Q3 2024 AbbVie Inc Earnings Call
Good morning, and thank you for standing by. Welcome to the Abby 3rd quarter, 2024 earnings conference call. All participants will be able to listen only until the question of the answer portion of this call. You may ask a question by pressing star 1 on your phone. Today's call is being recorded.
Speaker Change: I would now like to introduce Miss Liz Shea, Senior Vice President and Vestory Relations.
Liz Shea: Good morning and thanks for joining us. Also in the call with me today, Rob Michael, Chief Executive Officer, Jeff Stewart, Executive Vice President, Chief Commercial Officer, Rupal Thakkar, Executive Vice President Research and Development, Chief Scientific Officer.
Liz Shea: Scott Reents, Executive Vice President, Chief Financial Officer, and Carrie Strom, Senior Vice President, Abby, and President Global Allergan aesthetics.
Liz Shea: Before we get started, I'll note that some statements we make today may be considered forward-looking statements based on our current expectations. Effy Cossens, that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in our forward-looking statements.
Liz Shea: Additional information about these risks and uncertainties included in our SEC, Filing's, Abby Undertakes, No obligation to update these forward-looking statements, except is required by law. On today's conference call, non-gap financial measures will be used to help investors understand Abby's business performance.
Liz Shea: These non-gap financial measures are reconciled with comparable gapped financial measures in our earnings, released in regulatory violence from today, which can be found on our website.
Liz Shea: Following our prepared remarks, we'll take your questions. So with that, I'll turn the call over to Rob. Thank you, Liz. Good morning, everyone. And thank you for joining us.
Rob Michael: Avise Performing exceptionally well, and I'm extremely pleased with the execution against our strategic priorities, including continued devil digit sales growth from our ex-humera platform, the closing and integration of several therapeutics.
Rob Michael: and the progress we are making to build and advance a compelling pipeline of innovative medicines.
Rob Michael: Thank you. Thank you.
Rob Michael: Turning to our results, AVI's diversified portfolio delivered sales that were $260 million above our expectations and reflect robust mid-single-digit operational sales growth.
Rob Michael: Our XHUMERA platform drove this overachievement, including growth of nearly 18 percent.
Rob Michael: The momentum of Skyrizzy and RuneVoke is especially impressive.
Rob Michael: With combined sales expected to exceed 17 billion dollars this year, which is 1.3 billion above our initial expectations. And we see substantial opportunity for continued strong growth well into the next decade.
Rob Michael: Several other key products also delivered double-digit sales growth, including BenClexta, Vrelar, Uprelvi, and Qlipta.
Rob Michael: Thank you.
Rob Michael: This broad-based performance further demonstrates the strength of our commercial portfolio. For the third time this year, we are raising our full-year revenue and adjusted EPS guidance.
Rob Michael: We are increasing our full-year revenue guidance by $500 million and have now raised total revenue by $1.8 billion since our initial guidance in February.
Rob Michael: We are also raising our full-year adjusted earnings per share guidance by $0.15, and now expect adjusted EPS between $10.90 and $10.94.
Rob Michael: In addition to achieving strong Corley results, we have been very focused on investing in the business to generate sustainable long-term performance in the 2030s and beyond.
Rob Michael: During the quarter, we successfully completed the acquisition of cerebral therapeutics, strengthening our neuroscience pipeline.
Rob Michael: Cerevel enhances our ability to help patients suffering from devastating conditions, such as Parkinson's and schizophrenia. The integration has been seamless, and we are excited to have the talented Cerevel team join our organization.
Rob Michael: Within the Cereval pipeline, we are very pleased with the positive phase 3 results and emerging profile of tevapidon in Parkinson's. And we remain on track to read out both pivotal studies for emraclidine and schizophrenia in the fourth quarter.
Rob Michael: More broadly on the pipeline, we have been advancing key R&D programs across all stages of development. Some notable highlights include the U.S. approvals of Violep for advanced Parkinson's and Botox for platysma bands.
Rob Michael: The U.S. regulatory submission of TELUSO-V for non-squamous, non-small cell lung cancer.
Rob Michael: and the start of our Phase 2 Crohn's platform study, which is evaluating SkyRISI in combination with several novel biologics.
Rob Michael: David Schott, Chris Schott
Rob Michael: In summary, AVI continues to demonstrate strong commercial, operational, and R&D execution. The robust performance of our growth platform once again exceeded our expectations, and we see numerous opportunities to drive long-term growth.
Rob Michael: Further underscoring our confidence in that growth, today we announced a 5.8% increase in our quarterly cash dividend, beginning with the dividend payable in February 2025. Since inception, we have increased our quarterly dividend by more than 300%.
Speaker Change: With that, I'll turn the call over to Jeff for additional comments on our commercial highlights. Jeff?
Jeff Stewart: Thank you, Rob. I'm extremely pleased with the continued strong momentum across the therapeutic portfolio. I'll start with the quarterly results for immunology, which deliver total revenues of more than $7 billion, up 4.8% on an operational basis.
Jeff Stewart: Skyrizzy global sales were $3.2 billion, up 51.5% on an operational basis, exceeding our expectations.
Jeff Stewart: We are seeing robust prescription growth across psoriatic disease, with Skyrizzy achieving in-play, biologic share leadership in approximately now 30 key countries.
Jeff Stewart: In the U.S., we continue to capture nearly one out of every two in-place psoriatic disease patients on biologic therapy, and we see substantial room for further total share growth.
Jeff Stewart: We believe that Skyrizzy's best-in-class profile, with nearly complete skin clearance, high durability of response, easy onboarding, and quarterly dosing for maintenance therapy, sets a very high bar relative to other therapies on market or in development.
Jeff Stewart: Guy Rizzi has also demonstrated a compelling clinical profile in IBD including strong endoscopic data paired with convenient dosing.
Jeff Stewart: This differentiated profile, as well as our compelling head-to-head sequence data versus STELLARA, is supporting very rapid uptake in Crohn's disease.
Jeff Stewart: where Skyrizzy continues to gain market share globally, achieving in-play patient leadership across all lines of therapy in the U.S., Japan, and Canada.
Jeff Stewart: Sky Rizzi's U.S. in-play patient share is now approximately 32 percent, more than double the share of the second biologic treatment. And with Sky Rizzi's total prescription share of approximately 8 percent, we see significant opportunity for revenue inflection in Crohn's going forward.
Jeff Stewart: While we are still very early in our launch in the U.S. and Europe, we also anticipate robust uptake for SkyRIS-E in ulcerative colitis, the new indication.
Jeff Stewart: Initial prescription trends, as well as feedback from gastroenterologists, have been overwhelmingly positive.
Jeff Stewart: Physicians are particularly impressed with the data that has been demonstrated for naïve UC patients who have not been exposed yet to biologics, where SCIRIS-E achieved very high results for clinical remission and endoscopic response.
Jeff Stewart: We have now secured broad formulary access for SCIRISI and UC, with sales in this indication expected to ramp meaningfully over the next several quarters.
Jeff Stewart: So, given the momentum we are seeing across all of these indications, we will be raising our full-year sales guidance once again for Skyrizzy.
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Speaker Change: Turning now to Renvo, which is also demonstrating robust growth. Global sales were $1.6 billion, up 47.4% on an operational basis.
Speaker Change: We continue to see strong prescription growth across all seven of Renvoke's approved indications.
Speaker Change: I'm especially pleased with our performance in IBD, where Renvolk's uptake is exceeding our expectations.
Speaker Change: Renvoke is now capturing double-digit in-play patient share in the U.S. for ulcerative colitis as well as Crohn's disease. Both indications are now available in more than 75 countries with reimbursement and share continuing to increase.
Speaker Change: I also wanted to highlight our recent performance in atopic dermatitis where RINVOC is seeing an acceleration of in-place share following recent positive data from our second head-to-head study versus Dupixen.
Speaker Change: As an oral option that provides rapid skin clearance and itch relief, we believe Renvoke's strong differentiated profile will continue to compete well in this highly under-penetrated AD market.
Speaker Change: As a result of this continued strong performance, we will also be increasing the full-year sales guidance once again for Rinvoke.
Speaker Change: Christopher Schott, Chris Schott,
Speaker Change: Looking forward, we see substantial momentum for both Skyrizzy and Rynvok, including continued share gains across existing indications, on top of the typical underlying market growth across Room, DERM, and Gastro.
