AbbVie’s top executive team has looked to the near future — and it is a fine and cheery place unhampered by generics or pricing pledges.
CEO Rick Gonzalez, CFO Bill Chase and CSO Michael Severino sat down with Leerink’s Geoffrey Porges for a 90-minute discussion about the company, giving them a chance to outline a bullish scenario for the next few years — which includes some jaw-dropping forecasts for its franchise drug Humira as well as its two top drugs in the late-stage pipeline.
In Porges’ telling of the meeting, the AbbVie $ABBV team believes it has cleared a thicket of potential biosimilar competition to Humira, giving them a clear and open market pathway that stretches out to 2022 as the company beefs up its peak revenue to $20 billion. And they are mighty fond of two of their top experimental drugs — ABT-494/upadacitinib and the anti-IL-23 anti-inflammatory drug risankizumab — each of which could spawn franchise sales of $4 billion to $5 billion.
AbbVie paid Boehringer $595 million upfront to license rights to risankizumab in early 2016 and now see it as a core piece of a future $30 billion immunology franchise.
Also, after starting the year with President Donald Trump trumpeting his opposition to outrageous drug pricing, they’re finishing it confident that nothing going on in Washington DC — or anywhere in the US healthcare system — threatens their rosy scenario.
In the meantime, the company appears increasingly confident about the domestic contracting, pricing, and regulatory environment, suggesting that its “one price increase per year” commitment applies only to 2017 and could be revisited in 2018.
Gonzalez started the year with a presentation at JPMorgan that included a promise to limit annual price hikes to single digits, capping it at just under 10% with once-off increases — instead of steadily upping the ante with staggered price hikes — as the pharma industry grappled with severe criticism that spurred a number of companies to make a public pledge to rein in the big increases that inflated franchise revenue.
“There’s a strong debate going on right now about pricing,” Gonzalez told investors, according to a Reuters report at the time. “We need to make sure we are operating in an appropriate way … and demonstrating the value of the products that we have.”
We’ll see soon enough if the 2017 pledge goes any further than 2017.
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