I'm an investment analyst with clinical experience in healthcare and an MBA, expanding my focus from biotech to a range of sectors. I've had the privilege of sharing my insights on Seeking Alpha since 2017, emphasizing financial modeling techniques like DCF analysis to identify underlying assumptions in stock valuations. I provide scenario-based forecasts to help readers gauge reasonable outcomes. Influenced by works like Superforecasting and Antifragile, I advocate for disciplined risk management through a ...

On Monday, AbbVie Inc ABBV stock plunged after two trials investigating emraclidine as a once-daily, oral monotherapy treatment for adults with schizophrenia failed two Phase 2 trials.The studies did not meet their primary endpoint of showing a statistically significant improvement in the change from baseline in the Positive and Negative Syndrome Scale (PANSS) total score compared to the placebo group at week 6.Truist says due to the failure, Bristol Myers Squibb & Co’s BMY Cobenfy (xanomeline and trospium ...

About this content About William Farrington William kickstarted his career as a researcher and reporter for a global legal publication, covering everything from public law to M&A. Before moving to Proactive Investors, he worked as a reporter for a major fintech company with a focus on cryptocurrency and blockchain technology. Harking from Queensland, Australia, William obtained first-class honours in journalism and media from Birkbeck University before going on to complete an MA in creative and critical ...

AbbVie’s (ABBV) mid-stage studies of emraclidine for schizophrenia failed to meet their primary endpoint. Shares of the company lost 12.6% on Monday in response to the disappointing news. However, Bristol Myers’ (BMY) stock was up 10.5% following ABBV’s news.The studies were designed to show a statistically significant reduction (improvement) in the change from baseline in the Positive and Negative Syndrome Scale (PANSS) total score upon treatment with the candidate compared with the placebo group at week 6 ...

Core Viewpoint - AbbVie experienced a significant drop in stock price following the failure of its drug Emraclidine in clinical trials, which was anticipated to be a major revenue driver. This has raised concerns among investors about the company's future growth prospects [1][2]. Group 1: Stock Performance and Market Reaction - AbbVie stock (NYSE: ABBV) fell 12% on November 11 after the announcement of failed clinical trials for Emraclidine [1]. - Despite the recent decline, ABBV stock has seen a 90% increase since January 2021, rising from $92 to approximately $175, outperforming the S&P 500 and the S&P 500 Healthcare index during the same period [3]. - The stock's price-to-sales (P/S) ratio increased by 60% to 5.7x, compared to 3.6x in 2020, reflecting investor confidence due to rising sales despite competition [3]. Group 2: Revenue Growth Factors - AbbVie's revenue grew by approximately 20% from $45.8 billion in 2020 to $55.5 billion, largely driven by the acquisition of Allergan [5]. - Sales of Humira peaked at $21.2 billion in 2022 but fell by 32.2% year-over-year to $14.4 billion in 2023, with a further decline of 34% to $7.2 billion for the nine-month period ending September 2024 due to biosimilar competition [5][6]. - Newer drugs, Skyrizi and Rinvoq, generated $11.7 billion in 2023, marking a 53% year-over-year growth, while Vraylar's sales increased by 35% to $2.8 billion [6]. Group 3: Inorganic Growth and Acquisitions - AbbVie has pursued inorganic growth through acquisitions, including ImmunoGen for $10.1 billion and Cerevel Therapeutics for $8.7 billion, although the latter's drug Emraclidine has faced setbacks [7]. - The company is also in the process of acquiring Aliada Therapeutics for $1.4 billion, focusing on its Alzheimer's treatment pipeline [7]. Group 4: Profit Margins and Financial Health - AbbVie's operating margin has slightly decreased from 27.8% in 2020 to 26.1% currently, impacted by increased expenses related to research and development [8]. - Cash reserves have declined from $8.5 billion in 2020 to $7.3 billion, while total debt has decreased from $86.1 billion to $71.1 billion, indicating a manageable financial risk profile [9]. Group 5: Future Growth Potential - ABBV stock has risen 17% in 2024, underperforming the S&P 500, which increased by 26% [10]. - The stock trades at a P/S ratio of 5.7x, above its three-year average of 4.4x, suggesting potential for growth given market share gains from new drugs [12]. - Skyrizi and Rinvoq are expected to continue gaining market share, with peak sales estimates of $20 billion and $12 billion, respectively, which could support AbbVie's revenue growth despite the decline in Humira sales [13].

Group 1 - The articles on AbbVie Inc. and Pfizer Inc. provide actionable investment ideas based on independent research [1] - The investment strategy aims to help members outperform the S&P 500 while minimizing drawdowns during market volatility [2] Group 2 - The portfolio experienced a maximum drawdown of 7.3% during the 2022 correction, compared to a 51% drawdown in the S&P 500 [3] - The portfolio's performance during major market turbulence shows resilience, with drawdowns of -20.0% in Jan-Mar 2020 and -19.6% in Sept-Oct 2021 [3]

Group 1 - AbbVie shares are experiencing a significant decline of nearly 10% following the failure of its schizophrenia treatment drug to meet its primary endpoint in a late-stage study [1] - The failure of the drug represents a substantial setback for AbbVie, impacting investor confidence and market perception [1] Group 2 - The article does not provide additional insights or data regarding the broader industry context or other companies [2]

Core Insights - AbbVie experienced a significant decline in stock value, dropping 12% following disappointing results from a schizophrenia drug trial [1] - The emraclidine treatment failed to meet its primary endpoint in a phase 2 trial, showing no statistically significant improvement over a placebo [2] - AbbVie expressed disappointment over the trial results but remains committed to analyzing the data for future steps [3] Acquisition Context - AbbVie recently acquired Cerevel Therapeutics for $8.7 billion, with the emraclidine drug being a key motivation for the acquisition [4] - The acquisition included other pipeline programs, notably the promising Parkinson's disease treatment tavapadon, which has shown positive results in late-stage trials [5]

Group 1 - AbbVie Inc's stock fell 11.7% to $176.16 after two Phase 2 trials for emraclidine, a treatment for schizophrenia, failed to meet primary endpoints [1][4] - The trials did not show a statistically significant improvement in the Positive and Negative Syndrome Scale (PANSS) total score compared to the placebo group at week 6 [1] - Cantor Fitzgerald noted that Wall Street had anticipated positive results, but the details were expected to be mixed [2] Group 2 - The disappointing trial results for AbbVie may benefit Bristol Myers Squibb's approved schizophrenia drug, Cobenfy, and raise questions about selective muscarinic targeting for schizophrenia treatment [3] - Cantor Fitzgerald maintains an Overweight rating on AbbVie with a price target of $240 despite the negative trial results [3] - AbbVie's acquisition of Cerevel still holds promise with ongoing treatments like Darigabat for epilepsy and anxiety, and Tavapadon for Parkinson's [4]

Group 1 - AbbVie shares fell 12% after the company announced that its schizophrenia drug Emraclidine missed key goals in two Phase 2 clinical trials [1][2][3] - The trials did not demonstrate a statistically significant improvement in symptoms compared to the placebo group at week 6 [2] - AbbVie is continuing to analyze the data to determine next steps following the disappointing results [2] Group 2 - Shares of Bristol Myers Squibb, which produces the recently approved schizophrenia treatment Cobenfy, increased by 12% [1][3] - Year-to-date, AbbVie shares are up approximately 13%, while Bristol Myers Squibb shares have risen by 18% [3]