AbbVie’s (ABBV), stock has performed well in this past year, as the price surged up to a new record of $200. This year it has risen by over 32%, beating the S&P and Nasdaq 100 indices. The stock also performed better than VanEck Pharmaceuticals ETF (PPH), whose value has increased by 16% in the past year.
Humira sales fall, but we’re doing better
AbbVie is a worldwide juggernaut thanks to Humira. This blockbuster drug has sold billions in recent decades. It is used to treat autoimmune conditions and inflammations such as rheumatoid arthritis, ankylosing Spondylitis and Cron’s disease.
Biosimilars are also subject to a period of patent expiration, similar to other drugs.
AbbVie has used different strategies over the years to defer the expiry date, which was last year. This opened the industry up to competition.
After the expiration of a patent, pharmaceutical companies usually see their sales plummet. Humira revenues fell to $2.8 billion in the latest financial report.
However, most pharma firms are aware of the approaching patent expiration date and begin preparing. Most of these companies do this by increasing their R&D budgets in order to discover the next great thing.
Some invest, on the other hand, in acquisitions. This is especially true in biotechnology. AbbVie made several big acquisitions over the last few years. Allergan was the most significant acquisition, which gave it access to Botox, among other drugs, in exchange for a deal worth $63 billion.
AbbVie had acquired Stemcentrx, Pharmacyclics and Stemcentrx in transactions valued at $5.8 and $21 billion. The buyouts allowed it to expand its oncology division. In a $10 billion transaction, it also acquired Immunogen.
AbbVie revenue continues rising
AbbVie has continued to grow its business in recent years as it prepares for the future after Humiar. In the 12 months ending in June, its annual revenue grew from $33.2 billion to $55 billion. Net income dropped, though, from $11.8 billion to $5.3 in TTM.
Humira revenue dropped almost 30%, but AbbVie revenue increased by nearly 4%.
The growth in revenue was driven by the immunology division, which saw its revenue rise by 2,3% to $6.9 Billion. Oncology revenues rose 10.5%, while neuroscience and aesthetics revenue grew by 14.7% each.
Skyrizi, and Rinvoq could be as popular as Humira.
Skyrizi treats plaque psoriasis – a condition that affects more than 8 million Americans. Data shows the drug to be superior than top competitors such as Otezla or Stelara, since patients began seeing results after only 16 weeks.
It also cures Crohn’s better than Stelara. The drug has also a superior safety record when compared with most of its rivals.
AbbVie therefore believes Skyrizi will bring in $17 billion over the next 3 years. The company is expected to surpass Humira’s $21 billion peak revenue by 2030. Skyrizi’s last quarter saw a revenue of over $2.7billion, an increase of 44.8% from 2023.
Rinvoq is another potential catalyst. It treats diseases such as rheumatoid arthritis and psoriatic, atopic and Crohn’s. Rinvoq’s last financial report showed that it had generated over $1.4 billion, which is a growth of 55% on an annualised basis. Management expects the rate to continue increasing in the future.
The deal between FutureGreen Biopharmaceutical and AbbVie is the next major catalyst for AbbVie. The company was acquired for $150m and $1.56bn in additional milestone payments.
FutureGreen, a company that is active in the TL1A antigen industry, has been in the news a great deal recently. Merck, for example, acquired Prometheus at a cost of $10.8 billion while Roche paid $7.1 billion to acquire Telavant.
These developments will ensure AbbVie is a profitable business in the future. Analysts expect its revenue to rise from $55.65 billion in 2024 to $58.61 million by 2025.
AbbVie stock price forecast
AbbVie stock by TradingView
Weekly chart of ABBV shows a bullish trend in the share price for a very long time. The red channel shows an upward trend. The stock is also above both the 100-week and 50-week Exponential Moving Averages, while maintaining a positive Relative Strength Index.
Stocks have also shown a bullish pattern in the form of a bullish pattern.
Analysts at Cantor-Fitzgerald predicted that the stock would continue to rise as the bulls aim for the next significant resistance level of $200. If the stock breaks above this level, it will likely lead to further gains. The next important point is at $225.
ICD first published the AbbVie Stock Analysis: Rinvoq, Skyrizi and other big drivers.
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