Speaker Change: Additionally, we are making excellent progress with several new indications for RINVOC across sizable markets that will have the potential to provide another significant revenue inflection in the second half of this decade and into the 2030s.
Speaker Change: From a competitive perspective, a key element of Skyrizzy and Rinvoke's success has been their strong differentiation with compelling head-to-head data against several novel therapies. This includes
Speaker Change: Skyrizzy's superiority versus Humira, Cosentix, Otezla, and Stellara in psoriasis, as well as Stellara in Crohn's disease.
Speaker Change: and Renvogt's superiority versus Humira and Orencia in rheumatoid arthritis, as well as Dupixent in atopic dermatitis.
Speaker Change: To further support our differentiation, we have another head-to-head study ongoing for Skyrizi versus SOTIK2 in psoriasis, with plans also underway now for a study comparing Skyrizi versus Antivio in ulcerative colitis.
Speaker Change: So, given all of these factors, we feel very confident about the long-term growth prospects for both Skyrizzy and Renvo.
Speaker Change: Turning now to Humira, which delivered global sales of $2.2 billion, down 36.5% on an operational basis due to biosimilar competition.
Speaker Change: While Humira's share erosion to biosimilars in the U.S. is largely in line with our expectations, we are now seeing more Humira molecule volume moving to other novel mechanisms than previously anticipated.
Speaker Change: So, while this has an unfavorable impact to Humira sales, we are seeing a benefit to Skyrizzy and Rinvoke, which is a very favorable dynamic for immunology portfolio now and certainly over the long term.
Speaker Change: Thank you for watching!
Speaker Change: Moving now to oncology, where total revenues were approximately $1.7 billion. Imbruvica global revenues were $828 million, down 8.8%, reflecting continued competitive dynamics in CLL, partially offset by higher persistency rates for existing patients.
Speaker Change: Venklexta is performing extremely well. Global sales were $677 million, up 18.2% on an operational basis.
Speaker Change: This reflects strong momentum in CLL, especially in Europe, where recent guideline changes recommend combination use of Venclexta plus BTK inhibitors as a preferred fixed-duration treatment versus continuous BTK treatment alone.
Speaker Change: Growth is also supported by our very strong share position in frontline AML, where BenClexta is the leading treatment for patients who are ineligible for intensive induction chemotherapy.
Speaker Change: We are also seeing nice sequential revenue growth from Elahir and Upkindley, which are both demonstrating strong launch trajectories.
Speaker Change: Turning now to neuroscience, where total revenues were more than $2.3 billion, up 16% on an operational basis.
Speaker Change: Raylar is demonstrating robust performance. Sales were $875 million, up 16.6% on an operational basis, reflecting continued new prescription growth in both bipolar disorder and adjunctive MDD.
Speaker Change: Within Migraine, our leading oral CGRP therapies contribute $445 million in combined revenue this quarter, reflecting growth of approximately 22% as we continue to see increasing prescription demand for both Ubrelvi and Qlipta.
Speaker Change: Global Botox therapeutic sales were 848 million dollars, reflecting strong performance in chronic migraine as well as the other approved indications.
Speaker Change: Finally, we are very excited for the recent U.S. approval of VIALEV, a transformative therapy for patients with advanced Parkinson's disease who are uncontrolled on oral therapy alone.
Speaker Change: As a less invasive, non-surgical delivery system that can provide meaningful improvements in on-time and off-time, we believe ViaLEV has the potential to significantly expand use beyond current device-aided therapies.
Speaker Change: Sales in the U.S. for Vilev are expected to ramp gradually over the next several quarters.
Speaker Change: as we work to establish the appropriate Medicare coverage and benefit determination. At the same time, we are very encouraged by the interest in uptake internationally, where we have approval now in 35 countries with several thousand patients already on treatment.
Speaker Change: Longer term, we anticipate peak sales of Violev to exceed $1 billion.
Speaker Change: So overall, I'm very pleased with the continued commercial execution and performance across the therapeutic portfolio. And with that, I'll turn the call over to Carrie for additional comments on aesthetics. Carrie? Thank you, Jeff. Third quarter global aesthetic sales were more than $1.2 billion, representing growth of 1.8% on an operational basis.
Carrie Strom: In the U.S., aesthetic sales of $791 million increased by 3.9%, driven by growth from Botox Cosmetic as well as other brands across our broad portfolio.
Carrie Strom: U.S. Botox cosmetic sales were $414 million, an increase of 6.5% versus the prior year.
Carrie Strom: favorable pricing dynamics and facial toxin market growth more than offset modest share erosion.
Carrie Strom: So Toxic Cosmetic remains the clear market leader.
Carrie Strom: U.S. Juvederm sales were $105 million. Juvederm's market-leading share was consistent with last year, and the overall seller market was roughly flat to the prior year.
Carrie Strom: While the U.S. facial injectable market remains largely stable, growth is below historical rates.
Carrie Strom: As a result, there is a reluctance from customers to maintain traditional toxin and filler inventory levels.
Carrie Strom: Based upon the relatively higher price point of filler procedures in a still-challenging U.S. economic environment, Juvederm is more impacted by this dynamic, which can be seen in third-quarter results.
Carrie Strom: Internationally, aesthetic sales were $448 million, reflecting a decline of 1.6% on an operational basis.
Carrie Strom: Within China, the economic dynamics that weighed on our results during the first half of the year have continued to impact consumer spending.
Carrie Strom: This has created challenging aesthetic market conditions that have been particularly impactful to Juvederm's performance.
Carrie Strom: Primarily due to this circumstance, we are moderating our Juvederm sales outlook for the year.
Carrie Strom: We are encouraged by the recently announced government stimulus in China. We will continue to monitor for any further developments and how it could positively impact consumer discretionary spending and aesthetic market growth.
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Speaker Change: Although the current dynamics in China are challenging, its potential remains attractive, and we are committed to bring innovation to this market that will drive long-term growth.
Speaker Change: Along those lines, in China we recently received approval for the Botox Cosmetic Indication and Master Muscle Prominence, marking the first toxin in the world to have this indication.
Speaker Change: This approval enables us to market and train to this important treatment option that addresses a top aesthetic concern among many Asian patients.
Speaker Change: In the U.S., we are pleased that we received FDA approval for the use of Botox Cosmetic to treat platysma bands.
Speaker Change: This approval positions Botox as the only cosmetic toxin with four distinct indications and enables us to market and train beyond the face for the improvement of neck and jawline appearance.
Speaker Change: We also remain excited about the opportunity for Bonte.
Speaker Change: Based upon its rapid onset and short-acting profile, FONT-E has the potential to activate new patients that are hesitant to try facial toxins, driving long-term market expansion.
Speaker Change: For more information visit www.FEMA.gov
Speaker Change: Looking to the future, we continue to see significant growth potential for our aesthetics portfolio, based upon low market penetration rates,
Speaker Change: our commitment to introduce novel treatments, our strong customer relationships, and our position as the global aesthetics leader.
Speaker Change: With that, I'll turn the call over to Roopal.
Speaker Change: David Schott, Chris Schott, John
Roopal: Thank you, Carrie. Starting with immunology, where we recently began our Phase II Crohn's disease platform study, which will evaluate Skyrizi in combination with several other novel biologics.
Roopal: This study will initially look at combinations of Skyrizi with our anti-IL-1-alpha-beta bispecific luteicizumab and our novel anti-alpha-4-beta-7 antibody, ABBV382.
Roopal: We are planning to include additional novel biologics in the future.
Roopal: Our approach in immunology has been to pursue therapies that are well differentiated and have the potential to elevate standard of care.
Roopal: We have clearly achieved this with Renvoke and Skyrizzy across multiple indications, including Crohn's disease and ulcerative colitis.
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Speaker Change: As we think about how the IBD market will evolve, we view dual mechanism approaches as having the greatest potential to achieve levels of efficacy that are above current standard of care.
Speaker Change: We are very excited about the potential for these combination therapies in IBD, and we look forward to sharing updates as the data mature.
Speaker Change: For more information visit www.FEMA.gov
Speaker Change: In oncology, we continue to make very good progress across all stages of our heme and solid tumor pipeline.
Speaker Change: in the area of solid tumors.
Speaker Change: We recently submitted our application to the FDA for accelerated approval of TalisoV as a monotherapy in patients with previously treated C-MET overexpressing EGFR wild-type non-squamous, non-small cell lung cancer.
