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ABBV or BMY: Which Biopharma Giant Has Better Prospects for Now?
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Key Takeaways
ABBV's Skyrizi and Rinvoq are driving growth, offsetting losses from Humira's patent expiration.
ABBV gained new drug approvals and expanded its oncology and neuroscience portfolios via acquisitions.
BMY faces revenue pressure from legacy drugs despite new launches like Cobenfy and Opdualag growth.
AbbVie, Inc. (ABBV - Free Report) and Bristol Myers Squibb (BMY - Free Report) are leading drugmakers with broad and diverse portfolios and a global footprint.
AbbVie is a global, diversified biopharmaceutical company with a dominant position across key therapeutic areas, including immunology, neuroscience, oncology, aesthetics and eye care.
On the other hand, Bristol Myers is focused on discovering, developing and delivering transformational drugs for oncology, hematology, immunology, cardiovascular, neuroscience and other diseases.
Both of these biopharma/biotech giants have strong footholds in their targeted businesses, delivering consistent returns to shareholders. In such a scenario, choosing one stock over the other can be tricky. Let us delve into their fundamentals, potential growth prospects, challenges and valuation levels to make a prudent choice.
The Case for ABBV
AbbVie’s flagship drug Humira has lost patent protection both in the United States and Europe. Biosimilar competition significantly eroded the drug’s sales in 2024, and the decline is expected to be sharper in 2025.
Nonetheless, the acquisition of Botox maker Allergan for $63 billion in May 2020 has bolstered the product portfolio and lowered its dependence on Humira.
ABBV’s immunology drugs Skyrizi and Rinvoq have put up a stellar performance and positioned it well for long-term growth. These drugs are witnessing strong uptake across their approved indications, especially in the popular inflammatory bowel disease space, which includes two conditions, ulcerative colitis and Crohn’s disease. Strong sales of these drugs have enabled AbbVie to offset the decline in sales of the blockbuster drug Humira.
AbbVie has also built a strong oncology franchise with drugs like Imbruvica and Venclexta. Label expansion over the past couple of years have significantly expanded the eligible patient population for Venclexta. This, in turn, is boosting sales of the drug.
In October 2024, AbbVie gained approval for Vyalev, a transformative therapy for treating advanced Parkinson’s disease. Approval of new drugs further expands ABBV’s portfolio.
AbbVie has several promising R&D programs with the potential to drive long-term growth. This includes next-generation approaches in immunology, a focus on bispecifics, ADCs, as well as innovative therapies for neuropsychiatric and neurodegenerative disorders.
The company has also been active on the M&A front. It acquired ImmunoGen, which added antibody-drug conjugate, Elahere and neuroscience drugmaker Cerevel Therapeutics in 2024.
As of March 31, 2025, AbbVie had $64.5 billion in long-term debt and $5.4 billion in short-term debt/obligations on its balance sheet. Cash and cash equivalents totaled approximately $5.2 billion.
However, increasing competitive pressure on Imbruvica and slowing sales of its aesthetics franchise are major headwinds, along with declining Humira sales.
The Case for BMY
BMY’s Growth Portfolio, comprising drugs like Reblozyl, Breyanzi, Camzyos and Opdualag, has stabilized its revenue base amid generic competition for its legacy drugs. Thalassemia drug Reblozyl has put up a stellar performance since its approval, posting strong growth in the United States and international markets. The drug is expected to contribute significantly in the coming decade.
Sales of its oncology drug, Opdualag, have also been robust, fueling the top line. Strong growth in the U.S. market and encouraging uptake in newly launched markets have boosted sales. Strong momentum in Camzyos should further drive growth.
Opdivo continues to maintain momentum on consistent label expansions. The FDA approval of Opdivo Qvantig (nivolumab and hyaluronidase-nvhy) injection for subcutaneous use should help extend the impact of its immuno-oncology franchise to patients into the next decade. Other drugs like Zeposia and Krazati should also contribute to top-line growth.
The company has made strategic acquisitions to broaden its portfolio and drive top-line growth. The recent FDA approval for xanomeline and trospium chloride (formerly KarXT), an oral medication for the treatment of schizophrenia in adults, was approved under the brand name Cobenfy. The approval of Cobenfy for schizophrenia broadens BMY’s portfolio and validates the acquisition of Karuna Therapeutics.
While the newer drugs boost sales, generic competition for legacy drugs, which account for the majority of total revenues, is a significant headwind and will affect top-line growth in the near term. Legacy Portfolio revenues declined 20% in the first quarter due to continued generic impact on Revlimid, Pomalyst, Sprycel and Abraxane, as well as the U.S. Medicare Part D redesign effect.
Nonetheless, BMY is looking to boost its bottom line through cost-cutting initiatives.
