AbbVie Reports Third-Quarter 2022 Financial Results
AbbVie (NYSE:ABBV) announced financial results for the third quarter ended September 30, 2022.
“We continue to see strong momentum from our key immunology assets, Skyrizi and Rinvoq, and this performance – combined with strength from other growth drivers within our diverse portfolio – has mitigated the impact of temporary economic headwinds on our aesthetics products to deliver another quarter of strong results,” said Richard A. Gonzalez, chairman and chief executive officer, AbbVie. “Based upon our performance and confidence in AbbVie’s long-term outlook, we are once again meaningfully raising our dividend.”
Note: “Operational” comparisons are presented at constant currency rates that reflect comparative local currency net revenues at the prior year’s foreign exchange rates.
1 Beginning in the first quarter 2022, AbbVie includes the impact of upfront and milestone payments related to collaborations, licensing agreements and other asset acquisitions in its reported non-GAAP financial measures.
Third-Quarter Results
Worldwide net revenues were $14.812 billion, an increase of 3.3 percent on a GAAP basis, or 5.4 percent on an operational basis.
Global net revenues from the immunology portfolio were $7.651 billion, an increase of 14.6 percent on a reported basis, or 16.4 percent on an operational basis.
Global net revenues from the hematologic oncology portfolio were $1.650 billion, a decrease of 11.7 percent on a reported basis, or 9.9 percent on an operational basis.
Global net revenues from the neuroscience portfolio were $1.672 billion, an increase of 6.7 percent on a reported basis, or 8.3 percent on an operational basis.
Global net revenues from the aesthetics portfolio were $1.301 billion, an increase of 4.0 percent on a reported basis, or 8.1 percent on an operational basis.
On a GAAP basis, the gross margin ratio in the third quarter was 66.1 percent. The adjusted gross margin ratio was 85.4 percent.
On a GAAP basis, selling, general and administrative (SG&A) expense was 22.3 percent of net revenues. The adjusted SG&A expense was 20.9 percent of net revenues.
On a GAAP basis, research and development (R&D) expense was 10.9 percent of net revenues. The adjusted R&D expense was 10.8 percent of net revenues.
Acquired IPR&D and milestones expense was 0.3 percent of net revenues.
On a GAAP basis, the operating margin in the third quarter was 31.1 percent. The adjusted operating margin was 53.4 percent.
Net interest expense was $497 million.
On a GAAP basis, the tax rate in the quarter was 10.2 percent. The adjusted tax rate was 12.9 percent.
Diluted EPS in the third quarter was $2.21 on a GAAP basis. Adjusted diluted EPS, excluding specified items, was $3.66. These results include an unfavorable impact of $0.02 per share related to acquired IPR&D and milestones expense.
Note: “Operational” comparisons are presented at constant currency rates that reflect comparative local currency net revenues at the prior year’s foreign exchange rates.
Recent Events
AbbVie announced the U.S. Food and Drug Administration (FDA) approved Rinvoq (upadacitinib, 15 mg, once daily) for the treatment of adults with active non-radiographic axial spondyloarthritis (nr-axSpA) with objective signs of inflammation who have had an inadequate response or intolerance to tumor necrosis factor (TNF) blocker therapy. The approval is supported by data from the SELECT-AXIS 2 clinical trial, in which Rinvoq delivered rapid and meaningful disease control as well as significant improvement in signs and symptoms of nr-axSpA. This approval marks the sixth FDA approved indication for Rinvoq in chronic immune-mediated diseases.
AbbVie announced the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) recommended the approval of Skyrizi (risankizumab) for the treatment of adults with moderately to severely active Crohn’s disease (CD) who have had inadequate response, lost response or were intolerant to conventional or biologic therapy. The positive opinion is based on results from three Phase 3 studies in which Skyrizi demonstrated significant improvements in clinical remission and endoscopic response, compared to placebo, as both induction and maintenance therapy. If the CHMP recommendation is accepted by the European Commission (EC), this would mark the third indication for Skyrizi in the European Union. Skyrizi is part of a collaboration between Boehringer Ingelheim and AbbVie, with AbbVie leading development and commercialization globally.
At the United European Gastroenterology (UEG) Week 2022, AbbVie shared 17 abstracts, including seven oral presentations, from a broad range of studies in inflammatory bowel disease (IBD). Highlights included final analyses from the U-ACHIEVE Phase 3 maintenance study of Rinvoq in moderately to severely active ulcerative colitis (UC), data from the U-EXCEL Phase 3 study evaluating the efficacy and safety of Rinvoq as induction therapy for use in adults with moderately to severely active CD as well as data evaluating Skyrizi for use in patients with moderate to severe CD.
At the American College of Gastroenterology (ACG) Annual Scientific Meeting, AbbVie presented 26 abstracts that illustrate AbbVie’s commitment to providing research and innovative solutions that support patients with high disease burden and unmet need. Key presentations focused on the treatment of moderate to severe CD, including late-breaking Phase 3 data from the Rinvoq 52 week maintenance trial, as well as efficacy and safety outcomes from the Skyrizi pivotal clinical program.