Speaker Change: Once approved, Talisa V will become the first CMET-targeted ADC to enter non-small cell lung cancer.
Speaker Change: A segment with limited options and where patients tend to have a very poor prognosis, especially if their tumors express C-MET.
Speaker Change: We anticipate an approval decision in the first half of 2025.
Speaker Change: In the quarter, we also received a positive CHMP opinion recommending Elahir for the treatment of platinum-resistant ovarian cancer.
Speaker Change: inpatients with high expression of FR-alpha and treated with up to three prior therapies.
Speaker Change: This decision was based on the positive Phase 3 Mirosol trial, where Elahir demonstrated an overall survival benefit and significantly reduced the risk of cancer progression. We anticipate an approval decision in Europe in the fourth quarter.
Speaker Change: Thank you for watching!
Speaker Change: At the recent ESMO Congress, we presented new Phase I data for ABBV400 in advanced non-small cell lung cancer and gastroesophageal cancer.
Speaker Change: Early efficacy data from the Lung Cohort are promising, with an objective response rate of 48% across all patients in the study and response rates ranging from 60 to 78% in patients with overexpressed CMET.
Speaker Change: For more information visit www.FEMA.gov
Speaker Change: We are very pleased with the level of activity we're seeing from our next generation CMAT ADC, which compares favorably to Taliso V.
Speaker Change: where we've seen objective response rates ranging from 23% in medium CMAT expressors to 35% in patients with high CMAT expression.
Speaker Change: 400 has the potential to expand our C-MET portfolio into earlier lines of therapy and lower levels of C-MET expression in lung cancer.
Speaker Change: Thank you. Thank you. Thank you.
Speaker Change: Similarly, in patients with advanced gastroesophageal cancer, 400 demonstrated promising activity with an objective response rate of 29% across all patients.
Speaker Change: This compares well against combination and single-agent chemotherapy, which are the standards of care for patients in second-line and third-line of therapy, respectively.
Speaker Change: Based on these encouraging preliminary data, we plan to begin Phase II studies for 400 in both non-small cell lung cancer and gastroesophageal cancer.
Speaker Change: Recall, we've also advanced 400 in late-line colorectal cancer, and we remain on track to begin a Phase III study later this year.
Speaker Change: Thank you. Thank you.
Speaker Change: In the area of hematologic oncology, we received approval in Europe for Tepkinly as a monotherapy treatment for patients with relapsed refractory follicular lymphoma after two or more lines of therapy.
Speaker Change: EPCO-Ritamab is now the only T-cell-engaging bispecific approved in the U.S. and Europe to treat both follicular lymphoma and diffuse large B-cell lymphoma.
Speaker Change: Moving to neuroscience, we recently received FDA approval for Violev as the first subcutaneous 24-hour infusion of levodopa-based therapy for the treatment of motor fluctuations in adults with advanced Parkinson's disease.
Speaker Change: Our novel subcutaneous levodopa-carbidopa delivery system offers meaningful benefits over current treatment options and others that are in development.
Speaker Change: VIALEV delivers significant improvements in on-time and off-time with a non-surgical 24-hour delivery system.
Speaker Change: It can deliver high levodopa doses, similar to the amount provided by Duopa. And it doesn't require a combination with oral drugs to achieve efficacy.
Speaker Change: We're extremely excited to bring this transformative therapeutic option to patients in the U.S.
Speaker Change: We also recently announced positive top-line results from the Phase III Tempo I trial, which evaluated fixed doses of monotherapy tavapidon in early Parkinson's disease.
Speaker Change: In the study, both doses of tavapidone met the primary endpoint, demonstrating a significant reduction in the severity of Parkinson's disease symptoms compared with placebo at week 26.
Speaker Change: as measured by decreases in the combined scores for Parts 2 and 3 of the Unified Parkinson's Disease Rating Scale. Key secondary endpoints were also met in this study.
Speaker Change: We are very pleased with the emerging profile for tavapidon, which shows it is generally safe and well tolerated.
Speaker Change: And, it can drive strong efficacy as a monotherapy in early Parkinson's and as an adjunctive treatment in patients with more advanced disease.
Speaker Change: For more information visit www.FEMA.gov
Speaker Change: Results from the two Phase 3 studies thus far look favorable compared to other dopamine agonists on the market.
Speaker Change: And we believe Tavapidon has the potential to become an important new treatment option as a monotherapy for Parkinson's patients, as well as an adjunct to oral levocarbidopa.
Speaker Change: We expect to see results from Tempo 2 later this year, which is our Phase 3 monotherapy study evaluating a flexible dose of Tevapodone. Results from our long-term safety study, Tempo 4, are expected next year.
Speaker Change: As Rob mentioned, we remain on track to share data from the two emiraclidian pivotal studies in the fourth quarter.
Speaker Change: Thank you for watching!
Speaker Change: We also continue to invest in external innovation to strengthen our neuroscience pipeline.
Speaker Change: We recently announced two deals in this area, including an expanded collaboration with Gideon Richter to develop novel targets for neuropsychiatric conditions.
Speaker Change: And the acquisition of Aliata brings an antipyroglutamate A-beta antibody, which uses a unique blood-brain barrier crossing and amyloid aggregate clearing technology.
Speaker Change: Aliata's lead antibody has been able to achieve encouraging levels in cerebrospinal fluid with an extended half-life and the potential to be delivered subcutaneously. This molecule could become a best-in-class treatment for Alzheimer's disease.
Speaker Change: Aliata's novel technologies for enabling therapeutics to access the central nervous system also have the potential to be used with other programs across our neuroscience pipeline.
Speaker Change: In aesthetics, we recently received approval for Botox in the U.S. for moderate to severe platysma bands, marking the first global approval in this indication for any neurotoxin.
Speaker Change: There is currently a lack of non-surgical treatments available to improve the appearance of prominent platysma bands.
Speaker Change: And we believe Botox will represent an important new treatment option for patients who are looking to reduce the appearance of vertical neck bands and improve jawline definition.
Speaker Change: In our novel toxin portfolio, we remain on track to submit our regulatory application for Bonti around the end of this year.
Speaker Change: Our rapid-onset, short-acting toxin has a highly differentiated clinical profile, and once approved, will offer patients a novel option compared to currently available neurotoxins.
Speaker Change: Thank you. Thank you.
Speaker Change: So, in summary, this has been a very productive year thus far for our R&D organization, and we are pleased with the progress we've made advancing our broad pipeline.
Speaker Change: With that, I'll turn the call over to Scott.
Speaker Change: Thanks for watching!
Scott Reents: Thank you, Roopal. Starting with our third quarter results, we reported adjusted earnings per share of $3, which is $0.10 above our guidance midpoint. These results include a $0.04 unfavorable impact from acquired IPR&D expense.
Scott Reents: Total net revenues were nearly $14.5 billion, reflecting robust growth of 4.9% on an operational basis.
Scott Reents: excluding a 1.1% unfavorable impact from foreign exchange.
Scott Reents: Our Exhumera growth platform, which covers more than 80% of AbbVie's total sales, delivered reported growth of nearly 18%, once again exceeding our expectations.
Scott Reents: Thank you. Thank you. Thank you.
Scott Reents: The adjusted operating margin ratio was 46.7% of sales. This includes adjusted gross margin of 84.4%, adjusted R&D expense of 14.2%,
Scott Reents: acquired IPR&D expense of 0.6% and adjusted SG&A expense of 23%.
Scott Reents: Net interest expense was $591 million. The adjusted tax rate was 16.2 percent.
Scott Reents: Thank you for watching.
Scott Reents: and now expect adjusted earnings per share between $10.90 and $10.94.
Scott Reents: Please note that this guidance does not include an estimate for acquired IPR&D expense that may be incurred beyond the third quarter.
Scott Reents: We now expect total net revenues of approximately $56 billion, an increase of $500 million.
Scott Reents: At current rates, we expect foreign exchange to have a 0.7% unfavorable impact on full-year sales growth.
Scott Reents: This revenue forecast includes the following updates to select key products and therapeutic areas.
Scott Reents: We now approximate Skyrizzy global sales of $11.5 billion, an increase of $500 million due to continued strong performance across all approved indications.
Scott Reents: We invoke total revenue of $5.8 billion, an increase of $100 million, reflecting robust uptake in IBD.
