AbbVie Q4 2024 Earnings Report

CorMedix EPS Results

• Actual EPS: $2.16
• Consensus EPS: $2.98
• Beat/Miss: Missed by -$0.82
• One Year Ago EPS: $2.79

CorMedix Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $14.81 billion
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

CorMedix Announcement Details

• Quarter: Q4 2024
• Date: 1/31/2025
• Time: Before Market Opens
• Conference Call Date: Friday, January 31, 2025
• Conference Call Time: 9:00AM ET

CorMedix (NASDAQ:CRMD), a biopharmaceutical company, focuses on developing and commercializing therapeutic products for the prevention and treatment of infectious and inflammatory diseases in the United States. Its lead product candidate is DefenCath, an antimicrobial catheter lock solution to reduce the incidence of catheter-related bloodstream infections in adult patients with kidney failure. The company was formerly known as Picton Holding Company, Inc. and changed its name to CorMedix, Inc. in January 2007. CorMedix Inc. was incorporated in 2006 and is based in Berkeley Heights, New Jersey.

CorMedix Q4 2024 Earnings Call Transcript

Presentation

[Operator]

Good morning and thank you for standing by. Welcome to the Advi Fourth Quarter twenty twenty four Earnings Conference Call. All participants will be in a listen only mode until the question and answer portion of this call. You may ask a question by pressing star 1 on your phone. Today's call is also being recorded.

[Operator]

If you have any objections, you may disconnect at this time. I would now like to introduce Ms. Liz Shea, Senior Vice President of Investor Relations. Ma'am, you may begin.

[Liz Shea, Senior VP - IR at AbbVie]

Thank you. Good morning and thanks for joining us. Also on the call with me today are Rob Michael, Chief Executive Officer Jeff Stewart, Executive Vice President, Chief Commercial Officer Rupal Thacker, Executive Vice President, Research and Development, Chief Scientific Officer Scott Rentz, Executive Vice President, Chief Financial Officer and Carrie Strom, Senior Vice President, Appy and President, Global Allergan Aesthetics. Before we get started, I'll note that some statements we make today may be considered forward looking statements based on our current expectations. AbbVie cautions that these forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in our forward looking statements.

[Liz Shea, Senior VP - IR at AbbVie]

Additional information about these risks and uncertainties is included in our SEC filings. AbbVie undertakes no obligation to update these forward looking statements except as required by law. On today's conference call, non GAAP financial measures will be used to help investors understand AbbVie's business performance. These non GAAP financial measures are reconciled with comparable GAAP financial measures in our earnings release and regulatory filings from today, which can be found on our website. Following our prepared remarks, we'll take your questions.

[Liz Shea, Senior VP - IR at AbbVie]

So with that, I'll turn the call over to Rob.

[Robert Michael, CEO at AbbVie]

Thank you, Liz. Good morning, everyone, and thank you for joining us. Our performance closes out another excellent year for AbbVie, and I am very pleased with the significant progress we made in 2024. We executed on our top commercial priorities, advanced our pipeline with key regulatory approvals and promising data, and further strengthened our business through strategic transactions. Turning to our results.

[Robert Michael, CEO at AbbVie]

We delivered full year adjusted earnings per share of 10.12 which is $0,.49 above our initial guidance midpoint, excluding the impact of IPR and D expense. Total net revenues were $5,630,000,000,0.0 exceeding our initial guidance by more than $2,000,000,000 Our results demonstrate a rapid return to sales growth with full year revenue up 4.6% on an operational basis despite $5,000,000,000 of U. S. HUMIRA erosion in 2024. This outstanding execution is driven by our ex HUMIRA platform, which continues to outperform expectations, delivering full year sales growth of more than 18% with revenue growth accelerating to 22% in the As I look to 2025 and beyond, we are well positioned with our ex HUMIRA platform.

[Robert Michael, CEO at AbbVie]

It will allow AbbVie to deliver robust mid single digit revenue growth in 2025 and exceed our previous peak revenue in just the second year following The U. S. HUMIRA LOE. And given that we have no significant LOE events for the rest of this decade, we have a clear runway to growth for at least the next eight years, including a high single digit revenue CAGR through 2029. We anticipate a substantial portion of this growth will be driven by robust performance from SKYRIZI and RINVOC.

