AbbVie Inc. doesn’t foresee an earnings slump in 2024, the first full year its blockbuster anti-inflammatory drug Humira faces competition from cheaper alternatives in the US.
(Bloomberg) — AbbVie Inc. doesn’t foresee an earnings slump in 2024, the first full year its blockbuster anti-inflammatory drug Humira faces competition from cheaper alternatives in the US.
Humira will remain available on drug plans accessible to more than 90% of insured Americans in 2023, Chief Executive Officer Rick Gonzalez told an audience at the JPMorgan Healthcare Conference in San Francisco Tuesday. That means most of those on the drug won’t be forced to switch to a cheaper alternative.
The company also has a pipeline of drugs to treat oncology, neurology and even eye-health issues that support AbbVie’s long-term earnings and growth prospects.
“We remain well positioned to absorb the impact,” Gonzalez said.
This year is pivotal for North Chicago, Illinois-based AbbVie. It received $20.7 billion in revenue from the anti-inflammatory injection Humira in 2021, making it the company’s largest drug. This year AbbVie’s legal protections from Humira’s competitors expire in the US and a range of biosimilars, some of which have already cut into sales in Europe, hit the market. A drug from Amgen Inc. will be the first such biosimilar available in the US, starting Jan. 31.
Investors are closely watching for signals on when exactly AbbVie’s revenue will decline and by how much. Gonzalez said revenue will drop more sharply in the second half of 2023, as a group of biosimilars hit the market.
Analysts are forecasting AbbVie’s adjusted earnings-per-share to decline each year from 2022 to 2024, according to estimates compiled by Bloomberg. The company hasn’t released its initial guidance for 2023 yet but Gonzalez said he doesn’t expect the following year’s profit to fall below that forecast.
One key piece of the equation is how pharmacy-benefits managers, or PBMs, cover Humira and several forthcoming biosimilars. These companies play a role in determining which drugs their members can access.
AbbVie has vowed to ensure Humira remains broadly available alongside biosimilars, a strategy that so far appears to be working. UnitedHealth Group Inc. and Cigna Corp., which run some of the largest pharmacy-benefits managers in the US, have said they’ll keep covering Humira while making biosimilars available to their members, avoiding the worst-case scenario for AbbVie. The largest PBM, CVS Health Inc., is still working on its approach, an executive recently told Bloomberg News.
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