Scott Reents: U.S. Humira total sales of $7.4 billion, a decrease of $400 million, reflecting more Humira molecule volume moving to other novel mechanisms, including Skyrizy and RINVOC.
Scott Reents: Thank you.
Scott Reents: Imbruvica total revenue of $3.3 billion, an increase of $200 million reflecting higher persistency rates for existing patients.
Scott Reents: Ben Kleksta, total sales of $2.6 billion, an increase of $100 million, reflecting momentum in both U.S. and international markets.
Scott Reents: Aesthetics' global revenue of $5.3 billion, a decrease of $200 million, almost entirely due to lower Juvederm volume, which continues to be impacted by challenging economic conditions in key markets.
Scott Reents: VRELAR total sales of $3.3 billion, a decrease of $100 million, reflecting continued strong prescription demand partially offset by modestly unfavorable channel mix.
Scott Reents: And for Botox, we now expect global revenue in the therapeutic space of $3.3 billion, an increase of $100 million, reflecting robust demand across all indications.
Scott Reents: Thank you.
Speaker Change: Moving to the P&L for 2024, we continue to forecast a full year adjusted gross margin of approximately 84% of sales.
Speaker Change: adjusted R&D investment of 14 percent.
Speaker Change: adjusted SG&A expense of 23.5 percent.
Speaker Change: as well as an adjusted operating margin ratio of roughly 44.5% of sales, which includes a 2.1% unfavorable impact from acquired IPR&D expense.
Speaker Change: Turning to the fourth quarter, we anticipate net revenues approaching $14.8 billion.
Speaker Change: At current rates, we expect foreign exchange to have a neutral impact on sales growth.
Speaker Change: Thank you for tuning in. I'm Chris Reents. We'll see you next time.
Speaker Change: We expect adjusted earnings per share between $2.94 and $2.98.
Speaker Change: This guidance does not include acquired IPR&D expense that may be incurred in the quarter and excludes any potential impact from the recently announced acquisition of Aliada Therapeutics.
Speaker Change: Thank you for watching. I'm Robert Reents. I'll see you next time.
Speaker Change: Finally, AbbVie's robust business performance continues to support our capital allocation priorities.
Speaker Change: Our cash balance at the end of September was nearly $7.3 billion, and we generated more than $11 billion of free cash flow, which includes approximately $1.5 billion of Sky Rizzy royalty payments in the first nine months of the year.
Speaker Change: This free cash flow fully supports a strong and growing quarterly dividend, which we are increasing 5.8% to $1.64 per share, beginning with a dividend payable in 2025.
Speaker Change: as well as debt repayment, where we remain on track to pay down the roughly $7 billion of maturities this year and anticipate achieving a net leverage ratio of two times by the end of 2026.
Speaker Change: Our strong cash flow also provides capacity for additional business development. We have executed more than a dozen early-stage deals so far this year, and we continue to assess external innovation across all of our key growth areas.
Speaker Change: In closing, Abbey has once again delivered strong top and bottom line results.
Speaker Change: I'm very pleased with the momentum of our Exhumeric Growth Platform, including continued robust performance from SkyRISE and RINVOKE, which further supports AVI's long-term outlook.
Speaker Change: With that, I'll turn the call back over to Liz.
Liz Shea: Thanks, Scott. We will now open the call for questions. We are aware of a peer earnings call that begins at 9 a.m. Central, so we will do our best to wrap up our Q&A right around the top of the hour. So in the interest of hearing from as many analysts as possible, please limit yourself to just one question. Operator, first question, please.
Speaker Change: Thank you. Our first question comes from Chris Schott with J.P. Morgan. Let me ask your question.
Chris Schott: Great, thanks so much for the question and congrats on the results. My question was really just centered around 2025 and just some preliminary outlook there. I guess some specific question, you mentioned Humira volumes are maybe shifting over to newer drugs.
Chris Schott: Can you comment at all about, just in terms of where the street sits currently with Humira? I think the consensus number is about 6.8 billion. Is that a reasonable forecast?
Chris Schott: That's something you could see higher erosion, given what's happening with Humira. And a bigger picture kind of tied to that, the mid-single digit top line growth, it sounds like the trends you're seeing here may be a net positive, where maybe Humira volumes are declining, but that's largely moving over to SkyRizzy and Renvo.
Speaker Change: to get some context of, is that mid-single-digit target still a reasonable one to think about for AbbVie next year? Thank you.
Rob Michael: Thanks for the question, Chris. This is Rob. I'll start and then I'll have Jeff supplement. So, yes, we are very confident in that robust mid-single-digit growth, both top-line, bottom-line.
Rob Michael: for 2025. I think you've interpreted correctly that the trends we're seeing are net positive.
Rob Michael: and that we're seeing over-performance from Skyrizzy and Rynvoke more than offsetting the dynamics with Humira and so as we look at consensus that's probably not reflected so I think it's fair to say.
Rob Michael: There's a shift that's required there, but we're very pleased with
Rob Michael: the strong uptake for Skyrizzy and Renbo, as I mentioned in my remarks.
Rob Michael: We have now delivered guidance increases of $1.3 billion for Sky RISD.
Rob Michael: and Renvoke in total. We're seeing tremendous momentum, particularly with the IBD indications across really all indications, but particularly in IBD. And we are starting to see this dynamic with the overall Humira molecule, where there is the switching that we're seeing now to other mechanisms, including Skyrazine and Renvoke, which is a long-term, very positive benefit. So, you know, as we look at the business, we're very well positioned.
Rob Michael: essentially two years after the U.S.-Humera LOE will be returning to a robust
Rob Michael: top-line and bottom-line growth.
Rob Michael: and really performance across many parts of the business, not just Sky Research, but you've seen us perform very nicely.
Rob Michael: in oncology. We've obviously overperformed our expectations in oncology.
Rob Michael: Very pleased with the earlier turns on Ellie here. Van Kleck is performing exceptionally well. The guidelines changes in Europe are positive as we think about the combination opportunities with BTK inhibitors. So Van Kleck is going to be strong. Epkinley is performing very nicely as well. And then when I look across the neuroscience...
Rob Michael: franchise. You know, Raylar is a strong grower. We're very pleased with the migraine portfolio, obviously very excited about Cerevil.
Rob Michael: and doing a number of deals now on the early pipeline both with Gideon Richter and Aliyada that really fortifies the long-term view for neuroscience as well. And then with aesthetics, while it's below our expectations for this year, obviously the economic conditions have dictated that. We still have tremendous confidence in the long-term outlook for that business.
Rob Michael: But as we look at 2025, we're very confident in our ability to return to that robust mid-single-digit growth.
Jeff Stewart: Yeah, thanks Rob, and I'll just add a little bit more flavor. It's Jeff. So we saw this trend start to emerge in terms of this compression of the, let's say, the atom molecule or the atom market that Humira plus biosimilars
Jeff Stewart: just prior to the CVS event and then it accelerated over Q2 and again, we saw it throughout Q3, so that's why we've adapted our approach here.
Jeff Stewart: Other than this dynamic, the biosimilar dynamics are playing out really exactly as we anticipated. And you can see this compression in the IQVIA data.
Speaker Change: Thank you.
Speaker Change: So really, the shrinking of the humera or the atom market is something that's quite clear. It's a little difficult to quantify over time with full precision, but we can see that the molecule continues to decline sequentially, and we continue to see strong share gains, as I highlighted for Skyrizzy and Rinvoke.
Speaker Change: This incremental flow from the molecule compression is clearly a contributing factor to some of the overperformance that we saw in Q2 and Q3, but it's really only one of several. We've also had significant incremental investments in the
Speaker Change: consumer space, the sales force approaches we've taken, Chris.
Speaker Change: the integration of the head-to-head data I talked about and certainly now we're starting to see the impact of the UC launch so when we when we put all that together we think that the dynamics are are net-net quite positive overall and as Rob said we're still we're still looking good for 25.
Speaker Change: Thank you, Chris. Operator, next question, please.
Speaker Change: Thank you. Our next question comes from Mohit Bansal. Your line is open. You may ask your question.
Mohit Bansal: Awesome. Thank you very much for taking that question. I just wanted to touch… Thank you. Thank you.
Mohit Bansal: upon the trial you are running head-to-head against Intivio. Could you help us understand, based on preclinical or early data, what gives you confidence there? And are you looking at non-inferiority or potential superiority over Intivio there? Thank you.
