Today's Must Read
AbbVie's (ABBV) Pipeline Solid, Skyrizi, Rinvoq Start Strong
Sanofi (SNY) Diabetes Sales Weak, Specialty Care Unit Strong
Wednesday, December 11, 2019
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Novartis (NVS), AbbVie (ABBV) and Sanofi (SNY). These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
Novartis’s shares have outperformed the Zacks Large-Cap Pharmaceuticals industry year to date (8.2% vs. 8.1%). The Zacks analyst believes that Novartis’ performance in the year so far has been stellar on key drugs like Cosentyx and Entresto, its contribution from Zolgensma, and the Xiidra acquisition.
The impending acquisition of The Medicines Company should broaden its portfolio. New launches like Piqray and Beovu should further propel performance in the upcoming quarters. A strong uptake is expected particularly from Beovu as it is the first FDA-approved anti-VEGF to offer greater fluid resolution compared to Eylea.
However, price erosion in the United States has adversely impacted the generic business. Recently, Novartis has restructured its business and spun off the eye-care unit, Alcon, to become a core drug-focused company. However, pipeline setbacks and generic competition for key drugs are concerns
Shares of AbbVie have gained 22.2% in the past three months against the Zacks Large-Cap Pharmaceuticals industry’s rise of 9.3%. The Zacks analyst believes that AbbVie’s Humira is performing well driven by strong demand trends amid new competition.
Imbruvica has multibillion-dollar potential. AbbVie has been successful in expanding approvals for its cancer drugs, Imbruvica and Venclexta. It also has an impressive late-stage pipeline. It gained approvals for two new drugs with significant potential, Skyrizi (risankizumab) and Rinvoq this year. Both are off to a strong start.
The acquisition of Allergan, if successful, should diversify AbbVie’s revenue base and accelerate its non-Humira business. Sales erosion due to direct biosimilar competition to Humira in international markets is a big headwind. Also, the decline in HCV sales is a concern.
Sanofi's shares have gained 11.2% over the past six months against the Zacks Large Cap Pharmaceuticals industry's rise of 5%. The Zacks analyst believes that Sanofi’s focus on streamlining operations and pursuing business development deals is encouraging.
The company’s Specialty Care segment is on a strong footing, particularly with regular label expansion of Dupixent. Dupixent is now annualizing at around €2 billion in sales after just around two years in the market and could prove to be key long-term driver. The performance of the Vaccines and Consumer Healthcare franchises also improved of late.
Sanofi’s R&D pipeline is strong and has delivered important results with several positive data read-outs and the achievement of regulatory milestones this year. However, headwinds include weak performance of the Diabetes unit, generic competition for many drugs and slower-than-expected uptake of core products like Praluent.
Other noteworthy reports we are featuring today include Southern (SO), Pioneer Natural Resources (PXD) and Aqua America (WTR).
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Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Preview reports. If you want an email notification each time Sheraz publishes a new article, please click here>>>