At the European Academy of Dermatology and Venereology (EADV) Congress, AbbVie presented 23 abstracts from across its dermatology portfolio that underscore AbbVie’s commitment to advancing research in dermatology for people living with immune-mediated skin diseases such as psoriasis (PsO), psoriatic arthritis (PsA), atopic dermatitis (AD) and vitiligo. Presentations included long-term efficacy and safety results, including real-world data, from studies of Skyrizi in moderate to severe PsO and active PsA as well as data from the largest-of-its-kind study that demonstrate the real-world burden of AD.
AbbVie announced that the FDA approved the use of Imbruvica (ibrutinib) for the treatment of pediatric patients one year and older with chronic graft versus host disease (cGVHD) after failure of one or more lines of systemic therapy. The approval marks the first approved treatment option for children with cGVHD under 12 years of age and the only Bruton’s tyrosine kinase inhibitor (BTKi) treatment for a pediatric patient population. Imbruvica is jointly developed and commercialized with Janssen Biotech, Inc.
At the International Parkinson and Movement Disorder Society’s (MDS) International Congress, AbbVie presented 13 abstracts across multiple disease states that highlighted AbbVie’s continued commitment to advancing the management of movement disorders. Highlights included results from the Phase 3 M15-736 trial evaluating the continuous subcutaneous infusion of ABBV-951 (foslevodopa/foscarbidopa) in people with advanced Parkinson’s disease (PD) as well as data on the real-world efficacy of Botox (onabotulinumtoxinA) for the treatment of spasticity and treatment of cervical dystonia.
At the Migraine Trust International Symposium (MTIS), AbbVie shared 13 abstracts, including 4 oral presentations, from a wide range of studies across its migraine portfolio that underscore AbbVie’s leadership and commitment to people living with migraine. Highlights included Phase 3 PROGRESS study results evaluating Qulipta (atogepant) for the preventive treatment of chronic migraine as well as data from studies evaluating Botox and Ubrelvy (ubrogepant) in the treatment of migraine.
Allergan Aesthetics announced that the FDA approved Juvederm Volux XC for the improvement of jawline definition in adults over the age of 21 with moderate to severe loss of jawline definition. Juvederm Volux XC is the first and only hyaluronic acid (HA) filler to receive FDA approval for jawline definition.
At the American Society for Dermatologic Surgery (ASDS), Allergan Aesthetics shared data from across its facial injectables, body contouring and skincare portfolio that highlighted Allergan Aesthetics’ continued commitment to advancing aesthetic medicine. Highlights included analyses of 15 years of post-marketing surveillance data that demonstrated the global reported rate of delayed-onset nodules associated with dermal fillers on the Vycross technology platform is low, as well as results from three clinical studies showcasing a customizable platform with patent-pending LTN Complex, to address the appearance of facial hyperpigmentation.
AbbVie announced the acquisition of DJS Antibodies (DJS), a biotechnology company dedicated to discovering and developing antibody medicines that target difficult-to-drug disease-causing proteins. The acquisition includes DJS’ lead program DJS-002, a potential first-in-class LPAR1 antagonist antibody in preclinical studies for the treatment of Idiopathic Pulmonary Fibrosis (IPF) and other fibrotic diseases as well as the company’s proprietary HEPTAD platform.
Full-Year 2022 Outlook
AbbVie is confirming the midpoint of its full-year 2022 adjusted diluted EPS guidance range and narrowing the range from $13.76 – $13.96 to $13.84 – $13.88, which includes an unfavorable impact of $0.25 per share related to acquired IPR&D and milestones expense incurred year-to-date through the third quarter 2022. The company’s 2022 adjusted diluted EPS guidance excludes any impact from acquired IPR&D and milestones that may be incurred beyond the third quarter of 2022, as both cannot be reliably forecasted.
Company Declares Dividend Increase of 5.0 Percent
AbbVie is announcing today that its board of directors declared an increase in the company’s quarterly cash dividend from $1.41 per share to $1.48 per share beginning with the dividend payable on February 15, 2023 to shareholders of record as of January 13, 2023. This reflects an increase of approximately 5.0 percent, continuing AbbVie’s strong commitment to returning cash to shareholders through a growing dividend. Since the company’s inception in 2013, AbbVie has increased its quarterly dividend by 270 percent. AbbVie is a member of the S&P Dividend Aristocrats Index, which tracks companies that have annually increased their dividend for at least 25 consecutive years.
About AbbVie
AbbVie’s mission is to discover and deliver innovative medicines that solve serious health issues today and address the medical challenges of tomorrow. We strive to have a remarkable impact on people’s lives across several key therapeutic areas: immunology, oncology, neuroscience, eye care, virology and gastroenterology, in addition to products and services across our Allergan Aesthetics portfolio. For more information about AbbVie, please visit us at www.abbvie.com. Follow @abbvie on Twitter, Facebook or LinkedIn.