Mohit Bansal: Hey Mohad, it's Roopal. I'll take that one.
Roopal: So, when we look at the data, in particular, I think Jeff highlighted this, in ulcerative colitis with Skyrizzy, in this naive patient population, this is a patient population that hasn't seen biologics or other advanced therapies like JAK inhibitors.
Roopal: The endoscopic improvement, and this is in label, was 76% in the maintenance portion of this.
Roopal: So it was quite high, in fact, higher than what we've observed even with RINVOKE.
Roopal: So, that gave us a good amount of confidence that we have the potential to differentiate with all other assets. You heard about this guy Rizzi versus...
Roopal: used Echinomab head-to-head in Crohn's disease, but this one gives us a unique opportunity there to go head-to-head with Vetilizumab.
Roopal: especially looking at endoscopic improvement. So for that particular endpoint, you asked about the type of endpoint. There we would.
Roopal: Think about superiority
Roopal: because of it being an objective endpoint. Sometimes with symptoms like clinical remission, these could bounce around. That may be one where we consider as a non-inferiority, but I would say endoscopic improvements in the field are now believed to be highly predictive of long-term outcomes.
Roopal: So that would be how we're looking at this, Mohit.
Mohit Bansal: Thank you very much, appreciate it.
Mohit Bansal: Thanks, Mohit. Operator, next question, please.
Speaker Change: Thank you. And this question comes from Vamil Devon with Guggenheim Securities. You may ask your question.
Speaker Change: Thank you for watching. If you liked the video, please subscribe to the channel and click the like button. Also, I would appreciate it if you could share this video with your friends.
Speaker Change: Great, thanks for taking the questions, Yaki, which is one on MRAC, just getting a lot of questions from investors kind of leading up.
Speaker Change: for that data release, so maybe you can just sort of level set expectations on what you're hoping to see from the data, especially now that we have the approval.
Speaker Change: from Bristol with Copenhagen Puget and what are you thinking in terms of efficacy, safety, profile?
Speaker Change: relative to that competitor and also on the liver testing requirement that they had at initiation. That's something you'd expect as well based on your data and then just tie into that just in terms of the group.
Speaker Change: Data releases, do you expect to get one press release, or do you think you're combining both studies? Or should we still expect the two separate releases? Thank you.
Speaker Change: If I'm with Roopal, I'll take that one.
Speaker Change: So, a couple of things, maybe starting with...
Speaker Change: What we've observed with the approval. So we were encouraged by the lack of a boxed warning Meaning there's a recognition that this is a unique mechanism of action looking specifically at the muscarinic class
Speaker Change: So we were pleased to see that. I think what was notable for us was the GI adverse events.
Speaker Change: including how that would play out in terms of longer-term tolerability. Also, anti-cholinergic effects.
Speaker Change: Thank you. Thank you. Thank you.
Speaker Change: bladder retention. That was something I guess we did not anticipate.
Speaker Change: You mentioned hepatic monitoring.
Speaker Change: That was something that we didn't anticipate.
Speaker Change: The other thing that was notable is, along with the BID dosing,
Speaker Change: There is a food effect, so you have to wait a certain amount of time when you eat and after you eat when you can take the pill.
Speaker Change: So when we think about our profile
Speaker Change: We continue to be encouraged.
Speaker Change: With Imraq Ladeen being a single agent, once a day, no food effect, we don't see the extent of GI effects.
Speaker Change: We have not observed in the Phase 1b data any bladder issues. And when we had looked at that 1b data, we didn't see any hepatic issues, but we don't anticipate any type of laboratory monitoring.
Speaker Change: Also, we were also thinking about neurodegeneration-associated psychoses.
Speaker Change: and these patients are typically older and likely more sensitive to anticholinergic effects.
Speaker Change: So we continue to see an opportunity in that patient population as well.
Speaker Change: So we've stated that the data will read out here in the next couple months in the quarter
Speaker Change: Thank you.
Speaker Change: You know, the same team is working on wrapping up these two studies, so depending on how far apart the data are will probably determine.
Speaker Change: As you stated, is it one or two press releases? It's a little early right now for us to tell you is it going to be one or two. But if they're going to be close together, it's potentially going to be one.
Speaker Change: Thank you, Vamo. Operator, next question, please.
Speaker Change: Thank you. Our next question comes from Terrence Flynn with Morgan Stanley. You may ask your question.
Speaker Change: Hi, thanks for taking the question. Maybe a two part for me is just wondering if you can, I'm assuming contracting is now wrapped up, if you can comment at all on how to think about Skyrizzy and Rinvoke, formula positioning and pricing just high level for 2025. Thank you.
Speaker Change: Hi, it's Jeff. So yeah, contracting is very, very close to wrapping up. We have a few more nuances, and so typically that may take another month or so. Overall, we're making very good progress on contracting next year.
Speaker Change: of what we've highlighted in the past is we do not anticipate any material change for Sky Rizzy and Renvoke in terms of the access for next year across Medicare or the commercial plans. We have quite high, very broad access.
Speaker Change: and we assume that that will continue. In terms of what we've highlighted to anticipate...
Speaker Change: You know, we've said that we do have, over our near term in LRP, sort of a negative pricing environment, but it's modest. It's nothing like we saw, you know, many quarters ago where we had seven indications. So we said from a rebate perspective...
Speaker Change: You know, low single-digit changes is a reasonable assumption that we feel confident, and despite we're not fully complete, I think that's a fair assessment at this point.
Speaker Change: Thanks, Taryn. Operator, next question, please.
Speaker Change: Thank you. Our next question comes from Chris Trubitani with Goldman Sachs. You may ask your question.
Speaker Change: And Chris Shubitani, your line is open. You may ask your question.
Speaker Change: Apologies, that was on you. Thank you for the question. All the comments you've made about SkyReeseReInvoke and the molecule switching are very helpful. Just curious as we think on the forward about other potential mechanisms and modalities in particular. I think we have competitor oral data that's coming up. Interested to hear your thoughts in terms of that modality difference as well as, you know, how you might rank your optimism for some of the new mechanisms of action. I believe you have a TL1A as well in your pipeline, the earlier stage. Thank you.
Speaker Change: Thank you. Thank you.
Roopal: Hi Chris, it's Roopal, I'll take that one. With respect to the oral, I'll take us back to the Skyrizzy head-to-head that occurred with a primalast, which is also an oral.
Roopal: The data were substantially higher from an efficacy standpoint for SkyRISI, as was the tolerability, along with when we asked patients
Roopal: What did they prefer? They actually preferred quarterly subcutaneous dosing. So, I would think about it that way as well. Now, the question would be, it's a similar mechanism. Could the efficacy be better than what has been observed with a premolast in psoriasis?
Roopal: Well, what we saw in the phase 2 data, my recollection still is that Skyrizzy is a full 50% higher when it comes to full skin clearance at a PASI 100.
Roopal: And that's where the bar is now, at PASI 90 and PASI 100.
Roopal: The data I'm sharing are phase three.
Roopal: Sky RISD data.
Roopal: The data that we saw for the oral 23 was from phase 2, so there is reasonable potential that the efficacy data tend to settle down when you go to a broader patient population, especially those that have had longer standing disease or have seen other therapies like other biologics.
Roopal: So, we continue to feel very good and optimistic about our profile.
Roopal: versus any emerging competition. Also, we think about our assets from a global standpoint, and when you think about the majority of the countries, they are very driven by efficacy to gain access.
Roopal: And in the oral space...
Roopal: We don't really see it across the globe. Maybe there's a couple countries. I think Jeff has mentioned the US
Roopal: But that that space may be
Roopal: referred to as a pre-biologic space, so maybe more of an influence on the TIK2 or in a premolast is how we see it.
Roopal: In terms of other mechanisms that we like, as I mentioned, we like anti-L23, the way it's delivered with Skyrizzy.
Roopal: the depth of response, the high durability, and the convenience with quarterly dosing. If we can couple that with other assets as part of our combination approach, we think that's going to be extremely competitive in the future.
Roopal: Mechanisms like TL1A we think are gonna be important, especially from a combination approach, which we have one internally.
Roopal: We think the ulcerative colitis data are encouraging, but from a monotherapy standpoint, not differentiated, especially when you look at the SCIRISI data that I mentioned earlier and RENVOC.