While BMY’s strategy of acquiring companies with promising drugs and candidates is encouraging, this has resulted in substantial debt to finance these acquisitions. As of March 31, 2025, the company had cash and equivalents of $12.1 billion and a long-term debt of $46.1 billion.
A Look at Estimates: ABBV vs BMY
The Zacks Consensus Estimate for ABBV’s 2025 sales implies a year-over-year increase of 6.6%, and that for earnings per share (EPS) suggests an improvement of 20.65%. However, EPS estimates for 2025 have moved south in the past 60 days.
ABBV’s Estimate Movement
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for BMY’s 2025 sales implies a year-over-year decrease of 4.13%, while that for EPS suggests an increase of 487.83%. The extraordinary EPS growth rate is attributed to an extremely low EPS figure in 2024 due to acquisition expenses.
EPS estimates for both 2025 and 2026 have moved south in the past 60 days.
BMY’s Estimate Movement
Image Source: Zacks Investment Research
Price Performance and Valuation of ABBV and BMY
From a price-performance perspective, ABBV has fetched better returns than BMY so far this year. Shares of ABBV have gained 11.8%, while those of BMY have lost 11.2%. The large-cap pharma industry has gained 1.6% in the said period.
Image Source: Zacks Investment Research
From a valuation standpoint, we use the P/E ratio of the large-cap pharma industry to compare these companies. Going by the same, ABBV is slightly more expensive than BMY. ABBV’s shares currently trade at 14.76X forward earnings, higher than 7.60X for BMY. The large-cap pharma industry currently trades at 15.16X forward earnings.
Image Source: Zacks Investment Research
Both ABBV and BMY have an attractive dividend yield. This is a strong positive for investors. However, BMY's dividend yield of 5.20% is higher than ABBV’s 3.4%.
Which Stock Is a Better Pick for Now?
Large pharma/biotech companies are generally considered safe havens for investors interested in this sector.
ABBV has a strong and diverse portfolio. Immunology drugs Skyrizi and Rinvoq maintain momentum for the company. However, declining Humira sales, increasing competitive pressure on Imbruvica and slowing sales of its aesthetics franchise are major headwinds for the company.
BMY’s efforts to revive the top line in the face of generic challenges for key drugs are commendable. Approval of new drugs and label expansion of key drugs should generate incremental revenues for the company. However, we believe there is still time before the efforts reap a harvest for the company. The outlook for 2025 indicates challenges as of now.
While both companies deal with patent cliffs, we believe ABBV is a better pick at present, primarily due to the diversity and strength of its portfolio.
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ABBV or BMY: Which Biopharma Giant Has Better Prospects for Now?
Key Takeaways
AbbVie, Inc. (ABBV - Free Report) and Bristol Myers Squibb (BMY - Free Report) are leading drugmakers with broad and diverse portfolios and a global footprint.
AbbVie is a global, diversified biopharmaceutical company with a dominant position across key therapeutic areas, including immunology, neuroscience, oncology, aesthetics and eye care.
On the other hand, Bristol Myers is focused on discovering, developing and delivering transformational drugs for oncology, hematology, immunology, cardiovascular, neuroscience and other diseases.
Both of these biopharma/biotech giants have strong footholds in their targeted businesses, delivering consistent returns to shareholders. In such a scenario, choosing one stock over the other can be tricky. Let us delve into their fundamentals, potential growth prospects, challenges and valuation levels to make a prudent choice.
The Case for ABBV
AbbVie’s flagship drug Humira has lost patent protection both in the United States and Europe. Biosimilar competition significantly eroded the drug’s sales in 2024, and the decline is expected to be sharper in 2025.
Nonetheless, the acquisition of Botox maker Allergan for $63 billion in May 2020 has bolstered the product portfolio and lowered its dependence on Humira.
ABBV’s immunology drugs Skyrizi and Rinvoq have put up a stellar performance and positioned it well for long-term growth. These drugs are witnessing strong uptake across their approved indications, especially in the popular inflammatory bowel disease space, which includes two conditions, ulcerative colitis and Crohn’s disease. Strong sales of these drugs have enabled AbbVie to offset the decline in sales of the blockbuster drug Humira.
AbbVie has also built a strong oncology franchise with drugs like Imbruvica and Venclexta. Label expansion over the past couple of years have significantly expanded the eligible patient population for Venclexta. This, in turn, is boosting sales of the drug.
In October 2024, AbbVie gained approval for Vyalev, a transformative therapy for treating advanced Parkinson’s disease. Approval of new drugs further expands ABBV’s portfolio.
AbbVie has several promising R&D programs with the potential to drive long-term growth. This includes next-generation approaches in immunology, a focus on bispecifics, ADCs, as well as innovative therapies for neuropsychiatric and neurodegenerative disorders.
