TEXT-S&P rates AbbVie commercial paper program 'A-1'
Dec 6 - Standard & Poor's Ratings Services said today that it assigned its 'A-1' short-term rating to North Chicago, Ill.-based AbbVie Inc.'s $2 billion 4(2) commercial paper program. Proceeds are to be used for general corporate purposes which may include partially funding a net cash distribution of $13.2 billion to parent Abbott Laboratories. The ratings reflect our expectation that U.S. pharmaceutical company AbbVie's key product, arthritis treatment Humira, will continue to grow through both additional uses and the expanding pool of patients. Although AbbVie's pipeline is modest for a company of this size, it does benefit from some promising prospects that could provide top-line growth in the longer term. Our view of the business risk profile as "strong" is underpinned by this combination of a defensible, highly profitable business with a high dependence on a single product. We also expect that cash flows after capital spending and dividends of about $2.5 billion in each of the next two years will enable the company to rapidly reduce leverage. The leverage improvement, if sustained, could be sufficient to improve a currently "modest" financial risk profile to "minimal," and support a ratings upgrade. RELATED CRITERIA AND RESEARCH -- Business Risk/Financial Risk Matrix Expanded, Sept. 18, 2012 -- Liquidity Descriptors For Global Corporate Issuers, Sept. 28, 2011 -- 2008 Corporate Criteria: Analytical Methodology, April 15, 2008 -- 2008 Corporate Criteria: Rating Each Issue, April 15, 2008 -- 2008 Corporate Criteria: Ratios And Adjustments, April 15, 2008 RATINGS LIST AbbVie Inc. Corporate credit rating A/Positive/A-1 Rating Assigned $2 billion commercial paper A-1 Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.