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Will Humira, Cancer Drugs Drive AbbVie (ABBV) Q3 Earnings?

AbbVie, Inc.’s ABBV flagship product, Humira sales are likely to have decelerated in the third quarter, given the launch of biosimilars in international markets, especially Europe. The drug is approved for several inflammatory indications. It is also a major revenue generating drug for AbbVie, bringing almost half of the company’s revenues in the first half of 2020.

Meanwhile, in the United States, market growth across all indications were partially offset by lower new patient starts due to COVID-19 impact in the second quarter. However, gradual re-opening of the U.S. market is likely to have led to better U.S. sales of the drug in the soon-to-be reported quarter. However, concern remains as Humira is a physician administered drug and the impact remains to be seen when the company reports.

The Zacks Consensus Estimate for Humira stands at $5.02 billion. The Zacks Consensus Estimate for U.S. sales is pegged at $4.2 billion while that for international sales is $825 million.

AbbVie’s stock has declined 6.6% this year so far compared with the decrease of 3.2% for the industry.

New immunology drugs, Skyrizi and Rinvoq are likely to have contributed to top-line growth. The Zacks Consensus Estimate for Skyrizi is $374 million.

Sales of key oncology medicine, Imbruvica were driven by continued penetration for patients with chronic lymphocytic leukemia in the first half of 2020. The drug is marketed in partnership with J&J JNJ globally. The Zacks Consensus Estimate for the drug is pegged at $1.47 billion, comprising sales of $1.21 billion in the United States and $261 million of international profit sharing with J&J.

Sales of another leukemia drug, Venclexta, are gaining from continued share gains across all approved indications since the past few quarters. However, lower new patient utilization may have impacted third-quarter performance as Venclexta is a hospital-based treatment. AbbVie markets Venclexta in partnership with Roche RHHBY. The Zacks Consensus Estimate for the drug is pegged at $296 million.

Sales of other drugs like Duodopa, Creon, Synthroid, and Lupron are likely to have increased in the quarter.

However, sales of AbbVie’s new HCV drug, Mavyret are likely to have been hurt by lower patient volumes in certain international markets and competitive dynamics in the United States. The Zacks Consensus Estimate for the HCV segment, mainly comprising Mavyret, stands at $602 million.

With acquisition of Allergan, AbbVie added a key drug, Botox, to its portfolio. The drug is available as therapeutics as well as cosmetic. However, performance of the drug in both segments was significantly hurt in the second quarter due to COVID-19 related restrictions. On its second-quarter earnings call, AbbVie had stated that both segments of the drug were performing near pre-COVID levels. The impact of re-opening of economies remains to be seen.

AbbVie Inc. Price and Consensus

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

Zacks Rank & Stock to Consider

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

A top-ranked biotech is Horizon Therapeutics HZNP, which carries a Zacks Rank #2 (Buy). Its earnings estimates for 2020 and 2021 have risen 2.8% and 3.7%, respectively over the past 30 days. The stock has risen 115.9% this year so far.

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