AbbVie expects Rinvoq, Skyrizi sales to reach combined $4.6B in 2021

AbbVie Inc.'s two newest immunology drugs, Rinvoq and Skyrizi, could reach combined sales of $4.6 billion in 2021, double the $2.3 billion they generated in 2020, CEO Rick Gonzalez said on the pharmaceutical giant's Feb. 3 earnings call.

Competitors are closing in on AbbVie's blockbuster Humira, an immunology treatment that reached $19.83 billion in 2020 and has consistently been the world's best-selling drug. Biosimilars are due to enter the U.S. market in 2023.

Humira's reported sales grew 3.5% in the U.S. in 2020 and fell 13.6% in international sales due to biosimilar competition outside of the U.S.

That leaves big shoes for Rinvoq and Skyrizi to fill after just one full year on the market, and Gonzalez said the two drugs are expected to contribute more than $15 billion in sales by 2025.

"We have a much more diverse business now with four major growth platforms that are helping us drive that level of growth," Gonzalez said. Beyond Skyrizi and Rinvoq, the CEO noted two other recent launches — migraine treatment Ubrelvy and bipolar depression drug Vraylar — are doing "extremely well."

Both Rinvoq and Skyrizi beat consensus sales expectations, RBC Capital analyst Randall Stanicky pointed out in a Feb. 3 note.

"Why does this matter?" Stanicky wrote. "Because it remains a source of upward revision with consensus in 2025 for the combined products of $12.5 billion well below AbbVie's target of at least $15 billion laid out."

With the sales bump, AbbVie raised 2021 EPS estimates to between $12.32 and $12.52, 17% above the consensus estimate of $12.20, Cowen analyst Steve Scala said in a note.

The company now expects $55.7 billion in revenue in 2021.

Rinvoq, in particular, could pick up a new indication in April if the U.S. Food and Drug Administration approves the drug for eczema, otherwise known as atopic dermatitis.

Like Pfizer Inc.'s Xeljanz — up for the same FDA approval — Rinvoq is in a class of drugs called JAK inhibitors. In late January, Xeljanz demonstrated cardiovascular side effects in patients over the age of 50 who also have risk factors.

RBC's Stanicky noted Feb. 1 that AbbVie has seen no such side effects despite being in the same drug class.

"There was some concern around the Xeljanz data as read-through to Rinvoq, but not at the level we think some investors may have thought and notably this patient population makes up a small component of those expected to be given a JAK inhibitor for atopic dermatitis," Stanicky said.

AbbVie Vice Chairman and President Michael Severino, who heads R&D, confirmed on the call that the FDA had not shown concern, either.

"Regulators have not asked us do a long-term safety study in the way that Pfizer was asked," Severino said. "So it has not been discussed with regulators, and we have not had any contact with regulators around labeling updates up to the present time."

COVID-19 challenges remain

After AbbVie closed the $63 billion acquisition of Botox-maker Allergan in May 2020, the aesthetics business took a major hit from COVID-19, Gonzalez said — but further recovery is on the way.

"We continue to closely monitor the COVID dynamics, which will have an impact on our business again in 2021," Gonzalez said, adding that the impact would mostly affect the first half of 2021 and significantly less so than in 2020.

Gonzalez said the aesthetics unit is "expected to generate high single-digit revenue growth over the next decade" and that the company is in it for the long haul despite COVID-19 effects of the past year.

"Emphatically, we have no interest in spinning off the aesthetics business," Gonzalez said.

Sales of chronic lymphocytic leukemia drugs Imbruvica and Venclexta also slowed during the pandemic, Gonzalez said, because therapy for that type of cancer can be delayed for some time as compared to others.

Fourth-quarter and full-year 2020

AbbVie included prior financial results from Allergan — acquired in May 2020 — in its fourth-quarter and full-year report as if the acquisition closed Jan. 1, 2019, for comparable results year over year, the company said.

AbbVie's fourth-quarter non-GAAP adjusted EPS rose to $2.92 from $2.21 in the same period a year ago.

The S&P Capital IQ consensus normalized EPS estimate for the fourth quarter was $2.85.

AbbVie's after-tax adjusted earnings increased to $5.23 billion from $3.29 billion a year earlier.

The North Chicago, Ill.-based pharmaceutical giant's adjusted net revenues rose 6.8% to $13.86 billion. Without Allergan included in the figure, the rise was 59.2% more than AbbVie's $8.7 billion in the fourth quarter of 2019.

Worldwide sales of blockbuster drug Humira amounted to $5.15 billion in the fourth quarter of the year, with full-year sales of $19.83 billion.

For the full year 2020, the company's after-tax adjusted earnings rose to $17.78 billion, or $10.56 per share, from $13.32 billion, or $8.94 per share, a year ago.

The S&P Capital IQ consensus normalized EPS estimate for 2020 was $10.48.

AbbVie's adjusted net revenues in 2020 increased 3.3% — including Allergan — to $45.78 billion. Without Allergan in the figures, AbbVie's adjusted net revenue rose 37.6% from the year before.