AbbVie, Inc.’s ABBV third-quarter results are likely to reflect the impact of the recovering trend in drug sales, similar to the second quarter. The majority of the company’s drugs, especially the aesthetics franchise, witnessed a recovery in the second quarter. However, in certain disease areas like CLL and HCV, there continued to be a residual impact of the pandemic. The impact of the resurgence of COVID-19 cases since June-end remains to be seen.
The new immunology drugs — Skyrizi and Rinvoq— are likely to have contributed to top-line growth in the third quarter of 2021. The drugs showed robust sequential revenue growth in the first two quarters of 2021. These two drugs are likely to have partially offset some loss of sales of the company’s flagship drug, Humira, to generics in international markets. The Zacks Consensus Estimate for Skyrizi and Rinvoq sales is pegged at $771 million and $438 million, respectively.
Humira sales in the United States are likely to have maintained their uptrend during the third quarter on the back of continued demand for the drug. However, strong biosimilar competition in international markets, especially Europe, is likely to have partially offset U.S. sales growth. Also, the impact of the resurgence of COVID-19 cases on sales of Humira remains to be seen as it is a physician-administered drug.
Please note that Humira is approved for several inflammatory indications. It is also a major revenue-generating drug for AbbVie and brought more than 35% of the company’s revenues in the first half of 2021.
The Zacks Consensus Estimate for Humira stands at $4.77 billion. The Zacks Consensus Estimate for U.S. sales is pegged at $4.5 billion while that for international sales is $750 million.
AbbVie’s stock has gained 2.2% so far this year compared with an increase of 11.6% for the industry.
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U.S. sales growth of key oncology medicine, Imbruvica was hurt by lower new patient starts in CLL due to the pandemic and increased competition from newer therapies in the second quarter. We expect third-quarter sales growth to be muted for the physician-administered drug amid the resurgence of COVID-19 cases. However, strong demand in the international market is likely to have aided sales of the drug during the third quarter. The drug is marketed in partnership with J&J JNJ globally. The Zacks Consensus Estimate for the drug is pegged at $1.32 billion, comprising sales of $1.16 billion in the United States and $284 million of international profit sharing with J&J.
Sales of another leukemia drug, Venclexta, is likely to have gained from continued share gains across all approved indications similar to the past few quarters. However, lower new patient utilization may have impacted third-quarter performance as Venclexta is a hospital-based treatment. AbbVie markets Venclexta in partnership with Roche RHHBY. The Zacks Consensus Estimate for the drug is pegged at $480 million.
Sales of AbbVie’s new Hepatitis C drug, Mavyret, started recovering from the pandemic impact during the second quarter. The recovery trend is likely to have continued in the third quarter, boosting sales of the drug. However, the pace of the recovery remains to be seen amid rising COVID-19 cases. The Zacks Consensus Estimate for Mavyret stands at $477 million.
Sales of the company’s neuroscience franchise are expected to have been driven by Vraylar Botox and the new oral migraine drug, Ubrelvy during the third quarter.
The rapid recovery in the aesthetics franchise, led by Botox Cosmetic and Juvederm, is likely to have boosted the top line in the soon-to-be reported quarter. The Zacks Consensus Estimate for the aesthetic franchise stands at $1.24 billion and $1.5 billion for the neuroscience franchise.
AbbVie Inc. Price and EPS Surprise
Zacks Rank & Stock to Consider
AbbVie currently carries a Zacks Rank #4 (Sell).
A better-ranked company from the biotech sector is Vertex Pharmaceuticals VRTX, carrying a Zacks Rank #2 (Buy). Earnings estimates have risen from $12.37 to $12.43 for 2021 and from $13.13 to $13.16 for 2022, over the past 30 days.
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