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AbbVie (ABBV) Q1 Earnings Top, Competition Rises for Imbruvica

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AbbVie Inc. (ABBV - Free Report) reported earnings of $3.16 per share for the first quarter of 2022, beating the Zacks Consensus Estimate of $3.15 and exceeding the guided range of $3.10 to $3.14 per share. Earnings rose 9.3% year over year.

The company’s revenues of $13.54 billion slightly missed the Zacks Consensus Estimate of $13.55 billion. Sales rose 4.1% year over year on a reported basis and 5.4% on an operational basis. Sales were driven by Skyrizi, Rinvoq, Venclexta, Aesthetics and Neuroscience franchise, offset by lower sales of Imbruvica amid rising competition from newer therapies.

AbbVie lowered its adjusted EPS guidance for 2022 by 8 cents to reflect the cost incurred with the acquisition of rights to in-process R&D projects through R&D collaborations, licensing arrangements or other asset acquisitions and ceratin milestone payment made during the quarter.

Shares of AbbVie were down 4.6% in pre-market trading, likely on rising competitive pressure for Imbruvica and a lowered EPS guidance. AbbVie’s shares have gained 15.4% so far this year compared with the industry’s 5.1% increase.

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Quarter in Detail

In immunology, key drug Humira recorded a year-over-year sales decrease of 1.8% on an operational basis to $4.74 billion. Sales in the United States climbed 2.2% to $3.99 billion. However, Humira sales in the ex-U.S. markets were down 17.9% on an operational basis to $743 million. International sales were affected by the launch of several direct biosimilar drugs in Europe by other pharma companies, including Amgen (AMGN - Free Report) , Sandoz and Biogen (BIIB - Free Report) .

Amgen, Sandoz and Biogen were the first to start commercializing a Humira-biosimilar in Europe in 2018. Amgen, Sandoz and Biogen also received FDA approvals for Humira-biosimilar but commercialization is expected to start after the loss of exclusivity for Humira in 2023.

New immunology drugs, Skyrizi and Rinvoq registered sales of $940 million and $465 million, respectively, up 65.6% and 57.3% operationally year over year. In the previous quarter, Skyrizi and Rinvoq had recorded sales of $895 million and $517, respectively. The significant growth in sales can be attributed to the strong uptake.

AbbVie’s oncology/hematology (including Imbruvica and Venclexta) sales declined 0.6% on an operational basis to $1.65 billion in the quarter, driven by the strong growth of Venclexta sales, more than offset by lower U.S. sales of Imbruvica.

First-quarter net revenues from Imbruvica were $1.17 billion, down 7.4% year over year. AbbVie has developed the drug in partnership with Johnson & Johnson (JNJ - Free Report) . AbbVie shares international profits earned from Imbruvica with J&J.

U.S. sales of J&J-partnered Imbruvica grossed $874 million, down 12.4% from the year-ago figure. Increasing competition from newer therapies and lower new patient starts are likely to have hurt sales of the drug during the quarter. AbbVie’s share of profit from international sales of the J&J-partnered drug rose 11% to $299 million.

The company’s leukemia drug, Venclexta generated revenues of $473 million in the reported quarter, reflecting 21.1% year-over-year growth on an operational basis.

AbbVie’s aesthetics portfolio sales were up 22.5% on an operational basis to $1.37 billion on the back of robust demand for Botox Cosmetic and Juvederm. Sales of Botox cosmetics rose 36.6% on an operational basis to $641 million while Juvederm’s sales were up 30.9% operationally to $410 million.

Sales from the neuroscience portfolio increased 20.4% operationally to $1.49 billion, driven by Botox Therapeutic and Vraylar along with additional sales from Ubrelvy. While Botox Therapeutic sales rose 16.6% to $614 million, sales of Vraylar were up 23.4% to $427 million. AbbVie’s newly launched oral migraine drug, Ubrelvy, generated $138 million in revenues, compared with $183 million in the fourth quarter of 2021. Sales were up 70% operationally year over year.

Eye care portfolio sales declined 2.8% on an operational basis to $771 million. Sales of a key drug in the portfolio, Restasis, decreased 11.3% year over year to $246 million.

Adjusted SG&A expenses increased 4% to $2.85 billion while adjusted R&D expenses were $1.48 billion in the first quarter, declining 1.7% year over year. The adjusted operating margin represented 51.4% of sales.

2022 Guidance Lowered

AbbVie lowered its EPS guidance for 2022 to reflect the unfavorable impact of acquired IPR&D and milestones expenses incurred during the first quarter. The company now expects adjusted EPS to be in the range of $13.92-$14.12, compared with the previously guided range of $14.00-$14.20. The Zacks Consensus Estimate for current-year earnings per share is pegged at $14.11.

AbbVie Inc. Price, Consensus and EPS Surprise

AbbVie Inc. Price, Consensus and EPS Surprise

AbbVie Inc. price-consensus-eps-surprise-chart | AbbVie Inc. Quote

Zacks Rank

Currently, AbbVie is a Zacks Rank #3 (Hold) stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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