Roopal: And then in Crohn's, something like TL1A, we think it really does need.
Roopal: So that will be part of our platform, along with our novel, Alpha 4 Beta 7. We think that's also a good combo.
Roopal: And then, we've also provided very strong data in hydradenitis supertiva with our IL-1-alpha-beta luteicizumab. And we've seen some preclinical signals.
Roopal: and one beta could be a driver of disease and resistance to other biologics.
Roopal: So Ludikizumab will also be part of the combo in our IBD platform. So that's just some of the mechanisms that we're excited about. There's several others that are early in the pipeline, and we will give you more information about those as the data mature.
Speaker Change: Thanks, Chris. Next question, please.
Speaker Change: Thank you. Our next question comes from Trang Nguyen with UBS. You may ask your question.
Speaker Change: Rob Reents, Robert Michael, Carrie Strom, Jeffrey Stewart, Richard Gonzalez, Elizabeth Shea, Roopal Thakkar, Richard Gonzalez, Elizabeth Shea, Richard
Speaker Change: and getting better quickly. So you've moderated your Juvederm outlook this year because it's not being good. If next year is another challenging economic year,
Speaker Change: Could we see that $9 billion in 2029 being moderated or even pulled? Just what's giving you confidence? Thank you.
Speaker Change: Thank you.
Rob Michael: Thanks for the question. This is Rob. I'll take that one. So, you know, as we think about the long-term guy, which is greater than nine billion
Rob Michael: by 2029, you need to believe that you can have
Rob Michael: If we look at the historical growth of this market, it's been, let's say, called low double digits, low teens. As we look at it going forward, we think a more prudent assumption is when we see the recovery, something more in the high single digits, right? So you need something beyond just the market recovery to get there. And when we look at the innovation that we're bringing, particularly with the
Rob Michael: Thank you.
Rob Michael: the short onset, short acting, or fast onset, short acting Bonti that we expect to launch in 26.
Rob Michael: That could really unlock a part of the market that's dormant right now, plus it could also lead to share gains. And so I think we need to see, one, how the market recovers, I would say, 25 and 26, and then ultimately see how the bond T launch ramps in 26.
Rob Michael: At that point, we'll have a better sense of, you know, the $9 billion as we sit here today. If you believe that the market will recover to high single digits, and we have a lot of confidence in Bonti, we still believe we can get there, which is why we're not updating that guidance. But I would expect us to reflect more on that, more likely in the 2026 timeframe than in 2025.
Speaker Change: Thanks, Trang. Operator, next question please.
Speaker Change: Thank you. Our next question comes from Jeff Meacham with Citi. You may ask your question.
Jeff Meacham: Good morning, everyone. Thanks for the question. I had a bigger picture one for Rob. So when I look at your therapeutic areas,
Jeff Meacham: You know, ICARE stands out as one that's pretty modest contributed today and also down the road. How would you rank that business strategically? And then related, when you look at BD going forward, are there other TAs that you're looking at that could be additive, just thinking specifically maybe metabolic or cardio? Thank you.
Jeff Meacham: Thank you for watching. I'm Robert Reents. I'll see you next time.
Rob Michael: Thanks for the question, Jeff. So this is Rob. So yeah, I mean, our main focus is our five key growth areas, which includes eye care, includes immunology, oncology, neuroscience, aesthetics, and eye care. And we, you know, we participate in large markets.
Rob Michael: with high unmet need that have great growth potential, and within those five verticals...
Rob Michael: You know, we're building depth across 24 core areas. That does include eye care as well, if you think about diabetic retinopathy, wet AMD, prescription dry eye medications, and so eye care does play an important role, albeit it's not as high of a growth driver as the other four verticals, but it is part of our five.
Rob Michael: And that ultimately guides both our internal R&D investments as well as our BD efforts, which, as you know, continue to be very active.
Rob Michael: So far this year, we've executed 15 deals along
Rob Michael: Those lines really focus more on early stage opportunities to drive growth in the next decade. So that's our primary focus.
Rob Michael: If we see an opportunity for differentiation in a large market with high unmet need, like metabolics, we would consider pursuing it.
Rob Michael: especially if it can help drive growth in the next decade. But again, it would be more opportunistic. We'd have to see differentiation, and right now it's not our primary focus. But again, you know, we're open to more sources of growth for the next decade if we see differentiation that we can create value. And we certainly have the financial wherewithal to pursue those opportunities.
Speaker Change: Thanks Jeff. Operator, next question please.
Speaker Change: Thank you. Our next question comes from James Chin with Deutsche Bank. You may ask your question.
James Chin: Good morning, guys. Thanks for taking our question. For MRAC and Dean's readout, I think there's a question on how much erosion could be anticipated. And I know you mentioned that the team, the same team that was originally working on the Phase I-B is wrapping up studies and so forth. But, you know, there's been some other data that has.
James Chin: copied some of Sarah Bell's strategies such as high baseline pans and so forth and placebo effect was still kind of surprisingly higher than it should be. Is there any insight on managing this placebo effect? Thank you.
James Chin: Thanks, James. It's Roopal. When we did our thorough diligence, that was a major question that we and the broader team had.
Speaker Change: So, you bring up a good point. Some things that we observed in those two studies that will be the pivotal readouts
Speaker Change: were what CERAVEL was strategically doing. One thing was limiting the number of countries, limiting the number of sites.
Speaker Change: Central Review for eligibility criteria, training of raters, certifying those raters, recertifying raters, monitoring blinded data with respect to site activity.
Speaker Change: So I think those are important factors that could drive placebo in either direction. So what we observed was, we would say, a good control, or at least the best one could do to manage placebo responses.
Speaker Change: So
Speaker Change: You know, it's hard to know if there's any erosion until we see the data.
Speaker Change: But the effect size that we did see in the Phase 1b...
Speaker Change: was a little over 12 points. But we think that was a strong separation, and even if that were to go down a little bit, we still feel that, based on the safety profile and tolerability profile,
Speaker Change: this could still be very very competitive even if we saw a droppage in some points on the efficacy side.
Speaker Change: Thanks, James. Operator, next question, please.
Speaker Change: Thank you. Our next question comes from Carter Gold with Barclays. Your line is open. You may ask your question.
Carter Gold: Good morning. Thanks for taking the questions. I was hoping to follow up a little bit on the Aliada acquisition.
Carter Gold: You know what differentiation you solve or some of the other enhanced brain Delivery kind of approaches there to give you confidence and maybe you know we've seen a baby take a number of shots on goal across Alzheimer's here just
Carter Gold: Seems pretty central to your longer term neuroscience portfolio Can you maybe just again put put that in some some broader context as you think about the TA strategy longer term? Thank you
Carter Gold: Sure, it's Roopal, I'll take that. Yes, we've been investing for a number of years in this space.
Carter Gold: And in addition to the recent deal, we'll have an option readout with Elektor and TREM2 coming up. We have a SV2A molecule that would look at cognition and other symptoms.
Carter Gold: M. raclidin could participate in that space from an Alzheimer's psychosis.
Carter Gold: standpoint. We have other pipeline assets that are looking at tau intracellular and even an approach looking at extracellular tau. We did have our own A-beta.
Speaker Change: Thank you.
Speaker Change: monotherapeutic antibody, which we did read out. It did look good, but it wasn't fully differentiated.
Speaker Change: and moving on to the Ali Ata deal.
Speaker Change: What we see there is the ability to access the CSF
Speaker Change: at what we would say at this stage, at higher concentrations than maybe other competitors. So we think that's a good thing. The other aspect that we like is an extended half-life.
Speaker Change: So that could lead to convenient dosing.
Speaker Change: And if this approach plays out, then one could consider having subcutaneous dosing.
Speaker Change: even getting out to monthly.
Speaker Change: And if the efficacy is high because of deeper brain penetration,
Speaker Change: For more information, visit www.FEMA.gov
Speaker Change: that could result in lower levels faster and a better able to see cognition benefits.
Speaker Change: in a year or 18 months.
Speaker Change: So, those are some of the benefits that we would see. The other benefit would be getting to the parenchymal tissue more broadly, and that could have a reduction in aria.
Speaker Change: which is is probably
Speaker Change: What is disallowing this to really take off? It's very challenging
Speaker Change: to take an elderly family member to get multiple scans.
Speaker Change: and worry about them having stroke-like symptoms. So that would be something else we believe we can address with this asset of having a strong safety profile, tolerability, ease of onboarding, and high efficacy and ultimately strong benefits on cognition.