Conference Call
AbbVie will host an investor conference call today at 8:00 a.m. Central time to discuss our third-quarter performance. The call will be webcast through AbbVie’s Investor Relations website at investors.abbvie.com. An archived edition of the call will be available after 11:00 a.m. Central time.
Non-GAAP Financial Results
Financial results for 2022 and 2021 are presented on both a reported and a non-GAAP basis. Reported results were prepared in accordance with GAAP and include all revenue and expenses recognized during the period. Non-GAAP results adjust for certain non-cash items and for factors that are unusual or unpredictable, and exclude those costs, expenses, and other specified items presented in the reconciliation tables later in this release. Beginning in the first quarter of 2022, the company includes the impact of upfront and milestone payments related to collaborations, licensing agreements, and other asset acquisitions in its reported non-GAAP financial measures. Prior periods have been revised to conform to the current period presentation. AbbVie’s management believes non-GAAP financial measures provide useful information to investors regarding AbbVie’s results of operations and assist management, analysts, and investors in evaluating the performance of the business. Non-GAAP financial measures should be considered in addition to, and not as a substitute for, measures of financial performance prepared in accordance with GAAP.
Forward-Looking Statements
Some statements in this news release are, or may be considered, forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “project” and similar expressions, among others, generally identify forward-looking statements. AbbVie cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the failure to realize the expected benefits of AbbVie’s acquisition of Allergan or to promptly and effectively integrate Allergan’s business, challenges to intellectual property, competition from other products, difficulties inherent in the research and development process, adverse litigation or government action, and changes to laws and regulations applicable to our industry. Additional information about the economic, competitive, governmental, technological and other factors that may affect AbbVie’s operations is set forth in Item 1A, “Risk Factors,” of AbbVie’s 2021 Annual Report on Form 10-K, which has been filed with the Securities and Exchange Commission, as updated by its Quarterly Reports on Form 10-Q and in other documents that AbbVie subsequently files with the Securities and Exchange Commission that update, supplement or supersede such information. AbbVie undertakes no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments, except as required by law.
AbbVie Inc.
Key Product Revenues
Quarter Ended September 30, 2022
(Unaudited)
% Change vs. 3Q21
Net Revenues (in millions)
Reported
Operationala
U.S.
Int’l.
Total
U.S.
Int’l.
Total
Int’l.
Total
NET REVENUES
$11,763
$3,049
$14,812
4.3 %
(0.4) %
3.3 %
9.6 %
5.4 %
Immunology
6,682
969
7,651
18.5
(6.3)
14.6
5.6
16.4
Humira
4,956
603
5,559
7.4
(25.9)
2.5
(16.8)
3.9
Skyrizi
1,221
176
1,397
79.8
50.1
75.4
70.0
78.3
Rinvoq
505
190
695
44.7
82.9
53.5
>100.0
59.3
Hematologic Oncology
1,108
542
1,650
(17.7)
3.9
(11.7)
10.3
(9.9)
Imbruvicab
849
286
1,135
(23.5)
7.6
(17.4)
7.6
(17.4)
Venclexta
259
256
515
9.2
0.1
4.5
13.2
11.3
Aesthetics
760
541
1,301
(7.4)
25.6
4.0
37.4
8.1
Botox Cosmetic
370
267
637
4.1
41.0
16.9
54.5
21.6
Juvederm Collection
125
227
352
(21.9)
16.9
(0.6)
27.7
5.3
Other Aesthetics
265
47
312
(13.1)
(0.8)
(11.4)
8.3
(10.2)
Neuroscience
1,464
208
1,672
8.6
(5.0)
6.7
6.3
8.3
Botox Therapeutic
584
115
699
9.2
3.6
8.2
14.2
10.0
Vraylar
554
—
554
20.1
n/a
20.2
n/a
20.2
Duodopa
22
88
110
(4.9)
(15.0)
(13.1)
(2.6)
(3.0)
Ubrelvy
160
—
160
(1.4)
n/a
(1.4)
n/a
(1.4)
Qulipta
62
—
62
n/m
n/a
n/m
n/a
n/m
Other Neuroscience
82
5
87
(50.5)
10.2
(49.0)
14.1
(48.9)
Eye Care
362
261
623
(38.1)
(9.1)
(28.6)
1.3
(25.2)
Lumigan/Ganfort
59
62
121
(4.4)
(18.7)
(12.2)
(8.7)
(6.7)
Alphagan/Combigan
37
36
73
(58.2)
(8.9)
(43.0)
2.9
(39.4)
Restasis
132
10
142
(56.7)
(30.7)
(55.6)
(37.7)
(55.9)
Other Eye Care
134
153
287
3.7
(2.7)
0.1
9.1
6.6
Other Key Products
788
202
990
5.5
(19.4)
(0.7)
(9.1)
1.9
Mavyret
190
193
383
3.5
(20.6)
(10.2)
(10.3)
(4.4)
Creon
336
—
336
8.5
n/a
8.5
n/a
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