• Full-Year Adjusted Earnings Per Share: $10.12, $0.49 above initial guidance midpoint.
• Total Net Revenues: $56.3 billion, exceeding initial guidance by more than $2 billion.
• Ex-HUMIRA Platform Sales Growth: More than 18% for the full year, 22% in the fourth quarter.
• SKYRIZI and RINVOQ Combined Revenue: Approximately $17.7 billion, an increase of nearly $6 billion year over year.
• Fourth-Quarter Immunology Revenues: Approximately $7.3 billion.
• Fourth-Quarter Oncology Revenues: Approximately $1.7 billion.
• Fourth-Quarter Neuroscience Revenues: $2.5 billion, up 19.9% operationally.
• Fourth-Quarter Aesthetics Sales: Approximately $1.3 billion, operational decrease of 4.4%.
• Fourth-Quarter Adjusted Earnings Per Share: $2.16, $0.08 above guidance midpoint.
• Fourth-Quarter Total Net Revenues: $15.1 billion, 6.1% operational growth.
• Adjusted Gross Margin: 83.8% of sales.
• Adjusted R&D Expense: 15.1% of sales.
• Adjusted SG&A Expense: 23.6% of sales.
• Adjusted Operating Margin Ratio: 34.7% of sales.
• Net Interest Expense: $610 million.
• Adjusted Tax Rate: 20.2%.
• 2025 Full-Year Adjusted Earnings Per Share Guidance: Between $12.12 and $12.32.
• 2025 Total Net Revenues Forecast: Approximately $59 billion, 5.7% operational growth.
• 2025 Free Cash Flow Expectation: Approaching $17 billion.

• Warning! GuruFocus has detected 5 Warning Signs with ABBV.

Release Date: January 31, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• AbbVie Inc (NYSE:ABBV) delivered full-year adjusted earnings per share of $10.12, exceeding initial guidance by $0.49.
• Total net revenues were $56.3 billion, surpassing initial guidance by more than $2 billion.
• The ex-HUMIRA platform showed strong performance with a 22% revenue growth in the fourth quarter.
• SKYRIZI and RINVOQ are expected to generate nearly $24 billion in revenue in 2025, with a projected increase to over $31 billion by 2027.
• The neuroscience segment is projected to achieve $10 billion in sales in 2025, reflecting growth across psychiatry, migraine, and Parkinson's treatments.

Negative Points

• Global sales of HUMIRA declined by 48.7% due to biosimilar competition, with further access reductions anticipated in 2025.
• The aesthetics segment experienced a 4.4% operational decrease in sales, impacted by challenging market conditions in the US and China.
• The Medicare Part D benefit redesign is expected to have a roughly 4% net unfavorable impact on AbbVie's portfolio in 2025.
• IMBRUVICA revenues declined by 6.2% due to competitive dynamics in chronic lymphocytic leukemia (CLL).
• The aesthetics market faces headwinds from economic conditions, with a cautious outlook for modest sales growth in 2025.

Q & A Highlights

Q: Can you comment on the pricing dynamics for SKYRIZI and RINVOQ and how you factored in pricing for this year and the next several years? Also, what is the current market share for BOTOX and JUVEDERM? A: Jeffrey Stewart, Executive Vice President, Chief Commercial Officer, explained that SKYRIZI and RINVOQ are primarily volume-based businesses, with consistent low single-digit price declines expected. Robert Michael, CEO, added that the strategy is to elevate the standard of care and drive growth beyond HUMIRA, with volume being the main growth driver. Carrie Strom, Senior Vice President, noted that BOTOX's market share is in the low to mid-60s, and JUVEDERM's is in the low to mid-40s, with efforts underway to recapture lost share.

Q: What are the main drivers for the increased 2027 guidance for SKYRIZI and RINVOQ, and how should we think about growth beyond 2027? A: Jeffrey Stewart highlighted that the primary driver is share capture across various indications, with significant growth in IBD. Scott Reents, CFO, provided a breakdown, indicating $11 billion for RINVOQ and $20 billion for SKYRIZI by 2027. Robert Michael added that growth beyond 2027 is expected to continue, with RINVOQ likely growing faster due to new indications.

Q: Regarding the Cerevel impairment, what are the drivers for the remaining value, and what is the outlook for aesthetics growth? A: Robert Michael explained that the impairment reflects a more risk-adjusted view of emraclidine, but there is still optimism for tavapadon. Scott Reents noted that aesthetics growth is expected to recover, with 2025 likely being the trough, and a high single-digit CAGR projected through 2029.

Q: Can you discuss the impact of the Part D redesign and the potential of your pipeline, specifically the NLRX1 agonist? A: Scott Reents stated that the Part D redesign is expected to have a roughly 4% headwind, with modest volume offsets. Roopal Thakkar, Chief Scientific Officer, mentioned that the NLRX1 agonist is in Phase 2 for ulcerative colitis, with potential for Phase 3 if results are positive.

Q: How do you view the growth dynamics in the immunology and inflammation (I&I) space, and what are the long-term market growth expectations? A: Jeffrey Stewart noted that while some HUMIRA prescriptions are shifting to SKYRIZI and RINVOQ, the I&I market is expanding due to new lines of therapy. Robert Michael added that high single-digit growth is expected in psoriasis and IBD, with mid-teens growth in atopic dermatitis.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.