Speaker Change: And this is Rob. I'll just add on here as we think about strategically about the neuroscience franchise. I mean I think about it as having really four main segments. You have psychiatry, migraine,
Speaker Change: Parkinson's, then neurodegeneration, and if you look at what we've done...
Speaker Change: to build out the long-term growth outlook for this franchise. Obviously, the psychiatry between Sara Volgidi and Richter. We also had the early stage opportunity with Gilgamesh, you know, really investing in longer-term growth in psychiatry. We have actually a very strong franchise in migraine with the oral CGRPs as well as Botox Therapeutic. In Parkinson's, now with the launch of Vialev, which is performing very nicely outside the U.S. and we expect will also perform nicely in the U.S.
Speaker Change: the early phase 3 data we've seen so far for Devapidon.
Speaker Change: The mitokinin disease modifying approach is early, and Parkinson's is another investment we've made.
Speaker Change: that we're interested in, that we have some partnerships that we'll continue to pursue. And so we see neuroscience as an important long-term growth driver for the company. We're obviously investing heavily across a number of areas, but we think about it really in those four categories, and so it's one that we're obviously very excited about the future prospects for.
Speaker Change: Thanks, Carter. Operator, next question, please.
Speaker Change: Thank you. And this question comes from Steve Scala with Cowen. You may ask your question.
Steve Scala: Thank you so much.
Steve Scala: I'm a bit surprised at how Cerovel was such a focus in the prepared remarks given the pending Imraq Ladeen data, which very much will color views of the Cerovel acquisition. Should we conclude you have increased confidence or insight into the pending data? And related to that, KOLs seem to be looking for an effect size of 0.6.
Steve Scala: But based on what was just said, that doesn't even seem to be a possibility. So, any thoughts would be appreciated. Thank you.
Speaker Change: Thank you. Thank you.
Rob Michael: This is Rob, and Roopal can take the second part of the question. I'll take the first part of the question. So Steve, in the prepared remarks, we were talking about the quarter. We obviously closed a terrible transaction in the quarter. That's a significant event.
Rob Michael: We also did see Phase 3 trial results for Tavapidon, so that was important to comment as well. As we've mentioned, we expect the two pivotals from raclidin to read out in the fourth quarter, so I wouldn't read too much into it other than it was an important event to highlight in the quarter.
Speaker Change: Yeah, and...
Speaker Change: It's Roopal. I agree. We have two positive phase three studies with Tavapidon and in the oral space, I don't know if we've seen a new mechanism.
Speaker Change: that could have this type of approach in a very long time. So it is important to discuss that because the unmet need continues to be very high and Parkinson's is a place where we believe we can meaningfully participate in.
Speaker Change: On the effect size question...
Speaker Change: You know, when we look at the 1B data, it was more than a 12-point differential.
Speaker Change: So
Speaker Change: We have observed sometimes a decrement and the question was around if placebo responses
Speaker Change: So that being said, we still think we can maintain a very strong
Speaker Change: effect size coupled with the safety profile. Remember that the issue here in therapy isn't just about efficacy, it's about maintaining these patients.
Speaker Change: on a drug that they can tolerate. And the majority of these patients don't last very long and cycle through these assets and even stop these, especially atypicals, without even letting their physicians know and then go on to have a.
Speaker Change: and end up in the hospital. So we think about this as a benefit, risk and tolerability profile. And from a weight, metabolic, motor symptoms, sedation, these are major problems with atypicals.
Speaker Change: And with something like Imraklidine, we feel that we can still fully differentiate. So I don't know if I'd read into any concerns other than...
Speaker Change: may be seeing an effect that's slightly different than what we saw in Phase 1B. But beyond that, we think this could still be very competitive.
Speaker Change: Please see the complete disclaimer at https://sites.google.com or at https://sites.google.com
Speaker Change: Thanks, Steve. Operator, we have time for one final question.
Speaker Change: Thank you. Our final question comes from Louisa Hector with Berenberg. You may ask your question.
Speaker Change: for joining us. Thank you. Thank you.
Louisa Hector: Hello, thanks for taking my question. Just on Vrela, could you expand a little on the comments of the channel mixed pressure in Q3 and how that will play out as we move forward? And perhaps just a quick comment on the extension of the collaboration with Gideon Richter and why you went down that route. Thank you.
Louisa Hector: Thank you.
Speaker Change: Scott, I'll take the question regarding Braylor. So it was, essentially it was a channel mix change. It was slight. I would tell you that really kind of had accumulated over the course of the year. And that's why we made, we decided it made sense to make the adjustment. So as that channel mix change, we saw a little bit of negative price as a result of that. So we took down.
Speaker Change: the very large guidance by a hundred million dollars. Now, I would note in neuroscience in totality that was offset by the raise in Botox therapeutics, so neuroscience and our therapeutic or growth area guide is stable.
Speaker Change: So maybe the second question, we'll go to Roopal. Yeah, we, it's Roopal. We expanded further. We've had strong partnership. They're a terrific organization. We have a follow-on to Braylor that's more D3 leaning.
Speaker Change: that will start entering the clinic.
Speaker Change: quite soon in Phase 2, looking at bipolar, depression, and MDD, as well as generalized anxiety disorder. As Rob described as part of our neuroscience strategy, psychiatry is a big part of that, and having a deeper relationship with Gideon Richter will allow us to have potentially even more assets.
Speaker Change: in depression, in bipolar disorder, in schizophrenia, and anxiety, and potentially other adjacent indications that we continue to be interested in because the unmet need continues to be very high.
Speaker Change: Thank you and thanks Shirley. That concludes our conference call today. If you'd like to listen to a replay of the call, please visit our website at investors.abbey.com. Thanks again for joining us.
Speaker Change: Thank you. Thank you. Thank you.
Speaker Change: Thank you and this concludes today's call. We thank you for your participation and at this time you may disconnect your lines.
Speaker Change: The chamber is in your hand. You are under arrest. YOU don't wear a gun. A gun is notarily prohibited. or Even if the shot is fired from a different gun, the gun dies.
Speaker Change: and many more. Thank you. Thank you.
Speaker Change: and many more. Thank you. Thank you.
Speaker Change: and many more. Thank you. Thank you.
Speaker Change: [music]
Speaker Change: Music Music Music Music Music Music Music Music Music Music
Speaker Change: Music Music Music Music Music Music Music
Speaker Change: [music]
Speaker Change: Good morning and thank you for standing by. Welcome to the AbbVie 3rd Quarter 2024 Earnings Conference Call. All participants will be able to listen only until the question and answer portion of this call. You may ask a question by pressing star 1 on your phone. Today's call is being recorded.
Speaker Change: I would now like to introduce Ms. Liz Shea, Senior Vice President, Investor Relations.
Liz Shea: Good morning, and thanks for joining us. Also on the call with me today are Rob Michael, Chief Executive Officer, Jeff Stewart, Executive Vice President, Chief Commercial Officer, Roopal Thakkar, Executive Vice President, Research and Development, Chief Scientific Officer, Scott Reents, Executive Vice President, Chief Financial Officer, and Carrie Strom, Senior Vice President, APPE, and President Global Allergan Aesthetics.
Liz Shea: Before we get started, I'll note that some statements we make today may be considered forward-looking statements based on our current expectations. AFI cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in our forward-looking statements.
Liz Shea: Additional information about these risks and uncertainties is included in our SEC filings. ABBY undertakes no obligation to update these forward-looking statements except as required by law.
Liz Shea: On today's conference call, non-GAAP financial measures will be used to help investors understand AbbVie's business performance. These non-GAAP financial measures are reconciled with comparable GAAP financial measures in our earnings release and regulatory filings from today, which can be found on our website.
Rob Michael: Following our prepared remarks, we'll take your questions, so with that, I'll turn the call over to Rob. Thank you, Liz. Good morning, everyone, and thank you for joining us.
Rob Michael: AbbVie is performing exceptionally well, and I'm extremely pleased with the execution against our strategic priorities, including continued double-digit sales growth from our ex-Humira platform, the closing and integration of Cerevil Therapeutics.
Rob Michael: and the progress we are making to build and advance a compelling pipeline of innovative medicines.
Rob Michael: Thank you. Thank you. Thank you.
