Sector News

Fretting about potential Humira pain for AbbVie? Take heart in potential cost cuts

September 24, 2015
Life sciences

Some industry-watchers foresee biosimilars gutting Humira sales not too far into the future, though maker AbbVie disagrees. If that scenario does play out, though? The Illinois pharma has room to pare down its marketing expenses, according to one analyst.

As Evercore ISI’s Mark Schoenebaum wrote in a Friday note to investors, the company’s SG&A spend on the mammoth drug is approaching $2.5 billion. If Humira sales expand the way they have been lately, the company “won’t pull” that spending, he said. But if the “bear case for biosimilars plays out,” eroding Humira’s top-line contribution, AbbVie will “quickly eliminate that spend.”

That cost-cutting opportunity was “only just starting to resonate with some investors” back in July, UBS analysts Marc Goodman and Ami Fadia wrote at the time. Currently, the Chicago-area drugmaker ranks as the No. 2 ad spender in Big Pharma, and last year it shelled out 56% of its DTC budget–$203.2 million–on Humira ads.

Of course, AbbVie doesn’t expect Humira biosimilars to even reach the market any time soon, let alone impact sales. The company predicts it’ll have the market to itself until 2020, thanks to its IP protection, Schoenebaum wrote. The way Suntrust analyst John Boris sees it, AbbVie will have time to extract “maximum value” from the franchise through volume gains, pricing, label expansion, a new formulation, etc.–all “well before” biosimilars from the likes of Amgen and Novartis enter the U.S. market, he wrote to clients over the summer.

Citi analyst Andrew Baum, on the other hand, thinks biosimilars will hit hard–and fast. Humira sales will take a hit beginning in 2018, he figured in a February note, with the med’s revenues declining from $16 billion at their peak in 2017 to $6 billion in 2022.

Meanwhile, investors also worried about the drug’s future outside the U.S., where Q2 revenues of $1.396 billion fell short of expectations by more than $200 million. On that front, CFO Bill Chase says he’s certain AbbVie will post stronger numbers in Q3, Schoenebaum wrote.

By Carly Helfand

Source: Fierce PharmaMarketing

comments closed

Related News

November 28, 2021

Founder-led biotech is making space for ideas—and diverse leaders—where it didn’t exist before

Life sciences

Decades ago, the founder-led biotech was rare and considered the tougher path to follow. Now there is a trend of founder-led biotechs that have risen in prominence in recent years, going from startup to well known with lightning speed. Scientists-turned C-suite occupants know their technology inside out. They’ve got credibility both at the bench working with their research teams and in the boardrooms selling their future products.

November 28, 2021

Pfizer to become $100B behemoth next year thanks to COVID-19 drug and vaccine: analyst

Life sciences

Pfizer’s revenue could reach $101.3 billion in 2022, with major contributions coming from the company’s BioNTech-partnered COVID vaccine and an antiviral therapeutic that has shown stellar clinical data, SVB Leerink analyst Geoffrey Porges projected in a Monday note to clients.

November 28, 2021

GlaxoSmithKline takes aim at sick pay access inequities with microgrant program and new campaign

Life sciences

In a survey commissioned by GlaxoSmithKline’s consumer health division of 2,000 working people in the U.S., almost 70% admitted to clocking in while sick, often because they couldn’t afford to lose a day’s pay. Black and Latina women were 10% more likely than white women to shun taking sick time for fear of fallout from their boss, according to the company’s 2021 Temperature Check Report.

Send this to a friend