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AbbVie Inc.

AbbVie's Guidance and Outlook

Overall Financial Performance

  • 2024 Revenue Guidance: AbbVie has raised its full-year revenue guidance to approximately $55.5 billion, an increase of $500 million from the previous guidance. This includes a $300 million raise for Skyrizi, a $100 million raise for Rinvoq, and a $100 million raise for Venclexta. However, Aesthetics revenue guidance has been reduced by $200 million due to slower-than-expected near-term market growth, particularly in the U.S. and China.

  • EPS Guidance: AbbVie raised its full-year adjusted earnings per share (EPS) guidance by $0.15, now expecting between $10.90 and $10.94. This guidance does not include an estimate for acquired IP R&D expense beyond the third quarter.

  • 2025 Outlook: AbbVie expects to return to robust revenue growth in 2025, despite headwinds from the Medicare Part D redesign and continued Humira erosion. The company characterizes "robust growth" as above industry average growth, which is expected to be in the low single digits. The company expects earnings growth in line with revenue growth, with operating margin expansion offset by full-year interest expense associated with the financing for Cerevel and ImmunoGen acquisitions.

Key Product-Specific Guidance

  1. Skyrizi

    • Global Sales: AbbVie now expects Skyrizi global sales of approximately $11.5 billion, an increase of $500 million due to strong performance across all approved indications, particularly in Crohn's disease and ulcerative colitis.
    • IBD Indications: Skyrizi is on track to add more than $1 billion of incremental sales growth in inflammatory bowel disease (IBD) in 2024. The company anticipates rapid access in the U.S. following the launch in ulcerative colitis.
    • Long-Term Potential: By 2027, Skyrizi is expected to achieve more than $17 billion in global sales, reflecting continued share capture in psoriasis and strong uptake in IBD.

  2. Rinvoq

    • Global Sales: AbbVie now expects Rinvoq total revenue of $5.8 billion, an increase of $100 million, reflecting robust uptake in IBD.
    • New Indications: Rinvoq is making excellent progress with late-stage development in 5 additional indications, expected to launch in the second half of this decade, contributing to a significant revenue inflection.
    • Long-Term Potential: By 2027, Rinvoq is expected to achieve more than $10 billion in global sales, with continued market growth and share momentum across its approved indications.

  3. Humira

    • Global Sales: Humira global sales are now expected to be $7.4 billion in the U.S., a decrease of $400 million due to more Humira molecule volume moving to other novel mechanisms, including Skyrizi and Rinvoq.
    • Tail Revenues: The company expects the Humira tail to start emerging in 2025 or 2026, but it will be modest, with a subsegment of patients staying on Humira even in an interchangeable world.

  4. Aesthetics

    • Global Sales: AbbVie now expects Aesthetics global revenue of $5.3 billion, a decrease of $200 million, mainly due to lower Juvederm volume, which continues to be impacted by challenging economic conditions in key markets like the U.S. and China.
    • Long-Term Growth: Despite near-term challenges, the company remains confident in the long-term growth outlook for Aesthetics, targeting more than $9 billion in sales by the end of the decade. This is supported by low market penetration rates and the introduction of innovative treatments like BoNT/E and new indications for Botox.

  5. Neuroscience

    • Global Sales: AbbVie expects Neuroscience revenue of $8.9 billion, representing growth of more than 15%, driven by Vraylar sales of $3.4 billion, Botox Therapeutic sales of $3.2 billion, and oral CGRP revenue of $1.6 billion.
    • Pipeline Catalysts: The company is excited about the potential of Tavapadon for Parkinson's disease and emraclidine for schizophrenia, with positive Phase III results and upcoming data readouts.

  6. Oncology

    • Global Sales: AbbVie expects Oncology sales of $5.7 billion, including Imbruvica revenue of $2.9 billion and Venclexta sales of $2.4 billion.
    • Pipeline: The company is advancing its solid tumor pipeline with Teliso-V and ABBV-400 (next-generation c-Met ADC), and expects to submit regulatory applications for ABBV-383 (BCMA-CD3 bispecific) in multiple myeloma.

Key Strategic Initiatives

  1. Ex-Humira Growth Platform:

    • AbbVie’s ex-Humira growth platform, which covers more than 80% of the company’s total sales, is expected to deliver reported growth of nearly 18% in 2024, significantly outpacing the overall company’s growth rate.
    • The company expects this platform to continue driving strong double-digit revenue growth into the next decade.

  2. Pipeline Expansion:

    • AbbVie has been actively investing in external innovation, particularly in immunology, oncology, and neuroscience. The company has executed nearly a dozen early-stage deals this year, including the acquisition of Cerevel Therapeutics and ImmunoGen.
    • The company is focused on adding depth to its pipeline, particularly in early-stage deals that can drive growth in the next decade.

  3. Capital Allocation:

    • AbbVie remains committed to its capital allocation priorities, including a strong and growing quarterly dividend (increased by 5.8% to $1.64 per share) and debt repayment.
    • The company expects to achieve a net leverage ratio of 2x by the end of 2026 and has the financial wherewithal to pursue additional business development opportunities.

Challenges and Mitigation Strategies

  1. Medicare Part D Redesign:

    • The Part D redesign will be a headwind in 2025, impacting several of AbbVie’s products. However, the company expects this impact to be mitigated by strong volume growth and the fact that products subject to negotiation will not have the Part D cost-share impact in subsequent years.

  2. Economic Headwinds:

    • The Aesthetics business, particularly in the U.S. and China, has been impacted by economic headwinds. However, the company remains confident in the long-term growth potential of this business, supported by low market penetration rates and the introduction of new products.

  3. Humira Biosimilar Competition:

    • The company expects Humira erosion to continue, but it is increasingly confident that the shift from Humira to Skyrizi and Rinvoq is a net positive for the company, as these products offer superior efficacy and safety profiles.
    • The company is also preparing for the potential impact of interchangeable biosimilars in the U.S. market, but believes that Skyrizi and Rinvoq will continue to capture significant market share.

Conclusion

AbbVie remains confident in its ability to deliver robust growth in 2025 and beyond, driven by the strong performance of its ex-Humira growth platform, particularly Skyrizi and Rinvoq. The company is well-positioned to navigate near-term challenges, including the Part D redesign and economic headwinds, while continuing to invest in its pipeline for long-term success.

Last updated on 01/14/2025 05:14 AM

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