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AbbVie lifts profit target after cancer drug powers quarterly beat

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AbbVie lifts profit target after cancer drug powers quarterly beat
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By Tamara Mathias

(Reuters) – AbbVie Inc <ABBV.N> beat Wall Street estimates for third-quarter profit on Friday, driven by strong sales of blockbuster cancer medicine Imbruvica, and the drugmaker raised its 2018 earnings forecast, sending its shares up 4 percent.

Sales of Humira, the company’s top revenue generator and also the world’s best-selling prescription medicine, also beat market estimates.

Imbruvica, which AbbVie markets with Johnson & Johnson <JNJ.N>, brought in $972 million in the third quarter, up 41 percent from a year earlier and above the average analyst estimate of $885.6 million.

The drug has won nine FDA approvals to treat six diseases, most recently receiving the green light to treat a rare form of blood cancer in combination with Roche Holding AG’s <ROG.S> blockbuster cancer drug, Rituxan.

Sales of Humira, which accounts for about two-thirds of Abbvie’s net revenue, rose 9 percent to $5.12 billion (4 billion pounds), ahead of the $5.10 billion forecast by nine analysts polled by IBES Refinitiv.

Rivals began launching biosimilar versions of the treatment in Europe last month, and investors are worried about the impact of the rising competition in the region.

But, Wall Street analysts have pointed to AbbVie’s aggressive strategy to protect Humira from competition in its biggest market – the United States – and the potential of its newer drugs to fuel growth.

AbbVie is likely to face questions on how it plans to price Humira in the future and the impact from cheaper rivals recently launched in Europe during its conference call, scheduled for 9 a.m. ET, Credit Suisse analyst Vamil Divan said in a note.

The Chicago-based drugmaker raised its 2018 adjusted earnings per share forecast to between $7.90 and $7.92 from a prior range of $7.76 to $7.86. Analysts had forecast $7.88 per share.

Net earnings jumped 68.4 percent to $2.75 billion, or $1.81 per share.

Excluding items, AbbVie earned $2.14 per share, ahead of analysts’ estimate of $2.02 per share.

Net revenue rose nearly 18 percent to $8.24 billion in the quarter, beating the average estimate of $8.23 billion helped by sales of its blood cancer treatments.

Shares of the company were trading up 3.7 percent at $83.15 in premarket trading.

(Reporting by Tamara Mathias in Bengaluru; Editing by Saumyadeb Chakrabarty)

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