) reported second quarter 2013 earnings of 82 cents per share,
beating the Zacks Consensus Estimate of 79 cents. Revenues
increased 4.4% to $4.692 billion in the second quarter of 2013,
above the Zacks Consensus Estimate of $4.492 billion. Currency
movement negatively impacted revenues by 0.7%.
Including one-time items, second quarter 2013 earnings came in
at 66 cents per share, down 17.5%.
The Quarter in Detail
Key drug, Humira, recorded growth of 12.1% with revenues
coming in at $2.606 billion. U.S. sales increased 16% ($1.224
billion) due to strong performance in the dermatology and
gastroenterology segments. Revenues also benefited from the
global launch of Humira for the ulcerative colitis indication.
Ex- U.S. sales increased 8.8% to $1.382 billion. TriCor/Trilipix
revenues fell 65.6% to $107 million.
Other products that performed well included Synthroid (up
24.4% to $153 million), Creon (up 20.5% to $106 million), Zemplar
(up 12.6% to $107 million) and Duodopa (up 25.7% to $44
AbbVie said that adjusted SG&A was 27.9% of sales in the
second quarter - this reflects the company's investment in its
Adjusted R&D was 14.8% of second quarter 2013 sales,
reflecting the company's investment in its mid- and late-stage
pipeline as well its efforts to expand Humira's label.
AbbVie's pipeline represents significant potential - earlier
this year, the company had said that it is targeting 15
regulatory approvals between 2013 and 2017. The company's
late-stage pipeline includes several compounds or indications in
phase III development targeting therapeutic areas like hepatitis
C, immunology, multiple sclerosis and endometriosis.
Phase III results on the company's triple direct-acting
antivirals (DAAs) plus ribavirin regimen for the treatment of
hepatitis C virus (HCV) infection should start coming out later
Based on its strong performance in the first half of 2013,
AbbVie raised the lower end of its 2013 earnings outlook. The
company now expects earnings in the range of $3.07 to $3.13 per
share (old guidance: $3.03 to $3.13 per share). The Zacks
Consensus Estimate of $3.12 is towards the higher end of the
We believe AbbVie is poised for strong growth. Humira should
continue driving sales thanks to factors like additional
indications, increasing penetration, geographic expansion, and
share gains. New indications could boost peak sales potential for
Humira by another $1.5 billion.
2013 and 2014 represent a transition period for the company
which is facing generic competition for its lipid franchise -
TriCor, TriLipix and Niaspan.
AbbVie currently carries a Zacks Rank #3 (Hold). While we are
positive on AbbVie's strong late-stage pipeline, dividend yield
and growth strategy, we remain concerned about its dependence on
Humira. We believe AbbVie will continue pursuing in-licensing
deals and collaborations to boost its pipeline.
Companies that currently look attractive include
Johnson & Johnson
). While Actelion and Jazz are Zacks Rank #1 (Strong Buy) stocks,
Johnson & Johnson is a Zacks Rank #2 (Buy) stock.
ABBVIE INC (ABBV): Free Stock Analysis Report
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