(Bloomberg) -- Robert Michael, just the second chief executive officer in AbbVie Inc.’s corporate history, got his tenure started on the right foot: a beat and a raise.
The North Chicago, Illinois-based drugmaker said it will earn more than originally forecast during Michael’s first year at the helm as newer medicines help ease its dependence on Humira, the blockbuster autoimmune drug that defined it for more than a decade.
Investors cheered the news. Shares rose as much as 5.6% in New York to a record in the company’s nearly 12-year history. They had increased about 14% this year through Wednesday’s close.
“As we begin this new chapter, nearly every aspect of AbbVie’s business is performing at our above expectations,” Michael, the company’s former chief financial officer, said during the second-quarter earnings conference call. He took the reins July 1.
Adjusted earnings for the year will be between $10.71 and $10.91 a share, the company said in a statement, an increase of 10 cents at the midpoint from the company’s prior guidance. Second-quarter earnings per share and revenue beat Wall Street’s expectations.
“Despite investor concerns about Humira erosion, commercial execution remains rock steady,” BMO analyst Evan Seigerman wrote in a note to investors.
Filling the Gap
The company is counting on a crop of newer medicines to fill the gap left by shrinking sales of Humira, which lost patent protection last year and now faces competition from lower-cost biosimilar drugs. Skyrizi and Rinvoq, two AbbVie medicines approved for autoimmune diseases including arthritis, have brought in billions in revenue, and the company expects recent acquisitions in oncology and neuroscience to eventually yield more blockbusters.
Combined sales of Skyrizi and Rinvoq reached $4.16 billion in the second quarter, above the average Wall Street estimate of $3.95 billion. AbbVie raised its full-year forecast for the two medicines by about $200 million combined. Humira sales were $2.8 billion, matching analysts’ projections. Once the world’s best-selling medicine, Humira’s sales have dramatically declined with the US debut of cheaper alternatives, led by a biosimilar from Sandoz Group AG.
AbbVie expects to close its $8.7 billion acquisition of the neuroscience company Cerevel Therapeutics as early as next week, Michael said on a conference call with analysts. The deal, announced late last year, had previously drawn scrutiny from the US Federal Trade Commission.
AbbVie’s adjusted earnings for the second quarter were $2.65 a share, while analysts expected $2.56. Both figures reflect a previously disclosed charge of 52 cents a share related to recent acquisitions and licensing deals.
The quarter is AbbVie’s first since the departure of Richard Gonzalez, who led the company as CEO after its spinoff from Abbott Laboratories that was announced in 2012.
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