Morningstar | ABBV Updated Forecasts and Estimates from 18 Mar 2019
Along with fourth-quarter results that largely met our expectations and slightly underperformed consensus expectations, AbbVie provided 2019 guidance slightly below our projections. We don't expect any meaningful change in our fair value estimate, however. AbbVie's 2019 guidance for oncology drug Venclexta and endometriosis drug Orilissa is slightly behind our projections, but we continue to expect both drugs will develop into major sales contributors with 2022 sales estimates of $3 billion and $900 million, respectively. Also, increased generic competition to testosterone therapy AndroGel will weigh on 2019. However, our sales decline of 30% expected for Humira internationally due to biosimilars is in line with management's guidance. Despite these headwinds in 2019, AbbVie is reasonably well positioned with new drugs to mitigate most of the generic pressures affecting Humira over the long term, supporting our narrow moat rating. However, we lack conviction to award a wide moat rating, given the higher level of uncertainty in offsetting generic Humira pressures, as the drug represents close to 60% of total sales.In the quarter, international Humira sales fell 15% year over year, and we expect this decline to accelerate in 2019 to 30%. We expect Humira to face further price and volume erosion in 2020 of close to 20%. By 2021, we expect biosimilars to launch in the remaining 25% of international countries, which should lead to our projected decline of 30%. We expect the largest generic headwind in 2023, when biosimilars are likely to enter the United States.
AbbVie is launching several new drugs that should help mitigate Humira biosimilar pressures. We expect major blockbuster potential for immunology drugs risankizumab and upadacitinib, both of which should launch in 2019. Further, currently launched hematology drugs Imbruvica and Venclexta should grow significantly based on new indications and excellent efficacy.
For a complete review of AbbVie's pipeline and currently marketed portfolio, please see "Annual Drug Pipeline Report: Moats Remain Secure as Innovation Counters Pricing and Generic Headwinds, but M&A Accelerating."
AbbVie is a research-based biopharmaceutical company. The company's products are focused on treating conditions such as chronic autoimmune diseases in rheumatology, gastroenterology and dermatology; oncology, including blood cancers; virology, including hepatitis C virus and human immunodeficiency virus; neurological disorders, such as Parkinson's disease; metabolic diseases, including thyroid disease and complications associated with cystic fibrosis; pain associated with endometriosis; as well as other serious health conditions. The company also has medicines in clinical development across immunology, oncology and neuroscience, with additional targeted investment in cystic fibrosis and women's health.
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