AbbVie (ABBV) expects its biggest drug, Humira, to hit peak international sales in 2018 and then face erosion as cheaper biosimilars enter the market, an analyst said Tuesday.
But UBS analyst Marc Goodman kept his buy rating and 73 price target on AbbVie stock, which closed up 0.6% at 65.84 on the stock market today, back above its 50-day line.
Humira is facing biosimilar competition outside the U.S. where price declines are about 2% per year, Goodman wrote in a note to clients. Outside the U.S. remains a volume-driven business whereas in the U.S. AbbVie has more pricing leeway.
As competition erodes Humira sales outside the U.S., AbbVie plans to curtail sales and marketing spending in specific countries "commensurate with sales erosion," Goodman said following a meeting with AbbVie executives during the UBS Global Healthcare Conference.
After hitting peak outside-U.S. sales in 2018, AbbVie expects 15% sales erosion each year through 2020.
IBD'S TAKE: First-quarter earnings just wrapped for a number of drugmakers, including AbbVie. Visit IBD's Technology page for a closer look at who outperformed and who fell behind.
Meanwhile, it will push its mid- to late-stage pipeline including elagolix, which is being developed with Neurocrine Biosciences (NBIX) to treat endometriosis and uterine fibroids. AbbVie is on track to file an application with the Food and Drug Administration for elagolix in endometriosis in the third quarter.
AbbVie is also looking at its drug Venclexta in combinations with FDA-approved Rituxan and Johnson & Johnson (JNJ) and Pharmacyclics' (PCYC) Imbruvica in leukemia and lymphoma. Longer term, it has growth opportunities in other forms of lymphoma and leukemia, Goodman wrote in a note to clients.
RELATED:
Regeneron, Sanofi Undercut Amgen, AbbVie In Rheumatoid Arthritis
AbbVie Loses Key Humira Patent In Battle With Small-Cap Biotech
