AbbVie Inc.
ABBV,
shares jumped about 6% Thursday as the pharmaceutical giant reported strong second-quarter sales of newer immunology drugs that helped cushioned the blow of lower-cost competition for its blockbuster arthritis drug Humira.
The stock on Thursday morning was on pace for its largest percentage gain since November 2020 after AbbVie raised its full-year outlook. The company now expects full-year 2023 adjusted earnings per share in the range of $10.90 to $11.10, versus previous guidance of $10.57 to $10.97.
Skyrizi and Rinvoq, two AbbVie immunology drugs widely seen as successors to Humira, both posted second-quarter sales that increased more than 50% compared with the year-earlier period and topped analyst expectations. Humira sales of $4.01 billion were down 25% from the year-earlier period but beat the FactSet consensus of $3.95 billion.
The impact of Humira biosimilar competition is playing out “slightly better than our planning assumptions,” AbbVie CEO Richard Gonzalez told analysts on a call Thursday morning. Humira has generated more than $200 billion in sales over the past 20 years but faced its first biosimilar competition at the start of this year.
AbbVie said on the call Thursday that it’s even benefiting indirectly from the weight-loss drug craze surrounding treatments like Novo Nordisk’s
NVO,
Ozempic. The company’s aesthetics business makes Botox and dermal fillers like Juvederm, and some people experiencing facial hollowing after rapid weight loss are seeking out such products, AbbVie senior vice president Carrie Strom said on the call. “Really anything that gets a consumer engaged in their appearance, including products like Ozempic, are a positive tailwind for the aesthetics business,” Strom said.
AbbVie posted net income of $2.02 billion, or $1.14 per share, after net income of $924 million, or $0.51 per share in the year-earlier period. Second quarter revenue totaled $13.87 billion, versus $14.58 billion a year earlier, ahead of the FactSet consensus of $13.54 billion. Adjusted earnings per share came to $2.91, versus $3.37 a year earlier, beating the FactSet consensus of $2.83.
The strong results for Skyrizi and Rinvoq “may continue to provide some assurance” to investors who are questioning how AbbVie will continue to build its revenue base after Humira’s loss of market exclusivity, BMO Capital Markets analyst Evan David Seigerman wrote in a note Thursday.
But some investors have already bailed on the stock. The Baron Health Care Fund
BHCFX,
sold its position in AbbVie during the second quarter, manager Neal Kaufman said in a recent letter to shareholders, “due to our less optimistic view of the company’s pipeline and long-term growth profile.”
AbbVie shares are down 7.3% in the year to date, while the S&P 500
SPX,
is up 18.9%.
This post was originally published on Market Watch
