AbbVie(US:ABBV)2023-02-16 16:00Revenue and Financial Performance - Net revenues for 2022 were $58,054 million, an increase of 3.3% from $56,197 million in 2021[276] - Operating earnings for 2022 were $18,117 million, compared to $17,924 million in 2021, reflecting a growth of 1.1%[276] - Net earnings attributable to AbbVie Inc. for 2022 were $11,836 million, up from $11,542 million in 2021, representing a 2.6% increase[276] - Basic earnings per share attributable to AbbVie Inc. for 2022 were $6.65, compared to $6.48 in 2021, marking a 2.6% rise[276] - Comprehensive income for 2022 was $12,545 million, an increase from $11,767 million in 2021, reflecting a growth of 6.6%[278] - Total stockholders' equity increased to $17,254 million in 2022 from $15,408 million in 2021, a growth of 12%[280] - AbbVie reported net earnings of $11,845 million for the year ended December 31, 2022, compared to $11,549 million in 2021, reflecting a year-over-year increase of 2.6%[283] - The company declared dividends totaling $10,043 million in 2022, an increase from $9,261 million in 2021[283] - Cash flows from operating activities amounted to $24,943 million in 2022, up from $22,777 million in 2021, indicating a growth of 9.5%[283] Product Portfolio and Market Presence - Humira accounted for approximately 37% of AbbVie's total net revenues in 2022[13] - AbbVie's immunology portfolio includes therapies for conditions such as rheumatoid arthritis, psoriatic arthritis, and ulcerative colitis, with significant market presence in North America and the European Union[12] - Skyrizi is approved for multiple autoimmune diseases and is administered via subcutaneous injection, with a quarterly dosing schedule after initial induction[14] - Rinvoq is indicated for several inflammatory diseases and is available in North America, the European Union, and Japan, targeting conditions like rheumatoid arthritis and atopic dermatitis[16] - Imbruvica and Venclexta are key oncology products, with Imbruvica approved for chronic lymphocytic leukemia and Venclexta for hematological malignancies[16][19] - Botox Cosmetic and the Juvederm Collection of Fillers are leading products in AbbVie's aesthetics portfolio, addressing cosmetic needs globally[19][20] - AbbVie’s neuroscience products include Vraylar for schizophrenia and bipolar disorder, and Ubrelvy for acute migraine treatment[21][22] - Mavyret is an 8-week treatment for chronic hepatitis C virus infection, approved in the U.S. and European Union[25] - Creon is a pancreatic enzyme therapy for exocrine pancreatic insufficiency, targeting patients with cystic fibrosis and chronic pancreatitis[26] Research and Development - AbbVie invests significantly in research and development, with numerous compounds in clinical development targeting complex diseases[50] - The research and development process for new pharmaceutical products typically takes 8 to 12 years, with significant uncertainty regarding regulatory approval timelines[53] - Clinical trials are conducted in sequential phases: Phase 1 focuses on safety, Phase 2 assesses efficacy, and Phase 3 involves larger populations to confirm results[53] - AbbVie collaborates with third parties, including biotechnology companies and academic institutions, to enhance its research and development efforts[50] Regulatory and Compliance - AbbVie must navigate various pricing regulations and cost containment measures imposed by governments, affecting product reimbursement and market access[66] - The Affordable Care Act mandates that AbbVie pays fees related to pharmaceutical sales to government programs and provides discounts for certain Medicare beneficiaries[70] - AbbVie faces ongoing regulatory scrutiny regarding the marketing and distribution of its products, which can impact operational costs and market strategies[63] - Compliance with regulatory requirements is ensured through inspections by the FDA and other authorities, with non-compliance potentially leading to enforcement actions[56] - Post-approval obligations include reporting adverse reactions and maintaining compliance with Good Manufacturing Practices (cGMP)[57] Competition and Market Challenges - AbbVie faces significant competition in the pharmaceutical market, particularly from anti-TNF products, JAK inhibitors, and biosimilars, which could impact revenues for its products[32][33] - Humira is experiencing direct biosimilar competition in Europe and the United States, which is expected to exert competitive pressure on AbbVie's revenues[33] Acquisitions and Investments - AbbVie completed the acquisition of Allergan plc on May 8, 2020, which significantly impacted its financial performance and product offerings[286] - The acquisition of Allergan was valued at $64,084 million, comprising $39,675 million in cash and $23,979 million in AbbVie common stock issued to Allergan shareholders[323] - AbbVie made an upfront payment of $130 million for the acquisition of Syndesi Therapeutics SA, with potential future payments of up to $870 million based on milestones[332] - AbbVie completed the acquisition of Soliton, Inc. for a total consideration of $535 million, which included cash and equity-based awards, enhancing its product portfolio in aesthetics[320] Financial Position and Debt Management - Total assets as of December 31, 2022, were $138,805 million, down from $146,529 million in 2021, a decrease of 5.3%[280] - Long-term debt and finance lease obligations decreased to $59,135 million in 2022 from $64,189 million in 2021, a reduction of 7.9%[280] - The fair value of long-term debt is estimated to decrease by $4.2 billion with a 100 basis point increase in long-term interest rates[274] - The company estimates a $155 million adverse impact on the fair value of interest rate swap contracts with a 100 basis point increase in interest rates[274] - Long-term debt as of December 31, 2022, was $63,270 million, with total obligations and commitments amounting to $63,128 million[373] Workforce and Diversity - As of January 31, 2023, AbbVie employed approximately 50,000 employees across over 70 countries[81] - Women represented 52% of management positions globally, and 37% of AbbVie's workforce comprised members of historically underrepresented populations as of December 2022[85] - AbbVie has implemented a five-year Equality, Diversity & Inclusion roadmap with formal goals aligned with this strategy[85] Environmental and Social Responsibility - AbbVie's capital expenditures for pollution control in 2022 were approximately $12 million, with estimated expenditures of $9 million for 2023[79] - AbbVie believes its operations comply with environmental protection laws, and it has ongoing remediation activities related to Superfund sites[80] - AbbVie has invested in on-site health care clinics at certain locations, providing convenient access to quality healthcare[82] Foreign Exchange and Financial Instruments - AbbVie has €5.9 billion aggregate principal amount of unsecured senior Euro notes outstanding, which are exposed to foreign currency risk[273] - A 10% appreciation in the underlying currencies being hedged would decrease the fair value of foreign exchange forward contracts by $1.4 billion at December 31, 2022[272] - The company had foreign currency forward exchange contracts with notional amounts totaling $1.7 billion as of December 31, 2022, designated as cash flow hedges[381] - In 2022, the company recognized pre-tax gains of $406 million related to foreign currency denominated debt designated as net investment hedges[389]