Abbott results bode well for spun-off AbbVie
(Reuters) - AbbVie Inc (ABBV.N), the new branded pharmaceuticals company spun off by Abbott Laboratories Inc (ABT.N), is off to a good start, judging by fourth-quarter sales of arthritis drug Humira and other products in its medicine chest.
The picture, although healthy, could be more challenging for the remaining Abbott, nicknamed "new Abbott," which continues to sell medical devices, diagnostics, nutritional products and generic drugs, said analysts.
The new Abbott said it expects earnings for 2013, excluding special items, of $1.98 to $2.04 per share, in line with its earlier guidance and above the average Wall Street forecast of $1.95.
Although the company has not yet provided complete earnings data for full-year 2012, it said the mid-point of its 2013 profit forecast would likely represent double-digit earnings growth. But Abbott is still analyzing its numbers because of the split and may eventually restate some figures, analysts said.
A big worry, according to Leerink Swann analyst Danielle Antalffy, is whether Abbott can revive sales of its branded generic medicines, which the company calls established pharmaceuticals. Sales of the products slipped 4 percent in 2012 to $5.1 billion. Abbott predicted they would capture mid-single-digit growth this year, excluding the impact of foreign exchange rates.
"The business, which represents 25 percent of company sales, has been underperforming," Antalffy said, adding that revenue forecasts for the business are difficult because they rely on data from so many local markets and countries.
Fourth-quarter sales of all products that remain with Abbott were $5.7 billion, roughly in line with analysts' forecasts. Although the company did not provide comparable sales figures for the fourth quarter of 2011, Antalffy estimated sales rose 4 to 5 percent in the most recent quarter.
Analysts said trends for AbbVie, based on more-detailed data for its products provided by Abbott on Wednesday, were easier to interpret.
Global sales of branded drugs that now belong to AbbVie rose 7.4 percent to $5.14 billion in the fourth quarter, topping the $4.8 billion estimate of Wells Fargo analyst Larry Biegelsen. The rise would have been 8.5 percent if not for the stronger dollar, which lowers the value of sales in overseas markets.
Sales of Humira, by far AbbVie's biggest product, jumped 23 percent to $2.68 billion, about $200 million above Biegelsen's estimate.
That represented a marked acceleration of sales growth from the prior two quarters and underscores how reliant AbbVie is on the injectable product, which is expected to become the world's top-selling medicine this year.
AbbVie, spun off by Abbott earlier this month, is expected to report its interpretation of the fourth-quarter results and its 2013 forecast on January 30.
Among top product lines still sold by Abbott, sales of nutritional brands jumped 10.2 percent to $1.71 billion in the fourth quarter, and sales of laboratory diagnostics grew 3.8 percent to $908 million. Sales of diabetes care products rose 3.1 percent to $362 million, reversing a 10 percent decline seen in the prior quarter.
Abbott shares closed down 0.3 percent, while AbbVie shares climbed 3.8 percent, both on the New York Stock Exchange.
(Reporting By Ransdell Pierson; editing by John Wallace; editing by Carol Bishopric)
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