The company has also been active on the M&A front. It acquired ImmunoGen, which added antibody-drug conjugate, Elahere and neuroscience drugmaker Cerevel Therapeutics in 2024.
As of March 31, 2025, AbbVie had $64.5 billion in long-term debt and $5.4 billion in short-term debt/obligations on its balance sheet. Cash and cash equivalents totaled approximately $5.2 billion.
However, increasing competitive pressure on Imbruvica and slowing sales of its aesthetics franchise are major headwinds, along with declining Humira sales.
The Case for BMY
BMY’s Growth Portfolio, comprising drugs like Reblozyl, Breyanzi, Camzyos and Opdualag, has stabilized its revenue base amid generic competition for its legacy drugs. Thalassemia drug Reblozyl has put up a stellar performance since its approval, posting strong growth in the United States and international markets. The drug is expected to contribute significantly in the coming decade.
Sales of its oncology drug, Opdualag, have also been robust, fueling the top line. Strong growth in the U.S. market and encouraging uptake in newly launched markets have boosted sales. Strong momentum in Camzyos should further drive growth.
Opdivo continues to maintain momentum on consistent label expansions. The FDA approval of Opdivo Qvantig (nivolumab and hyaluronidase-nvhy) injection for subcutaneous use should help extend the impact of its immuno-oncology franchise to patients into the next decade. Other drugs like Zeposia and Krazati should also contribute to top-line growth.
The company has made strategic acquisitions to broaden its portfolio and drive top-line growth. The recent FDA approval for xanomeline and trospium chloride (formerly KarXT), an oral medication for the treatment of schizophrenia in adults, was approved under the brand name Cobenfy. The approval of Cobenfy for schizophrenia broadens BMY’s portfolio and validates the acquisition of Karuna Therapeutics.
While the newer drugs boost sales, generic competition for legacy drugs, which account for the majority of total revenues, is a significant headwind and will affect top-line growth in the near term. Legacy Portfolio revenues declined 20% in the first quarter due to continued generic impact on Revlimid, Pomalyst, Sprycel and Abraxane, as well as the U.S. Medicare Part D redesign effect.
Nonetheless, BMY is looking to boost its bottom line through cost-cutting initiatives.
While BMY’s strategy of acquiring companies with promising drugs and candidates is encouraging, this has resulted in substantial debt to finance these acquisitions. As of March 31, 2025, the company had cash and equivalents of $12.1 billion and a long-term debt of $46.1 billion.
A Look at Estimates: ABBV vs BMY
The Zacks Consensus Estimate for ABBV’s 2025 sales implies a year-over-year increase of 6.6%, and that for earnings per share (EPS) suggests an improvement of 20.65%. However, EPS estimates for 2025 have moved south in the past 60 days.
ABBV’s Estimate Movement
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for BMY’s 2025 sales implies a year-over-year decrease of 4.13%, while that for EPS suggests an increase of 487.83%. The extraordinary EPS growth rate is attributed to an extremely low EPS figure in 2024 due to acquisition expenses.
EPS estimates for both 2025 and 2026 have moved south in the past 60 days.
BMY’s Estimate Movement
Image Source: Zacks Investment Research
Price Performance and Valuation of ABBV and BMY
From a price-performance perspective, ABBV has fetched better returns than BMY so far this year. Shares of ABBV have gained 11.8%, while those of BMY have lost 11.2%. The large-cap pharma industry has gained 1.6% in the said period.
Image Source: Zacks Investment Research
From a valuation standpoint, we use the P/E ratio of the large-cap pharma industry to compare these companies. Going by the same, ABBV is slightly more expensive than BMY. ABBV’s shares currently trade at 14.76X forward earnings, higher than 7.60X for BMY. The large-cap pharma industry currently trades at 15.16X forward earnings.
Image Source: Zacks Investment Research
Both ABBV and BMY have an attractive dividend yield. This is a strong positive for investors. However, BMY's dividend yield of 5.20% is higher than ABBV’s 3.4%.
Which Stock Is a Better Pick for Now?
Large pharma/biotech companies are generally considered safe havens for investors interested in this sector.
However, with both ABBV and BMY stocks currently carrying a Zacks Rank #3 (Hold), choosing one over the other is a complex task. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ABBV has a strong and diverse portfolio. Immunology drugs Skyrizi and Rinvoq maintain momentum for the company. However, declining Humira sales, increasing competitive pressure on Imbruvica and slowing sales of its aesthetics franchise are major headwinds for the company.
BMY’s efforts to revive the top line in the face of generic challenges for key drugs are commendable. Approval of new drugs and label expansion of key drugs should generate incremental revenues for the company. However, we believe there is still time before the efforts reap a harvest for the company. The outlook for 2025 indicates challenges as of now.
While both companies deal with patent cliffs, we believe ABBV is a better pick at present, primarily due to the diversity and strength of its portfolio.