On April 27, 2023 AbbVie (NYSE:ABBV) reported financial results for the first quarter ended March 31, 2023 (Press release, AbbVie, APR 27, 2023, View Source [SID1234630585]).
"This year is off to an excellent start, with first-quarter revenues and EPS ahead of our expectations, driven by strong commercial execution across all areas of our diversified portfolio," said Richard A. Gonzalez, chairman and chief executive officer, AbbVie. "These balanced results give us confidence to increase our full-year guidance and we see numerous opportunities for key assets to drive compelling long-term growth."
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Note: "Operational" comparisons are presented at constant currency rates that reflect comparative local currency net revenues at the prior year’s foreign exchange rates. 1
First-Quarter Results
•Worldwide net revenues were $12.225 billion, a decrease of 9.7 percent on a reported basis, or 8.3 percent on an operational basis.
•Global net revenues from the immunology portfolio were $5.587 billion, a decrease of 9.0 percent on a reported basis, or 7.8 percent on an operational basis.
◦Global Humira net revenues of $3.541 billion decreased 25.2 percent on a reported basis, or 24.3 percent on an operational basis. U.S. Humira net revenues were $2.948 billion, a decrease of 26.1 percent. Internationally, Humira net revenues were $593 million, a decrease of 20.3 percent on a reported basis, or 14.8 percent on an operational basis.
◦Global Skyrizi net revenues were $1.360 billion, an increase of 44.7 percent on a reported basis, or 46.3 percent on an operational basis.
◦Global Rinvoq net revenues were $686 million, an increase of 47.5 percent on a reported basis, or 51.2 percent on an operational basis.
•Global net revenues from the hematologic oncology portfolio were $1.416 billion, a decrease of 14.0 percent on a reported basis, or 12.9 percent on an operational basis.
◦Global Imbruvica net revenues were $878 million, a decrease of 25.2 percent, with U.S. net revenues of $638 million and international profit sharing of $240 million.
◦Global Venclexta net revenues were $538 million, an increase of 13.7 percent on a reported basis, or 17.5 percent on an operational basis.
•Global net revenues from the neuroscience portfolio were $1.695 billion, an increase of 13.9 percent on a reported basis, or 15.0 percent on an operational basis.
◦Global Botox Therapeutic net revenues were $719 million, an increase of 17.1 percent on a reported basis, or 18.7 percent on an operational basis.
◦Global Vraylar net revenues were $561 million, an increase of 31.3 percent.
◦Global Ubrelvy net revenues were $152 million, an increase of 10.0 percent.
•Global net revenues from the aesthetics portfolio were $1.300 billion, a decrease of 5.4 percent on a reported basis, or 2.0 percent on an operational basis.
◦Global Botox Cosmetic net revenues were $659 million, an increase of 2.9 percent on a reported basis, or 5.8 percent on an operational basis.
◦Global Juvederm net revenues were $355 million, a decrease of 13.4 percent on a reported basis, or 7.4 percent on an operational basis.
•On a GAAP basis, the gross margin ratio in the first quarter was 67.4 percent. The adjusted gross margin ratio was 84.2 percent.
•On a GAAP basis, selling, general and administrative (SG&A) expense was 24.9 percent of net revenues. The adjusted SG&A expense was 24.4 percent of net revenues.
•On a GAAP basis, research and development (R&D) expense was 18.8 percent of net revenues. The adjusted R&D expense was 13.6 percent of net revenues, reflecting funding actions supporting all stages of our pipeline.
•Acquired IPR&D and milestones expense was 1.2 percent of net revenues.
•On a GAAP basis, the operating margin in the first quarter was 22.6 percent. The adjusted operating margin was 45.0 percent.
•Net interest expense was $454 million.
•On a GAAP basis, the tax rate in the quarter was 49.3 percent. The adjusted tax rate was 13.7 percent.
•Diluted EPS in the first quarter was $0.13 on a GAAP basis. Adjusted diluted EPS, excluding specified items, was $2.46. These results include an unfavorable impact of $0.08 per share related to acquired IPR&D and milestones expense.
Note: "Operational" comparisons are presented at constant currency rates that reflect comparative local currency net revenues at the prior year’s foreign exchange rates.
2
Recent Events
•AbbVie announced the European Commission (EC) approved Rinvoq (upadacitinib, 45 mg induction dose, 15 mg and 30 mg maintenance doses) as the first oral Janus Kinase (JAK) inhibitor for the treatment of adult patients with moderately to severely active Crohn’s disease (CD) who have had an inadequate response, lost response or were intolerant to either conventional therapy or a biologic agent. The approval is based on results from three studies in which Rinvoq achieved the co-primary endpoints of clinical remission and endoscopic response, compared to placebo, as both induction and maintenance therapy. This is the seventh approved indication for Rinvoq in the European Union (EU).
