Sector News

After strong Q3, no $55B deals in AbbVie’s future, CEO says. But a smaller one? Maybe

October 31, 2014
Life sciences
No Shire? No problem for AbbVie. At least, for now.
 
The Illinois drugmaker’s top dog, Humira, is still churning out forecast-topping sales, and it will be for the foreseeable future, the company said Friday. Following a 17.5% global sales leap for the world’s best-selling drug–which has been posting double-digit growth numbers ever since the company spun off from parent Abbott Laboratories early last year–AbbVie now predicts an EPS range of $3.25 to $3.27 for 2014, up from $3.06 to $3.16. 
 
But with a 2016 patent expiration date and biosimilars makers already taking aim, Humira won’t last forever, which was one reason the company this summer agreed to buy Irish drugmaker Shire ($SHPG) for $55 billion–or so industry-watchers thought. Following new U.S. rules that tightened the reins on tax inversions, AbbVie pulled the plug on the deal.
 
And going forward, investors shouldn’t expect a repeat, CEO Richard Gonzalez said on a call with investors. With a Q3 EPS increase of 8.5% and revenue jump of 7.8%–as well as some significant growth prospects on the horizon, like a hep C combo AbbVie expects to launch this year–the company is “in an even stronger position today than before we announced the Shire deal.”
 
“What I don’t think is that we absolutely have an imperative to run out and do another $50 billion deal, and it’s unlikely we would do another $50 billion deal,” he said.
 
On the other hand, considering the company’s cash buildup, “we clearly have the wherewithal to be active on the M&A front,” Gonzalez said–assuming the right target comes along.
 
“We’re going to continue to look for those opportunities that strategically fit and give us a strong financial return,” he said, “and we’ll deploy our capital accordingly.”
 
By Carly Helfand
 

comments closed

Related News

October 17, 2021

Colorcon acquires a majority share in Ideal Cures Pvt. Ltd., India

Life sciences

Ideal Cures will operate as a fully independent entity within Colorcon. Their business complements Colorcon’s position in the Indian pharmaceutical market with a strong presence in the domestic generic sector comprised of long-standing customer relationships sustained by innovative and customized solutions.

October 17, 2021

Barriers exist, but participation urgent in breast cancer clinical trials: report

Life sciences

Across four new breast cancer treatments approved by the FDA last year, 2% to 9% of patients in clinical trials for the drugs were Black Americans and 0% to 9% were Hispanic, according to a new report from Breastcancer.org.

October 17, 2021

Danish consortium acquires part of Jernbanebyen to create one of the world’s healthiest urban villages

Life sciences

The southern section of Jernbanebyen in central Copenhagen has a new owner. The Baneby Consortium, comprising NREP, Novo Holdings and Industriens Pension, has bought the land from Freja Ejendomme. The ambition is to create a green, partly car-free environment that will also be one of the healthiest in the world. 

Send this to a friend