has ongoing transactions with Janssen Biotech, Inc. for the joint development and commercialization of Imbruvica.
- AbbVie has ongoing transactions with Genentech, Inc. for the joint development and commercialization of Venclexta.
Key Dates
- December 2011: Pharmacyclics, a wholly-owned subsidiary of AbbVie, entered into a worldwide collaboration and license agreement with Janssen Biotech, Inc. for the joint development and commercialization of Imbruvica.
- 2007: AbbVie and Genentech, Inc. executed a collaboration and license agreement to jointly research, develop and commercialize human therapeutic products containing BCL-2 inhibitors, including Venclexta.
- January 31, 2023: Humira lost exclusivity in the United States.
- February 16, 2023: AbbVie's board of directors authorized a $5.0 billion increase to the existing stock repurchase authorization.
- March 2023: AbbVie entered into an amended and restated five-year revolving credit facility.
- February 12, 2024: AbbVie completed the acquisition of ImmunoGen, Inc.
- August 1, 2024: AbbVie completed the acquisition of Cerevel Therapeutics Holdings, Inc.
- July 1, 2024: Robert A. Michael succeeded Richard A. Gonzalez as AbbVie's chief executive officer.
- October 28, 2024: AbbVie announced that it entered into a definitive agreement to acquire Aliada Therapeutics, Inc.
- October 30, 2024: The board of directors declared an increase in the company's quarterly dividend from $1.55 per share to $1.64 per share.
Keywords
AbbVie, Pharmaceuticals, Biotechnology, Immunology, Oncology, Aesthetics, Neuroscience, Eye Care, Humira, Skyrizi, Rinvoq, Imbruvica, Venclexta, Botox, Juvederm, Vraylar, Ubrelvy, Qulipta, Elahere, Epkinly, Acquisition, Financial Results, Clinical Trials
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.
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
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.
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.
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.
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.
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.
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.
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
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.
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.
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
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.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.