AbbVie's fourth-quarter sales top estimates; raises earnings guidance for 2018

AbbVie said Friday that fourth-quarter sales increased 14.1 percent year-over-year to $7.7 billion, topping analyst estimates of $7.5 billion, with growth led by Humira and Imbruvica. Three-month revenue from Humira, which AbbVie expects will hit nearly $21 billion in 2020, saw sales climb 14 percent in the fourth quarter to $4.9 billion, ahead of forecasts of $4.8 billion. 

The company noted that quarterly sales of Imbruvica surged 38.7 percent to $708 million, roughly in line with expectations. Analysts suggested that expanding the use of the blood cancer therapy, which is co-marketed with Johnson & Johnson, could be a focus in 2018. Meanwhile, AbbVie posted a profit of $52 million, down from $1.4 billion in the same period of 2016, mainly due to $1.1 billion in income tax charges logged during the quarter.

In other financial results, AbbVie said hepatitis C virus (HCV) drug products generated $510 million in the quarter, up 63.4 percent from the year-ago period. Revenue from Synagis was 4.4 percent higher at $282 million, with quarterly sales of Creon jumping 10.6 percent versus the year-ago period to $235 million. Lupron rose by 2.2 percent to $224 million, while Synthroid contributed $205 million in sales. 

In addition, AbbVie reported that AndroGel revenue fell 19.6 percent year-over-year to $140 million, while sales of Kaletra declined 14.3 percent to $113 million. Further, Duodopa sales were up 27.6 percent to $100 million, while revenue from Sevoflurane decreased by 1.5 percent to $99 million. 

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CEO Richard Gonzalez said "2017 reflects another year of top-tier performance, demonstrating the strong momentum in our business." Overall sales last year rose 10.4 percent to $28.2 billion, with net income of $5.3 billion, compared to just under $6 billion in 2016. Meanwhile, full-year revenue from Humira and Imbruvica climbed 14.6 percent and 40.5 percent, respectively, to $18.4 billion and $2.6 billion. Sales of HCV products were 16.3 percent lower in 2017, compared with the year before, at $1.3 billion.

AbbVie also raised its financial guidance for 2018, predicting earnings per share in the range of $7.33 to $7.43, up from a prior estimate of between $6.37 and $6.57, whereas analysts had projected earnings of $6.66 per share. The company said the uplift reflects "the impact of US tax reform and stronger operating performance," adding that the tax overhaul will cut its effective tax rate to 9 percent for 2018, below the 20 percent that analysts had expected, according to Leerink analyst Geoffrey Porges. However, AbbVie anticipates that its tax rate will rise up to 13 percent over the next five years because of increased US income and investments.

Jefferies analyst Jeffrey Holford remarked "we expected an upward 2018 guidance revision, but not of this magnitude." Gonzalez said the company's higher guidance "underscores our confidence in our ability to continue to deliver industry-leading performance." He added that AbbVie is "poised to launch a number of differentiated products over the next 12 to 18 months that will fuel significant growth in the coming years."

Meanwhile, the drugmaker anticipates $32 billion in revenue this year, versus forecasts of about $31 billion. AbbVie also said that over the next five years, it plans to invest about $2.5 billion in capital projects in the US, and "is currently evaluating additional expansion of its US facilities."


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