AbbVie(US:ABBV)2024-02-02 18:00Financial Data and Key Metrics Changes - AbbVie reported total net revenues of $54.3 billion for the year, exceeding initial guidance by approximately $2.3 billion [9] - Adjusted earnings per share for the full year were $11.11, which is $0.63 above the initial guidance midpoint [9] - The adjusted operating margin ratio was 43.8% of sales, with an adjusted gross margin of 83.9% [39] Business Line Data and Key Metrics Changes - The growth platform excluding Humira delivered full-year sales growth of over 8%, with revenue growth accelerating to more than 15% in Q4 [6] - Immunology revenues exceeded expectations, with Skyrizi sales at approximately $2.4 billion (51.6% operational growth) and Rinvoq at over $1.2 billion (62.8% operational growth) [15] - Oncology revenues totaled $1.5 billion, with Imbruvica down 19% to $903 million and Venclexta up 13.7% to $589 million [19] - Aesthetics sales were approximately $1.4 billion, with U.S. Botox Cosmetic sales increasing by 7.3% [24] Market Data and Key Metrics Changes - Global sales for Skyrizi are expected to exceed $17 billion by 2027, while Rinvoq is anticipated to achieve over $10 billion in the same timeframe [13] - The U.S. market for Humira saw a 40.8% decline due to biosimilar competition, with global sales at $3.3 billion [18] - Neuroscience revenues were over $7.7 billion for the year, reflecting nearly $1.2 billion in growth [21] Company Strategy and Development Direction - AbbVie is focused on driving strong performance from its ex-Humira growth platform, with key brands expected to contribute double-digit sales growth in 2024 [10] - The company plans to prioritize investments in its pipeline, with several important R&D programs anticipated for updates this year [11] - AbbVie aims to close and integrate the acquisitions of ImmunoGen and Cerevel, which are expected to enhance revenue growth into the next decade [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to operational sales growth in 2024, one year after the Humira loss of exclusivity [8] - The long-term sales outlook includes a return to robust revenue growth in 2025, with a high single-digit CAGR through the end of the decade [12] - Management highlighted the significant growth potential in the immunology market, particularly for Rinvoq and Skyrizi [53] Other Important Information - AbbVie increased its quarterly dividend, which has grown by more than 285% since inception [7] - The company expects to generate free cash flow of approximately $18 billion in 2024, supporting dividend growth and debt repayment [45] Q&A Session Summary Question: Long-term immunology outlook and growth drivers - Management indicated that there is significant headroom for growth in immunology, with both Rinvoq and Skyrizi expected to contribute to revenue growth beyond 2027, with Rinvoq likely having a higher growth rate due to new indications [50][55] Question: Succession planning update - Management stated that there is no new update on succession planning but emphasized that the transition will occur when the business is performing at a high level post-Humira LOE [58][60] Question: Commercial opportunity for lutikizumab in HS - Management highlighted that HS is a significant commercial opportunity, with expectations for continued market expansion and the potential for lutikizumab to succeed in IBD due to its mechanism of action [63][64] Question: Impact of RNA IRA-mediated price cuts - Management believes that the impact of IRA negotiations will be largely contained to the Medicare side and will not significantly affect the commercial market [67] Question: Plans for ImmunoGen acquisition and earlier lines of therapy - Management discussed strategies to move Elahere into earlier lines of ovarian cancer therapy, focusing on sensitive populations and combination therapies [71]