Rob Michael: Turning to our results, AVI's diversified portfolio delivered sales that were $260 million above our expectations and reflect robust mid-single-digit operational sales growth.
Rob Michael: Our Exumera platform drove this overachievement, including growth of nearly 18 percent.
Rob Michael: The momentum of Skyrizzy and RuneVoke is especially impressive.
Rob Michael: With combined sales expected to exceed 17 billion dollars this year, which is 1.3 billion above our initial expectations. And we see substantial opportunity for continued strong growth well into the next decade.
Rob Michael: Several other key products also delivered double-digit sales growth, including BenClexta, Vraylar, Uprelvi, and Qlipta.
Rob Michael: Thank you for watching. I'll see you next time.
Speaker Change: This broad-based performance further demonstrates the strength of our commercial portfolio. For the third time this year, we are raising our full-year revenue and adjusted EPS guidance.
Speaker Change: We are increasing our full-year revenue guidance by $500 million and have now raised total revenue by $1.8 billion since our initial guidance in February.
Speaker Change: We are also raising our full-year adjusted earnings per share guidance by $0.15, and now expect adjusted EPS between $10.90 and $10.94.
Speaker Change: In addition to achieving strong quarterly results, we have been very focused on investing in the business to generate sustainable long-term performance in the 2030s and beyond.
Speaker Change: During the quarter, we successfully completed the acquisition of cerebral therapeutics, strengthening our neuroscience pipeline.
Speaker Change: Within the Cerevol pipeline, we are very pleased with the positive phase 3 results and emerging profile of tevapodon in Parkinson's.
Speaker Change: And we remain on track to read out both pivotal studies for emarcladine and schizophrenia in the fourth quarter.
Speaker Change: For more information, visit www.fema.gov
Speaker Change: More broadly on the pipeline, we have been advancing key R&D programs across all stages of development. Some notable highlights include the U.S. approvals of Violev for advanced Parkinson's and Botox for platysma bands.
Speaker Change: The U.S. regulatory submission of TELUSO-V for non-squamous, non-small cell lung cancer.
Speaker Change: and the start of our Phase 2 Crohn's platform study, which is evaluating SkyRISI in combination with several novel biologics.
Speaker Change: In summary, AVI continues to demonstrate strong commercial, operational, and R&D execution. The robust performance of our growth platform once again exceeded our expectations, and we see numerous opportunities to drive long-term growth.
Speaker Change: Further underscoring our confidence in that growth, today we announced a 5.8% increase in our quarterly cash dividend, beginning with the dividend payable in February 2025. Since inception, we have increased our quarterly dividend by more than 300%.
Speaker Change: With that, I'll turn the call over to Jeff for additional comments on our commercial highlights.
Jeff: Thank you, Rob. I'm extremely pleased with the continued strong momentum across the therapeutic portfolio. I'll start with the quarterly results for immunology, which delivered total revenues of more than $7 billion, up 4.8% on an operational basis.
Jeff: Skyrizzy global sales were $3.2 billion, up 51.5% on an operational basis, exceeding our expectations.
Jeff: We are seeing robust prescription growth across psoriatic disease, with Skyrizzy achieving in-play biologic share leadership in approximately now 30 key countries.
Jeff: In the U.S., we continue to capture nearly one out of every two in-place psoriatic disease patients on biologic therapy, and we see substantial room for further total share growth.
Jeff: We believe that Sky RISD's best-in-class profile, with nearly complete skin clearance, high durability of response, easy onboarding, and quarterly dosing for maintenance therapy, sets a very high bar relative to other therapies on market or in development.
Jeff: Guy Rizzi has also demonstrated a compelling clinical profile in IBD, including strong endoscopic data paired with convenient dosing.
Jeff: This differentiated profile, as well as our compelling head-to-head sequence data versus STELLARA, is supporting very rapid uptake in Crohn's disease.
Jeff: where Skyrizy continues to gain market share globally, achieving in-play patient leadership across all lines of therapy in the US, Japan, and Canada.
Jeff: DiRisi's U.S. in-play patient share is now approximately 32 percent, more than double the share of the second biologic treatment.
Jeff: And with Sky Rizzi's total prescription share of approximately 8%, we see significant opportunity for revenue inflection in Crohn's going forward.
Jeff: While we are still very early in our launch in the U.S. and Europe, we also anticipate robust uptake for SkyRIS-E in ulcerative colitis, the new indication.
Jeff: Initial prescription trends, as well as feedback from gastroenterologists, have been overwhelmingly positive.
Jeff: Physicians are particularly impressed with the data that has been demonstrated for naïve UC patients who have not been exposed yet to biologics, where SCIRIS-E achieved very high results for clinical remission and endoscopic response.
Jeff: We have now secured broad formulary access for SCIRISI and UC, with sales in this indication expected to ramp meaningfully over the next several quarters.
Jeff: So, given the momentum we are seeing across all of these indications, we will be raising our full-year sales guidance once again for Skyrizzy.
Jeff: Thank you. Thank you.
Speaker Change: Turning now to Renvo, which is also demonstrating robust growth. Global sales were $1.6 billion, up 47.4% on an operational basis.
Speaker Change: We continue to see strong prescription growth across all seven of Renvo's approved indications.
Speaker Change: I'm especially pleased with our performance in IBD where RINVOK's uptake is exceeding our expectations.
Speaker Change: Renvoke is now capturing double-digit in-play patient share in the U.S. for ulcerative colitis as well as Crohn's disease.
Speaker Change: Both indications are now available in more than 75 countries, with reimbursement and share continuing to increase.
Speaker Change: I also wanted to highlight our recent performance in atopic dermatitis, where Renvoke is seeing an acceleration of in-place share, following recent positive data from our second head-to-head study versus Dupixen.
Speaker Change: As an oral option that provides rapid skin clearance and itch relief, we believe Rinvoke's strong differentiated profile will continue to compete well in this highly underpenetrated AD market.
Speaker Change: As a result of this continued strong performance, we will also be increasing the full-year sales guidance once again for RINVOKE.
Speaker Change: Thank you for watching. I'm Jeff Reents. I'll see you next time.
Speaker Change: Additionally, we are making excellent progress with several new indications for RINVOC across sizable markets that will have the potential to provide another significant revenue inflection in the second half of this decade and into the 2030s.
Speaker Change: From a competitive perspective, a key element of Skyrizzy and Rynvoke's success has been their strong differentiation with compelling head-to-head data against several novel therapies. This includes Skyrizzy's superiority versus Humira, Cosentix, Otezla, and Stelara in psoriasis, as well as Stelara in Crohn's disease.
Speaker Change: and Renvogt's superiority versus Humira and Orencia in rheumatoid arthritis, as well as Dupixent in atopic dermatitis.
Speaker Change: To further support our differentiation, we have another head-to-head study ongoing for Skyrizi versus SOTIK2 in psoriasis, with plans also underway now for a study comparing Skyrizi versus Antivio in ulcerative colitis.
Speaker Change: So, given all of these factors, we feel very confident about the long-term growth prospects for both Skyrizzy and RenVogue.
Speaker Change: Thank you. Thank you. Thank you.
Speaker Change: Turning now to Humira, which delivered global sales of $2.2 billion, down 36.5% on an operational basis due to biosimilar competition.
Speaker Change: While Humira's share erosion to biosimilars in the U.S. is largely in line with our expectations, we are now seeing more Humira molecule volume moving to other novel mechanisms than previously anticipated.
Speaker Change: So, while this has an unfavorable impact to Humira sales, we are seeing a benefit to Skyrizzy and Rinvoke, which is a very favorable dynamic for immunology portfolio now and certainly over the long term.
Speaker Change: Thank you. Thank you.
Speaker Change: Moving now to oncology, where total revenues were approximately $1.7 billion. Imbruvica global revenues were $828 million, down 8.8 percent, reflecting continued competitive dynamics in CLL, partially offset by higher persistency rates for existing patients.
Speaker Change: Venklexta is performing extremely well. Global sales were $677 million, up 18.2% on an operational basis.
Speaker Change: This reflects strong momentum in CLL, especially in Europe, where recent guideline changes recommend combination use of Venclexta plus BTK inhibitors as a preferred fixed-duration treatment versus continuous BTK treatment alone.
Speaker Change: Growth is also supported by our very strong share position in frontline AML, where BenClexa is the leading treatment for patients who are ineligible for intensive induction chemotherapy.