AbbVie profit beats estimates on surging Humira sales
(Reuters) - AbbVie Inc, which last week announced plans to buy Dublin-based drugmaker Shire Plc for $55 billion, reported stronger-than-expected quarterly earnings on surging sales of its Humira treatment for rheumatoid arthritis.
Second-quarter sales rose 5 percent to $4.93 billion, topping Wall Street expectations of $4.7 billion. The gains were mostly due to Humira, an injectable treatment whose global sales jumped 26 percent to $3.29 billion, AbbVie said on Friday.
Jefferies analyst Jeffrey Holford said Humira sales were $350 million above expectations, and he affirmed his rating of AbbVie as the top global pick in the pharmaceutical industry.
"The scale of the Humira beat will surprise all," Holford said. But he noted that numerous other AbbVie products fell short in the quarter, including the Androgel testosterone drug, Kaletra medicine for HIV, and Lupron treatment for prostate cancer.
Humira, the world's top-selling drug, now accounts for 67 percent of AbbVie's sales. Reliance on the medicine by the suburban Chicago company is a main reason it sought out Shire, which has an array of lucrative treatments for rare diseases.
After buying Shire, AbbVie plans to locate the combined company in Britain, where taxes are lower. The maneuver, called tax inversion, is being used by many U.S. companies, especially drugmakers, and has come under fire from President Barack Obama and some members of Congress.
Humira sales were especially strong in the United States, where they rose 36 percent, helped by retail buying patterns.
But Humira will take a breather in the third quarter, AbbVie predicted, with its U.S. sales growth tapering to the "high teens" percentage range.
Humira, approved in 2002 to treat rheumatoid arthritis, is also used to treat other inflammatory conditions.
Although Humira's U.S. patent lapses in late 2016, AbbVie has said it will take years for other drugmakers to develop and win approval for their own versions.
Besides buying Shire, AbbVie is trying to lessen its dependence on Humira by attempting to develop treatments for hepatitis C, cancer and other diseases.
AbbVie said it had earned $1.1 billion, or 68 cents per share, in the second quarter, compared with $1.07 billion, or 66 cents per share, a year earlier.
Excluding writedowns and other special items, AbbVie earned 82 cents per share. Analysts on average expected 76 cents, according to Thomson Reuters I/B/E/S.
The company's effective tax rate in the quarter was 22.2 percent. AbbVie said it expects its tax rate to drop to the 13 percent range by 2016, after its completes its acquisition of Shire.
AbbVie said it still expected full-year earnings of $3.06 to $3.16 per share, excluding special items. It forecast third-quarter earnings of 77 cents to 79 cents per share, which is in line with the Thomson Reuters forecast of 77 cents.
AbbVie shares were down 1.7 percent at $53.18 in afternoon trading.
(Reporting by Ransdell Pierson; Editing by Jeffrey Benkoe and Lisa Von Ahn; Editing by Diane Craft)