•AbbVie announced positive top-line results from INSPIRE, a Phase 3 induction study, showing Skyrizi (risankizumab, 1200 mg intravenous (IV), at weeks 0, 4 and 8) met the primary endpoint of clinical remission at week 12, as well as all secondary endpoints in adult patients with moderately to severely active ulcerative colitis (UC). Safety results in this study were consistent with the known safety profile of Skyrizi, with no new safety risks observed. Skyrizi is part of a collaboration between Boehringer Ingelheim and AbbVie, with AbbVie leading development and commercialization globally.
•AbbVie announced positive top-line results from a Phase 2 study of Rinvoq (30 mg, once daily), given alone or as combination therapy (ABBV-599) with a Bruton’s Tyrosine Kinase inhibitor (elsubrutinib, 60 mg), in patients with moderately to severely active systemic lupus erythematosus (SLE). The study met the primary endpoint of SLE Responder Index (SRI-4) with a steroid dose of less than or equal to 10 mg per day at week 24 in patients with moderately to severely active SLE. Based on these results, AbbVie intends to advance its clinical program of Rinvoq in SLE to Phase 3.
•At the Congress of European Crohn’s and Colitis Organisation (ECCO), AbbVie presented 24 abstracts, including four oral presentations, two digital oral presentations and 18 posters from a broad range of studies across its inflammatory bowel disease (IBD) portfolio. Highlights included data from the ADVANCE, MOTIVATE and FORTIFY studies highlighting efficacy outcomes and clinical response in patients receiving Skyrizi for treatment of moderately to severely active CD, sub-analyses from the U-EXCEL, U-EXCEED and U-ENDURE studies evaluating Rinvoq for the treatment of moderately to severely active CD and analyses evaluating Rinvoq for the treatment of UC.
•At the 2023 American Academy of Dermatology (AAD) Annual Meeting, AbbVie presented more than 20 abstracts showcasing the strength of its dermatology portfolio. Notable presentations included late-breaking data that demonstrated Skyrizi improved plaque psoriasis (PsO) signs and symptoms among moderate to severe PsO patients that previously had a suboptimal response to IL-17 inhibitor therapy; abstracts assessing long-term outcomes of Skyrizi in patients with active psoriatic arthritis (PsA); subgroup analyses of outcomes in adults and adolescents with atopic dermatitis (AD) from three Phase 3 trials assessing the efficacy and safety of Rinvoq across 52 weeks; and results from a Phase 2 study evaluating the efficacy and safety of Rinvoq in moderate-to-severe hidradenitis suppurativa (HS).
•AbbVie announced that it intends to voluntarily withdraw the U.S. accelerated Imbruvica (ibrutinib) approvals for patients with mantle cell lymphoma (MCL) who received at least one prior therapy and patients with marginal zone lymphoma (MZL) who require systemic therapy and received at least one prior anti-CD20-based therapy. This voluntary action was due to requirements related to the accelerated approval status granted by the U.S. Food and Drug Administration (FDA) for MCL and MZL. Other approved indications for Imbruvica in the U.S. were not affected by this withdrawal and Imbruvica’s established clinical profile in other approved indications is unchanged. Imbruvica is jointly developed and commercialized with Janssen Biotech, Inc.
•AbbVie announced that the FDA approved expanding the indication of Qulipta (atogepant) for the preventive treatment of migraine in adults. The approval makes Qulipta the only oral calcitonin gene-related peptide (CGRP) receptor antagonist approved to prevent episodic and chronic migraine. The expanded indication provides an additional treatment option for those with chronic migraine whose frequent disabling attacks negatively impact performance of daily activities. Approval is based on a clinical trial that demonstrated statistically significant reduction from baseline in mean monthly migraine days and improvements in function and reduction in activity impairment.
•AbbVie announced it received a Complete Response Letter (CRL) from the FDA for the New Drug Application (NDA) for ABBV-951 (foscarbidopa/foslevodopa) for the treatment of motor fluctuations in adults with advanced Parkinson’s disease (PD). In its letter, the FDA requested additional information about the device (pump) as part of the NDA review. The CRL did not request that AbbVie conduct additional efficacy and safety trials related to the drug. AbbVie plans to resubmit the NDA as soon as possible.
•AbbVie and Capsida Biotherapeutics Inc. (Capsida) announced an expanded strategic collaboration to develop genetic medicines for eye diseases with high unmet need. The collaboration builds on the partnership announced in 2021. Under the expanded collaboration, AbbVie’s extensive capabilities will be paired with Capsida’s novel adeno-associated virus (AAV) engineering platform and manufacturing capability to identify and advance three programs.
Full-Year 2023 Outlook
AbbVie is raising its adjusted diluted EPS guidance for the full year 2023 from $10.62 – $11.02 to $10.72 – $11.12, which includes an unfavorable impact of $0.08 per share related to acquired IPR&D and milestones expense incurred during the first quarter 2023. The company’s 2023 adjusted diluted EPS guidance excludes any impact from acquired IPR&D and milestones that may be incurred beyond the first quarter of 2023, as both cannot be reliably forecasted.