[Robert Michael, CEO at AbbVie]

These 2 assets are expected to collectively generate nearly $24,000,000,000 of revenue in 2025, reflecting growth of more than $6,000,000,000 Based on this strong momentum, we now expect SKYRIZI and RINVOK to exceed more than $31,000,000,000 of combined sales in 2027, which is $4,000,000,000 above the guidance we provided last year. We are seeing strong performance across all of their approved indications, especially in IBD. And we see several tailwinds that will support growth into the next decade, including healthy immunology market growth, strong share capture given best in class profiles, continued robust market access and momentum from new indications, such as the recent launch of SKYRIZI in UC as well as the potential for 5 new indications for RINVOC over the next few years. In neuroscience, our second largest therapeutic area, we are seeing very robust performance with sales of $10,000,000,000 expected in 2025, reflecting growth of $1,000,000,000 across psychiatry, migraine and Parkinson's. In oncology, I am very encouraged by our long term growth prospects.

[Robert Michael, CEO at AbbVie]

This includes our BCL2 inhibitor, VENCLEXTA our FR alpha ADC for ovarian cancer, ELEHIR our 2 novel C MET ADCs for solid tumors TELUSO V and 400 and our BCMA CD3 bispecific for multiple myeloma three eighty three. Lastly, while the recent performance in aesthetics has been impacted by challenging market conditions in The U. S. And China, the category remains very attractive given low penetration rates for facial injectables. When the market returns to more normalized growth, our leading commercial portfolio and forthcoming pipeline will help drive improved performance.

[Robert Michael, CEO at AbbVie]

Based on the market trends over the last few years and our assumption for a gradual recovery in the near term, we now expect aesthetics to deliver a high single digit revenue CAGR through 2029. Turning now to R and D, we have made excellent progress with our late stage programs. These advancements include recent approvals for SKYRIZI and UC, Epkinley and later lines of follicular lymphoma, Elihir for FR alpha positive platinum resistant ovarian cancer Violev for advanced Parkinson's and new indications for BOTOX and Juvederm. In 2025, we anticipate approvals for RINVOC and GCA and TELISOV for non squamous, non small cell lung cancer as well as regulatory submissions for tivapidone in Parkinson's, VENCLEXTA in higher risk MDS and BONTI for aesthetics. We have also added depth to our pipeline by signing more than 20 early stage deals since the beginning including promising technologies and innovative mechanisms that can elevate the standard of care in immunology, oncology and neuroscience.

[Robert Michael, CEO at AbbVie]

We have significant capacity to continue pursuing external innovation with a focus on differentiated opportunities that can drive growth in the next decade. In summary, I am very pleased with AbbVie's execution in 2024 and expect our diverse portfolio to drive strong growth in 2025 and beyond. With that, I'll turn the call over to Jeff for additional comments on our commercial highlights. Jeff?

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Thank you, Rob. I'll start with the quarterly results for Immunology, which delivered total revenues of approximately $730,000,000,0.0 exceeding our expectations. SKYRIZI total sales were nearly $380,000,000,0.0 reflecting operational growth of 57.9%. RINVOG total sales were more than $180,000,000,0.0 reflecting operational growth of 47.1. On a full year basis, Gyresia and RINVOC delivered approximately $1,770,000,000,0.0 in total combined revenue, an impressive increase of nearly $6,000,000,000 year over year, exceeding our expectations.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

These results reflect strong performance across all approved indications. I'll share some highlights in The U. S. SKYRIZI total prescription share in the biologic psoriasis market is now approximately 40%, reflecting a very significant lead relative to all major competitors with in play capture rates remaining very strong. Over the course of 2025, we anticipate new data for SKYRIZI on hard to treat areas of the body, including scalp and genital psoriasis.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

In addition, we expect the readout of our fifth head to head study in psoriasis comparing SKYRIZI to SOTIK2, which will continue to differentiate the brand versus oral competitors. RINVOC is now capturing more than 20% in play share in atopic dermatitis as our communication around our LEVEL UP study versus Dupixent continues to ramp. Recall that in LevelUp, we showed strong comparative results on stringent endpoints of skin resolution and itch reduction. In RA, RINVOC is achieving the leading in play share in the second line plus market consistent with the brand's label. We see that U.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

S. Physicians are increasingly utilizing only 1 TNF prior to initiating RINVOG treatment in RA. In psoriatic arthritis, SKYRIZI and RINVOG together are capturing a leading in play share in the room category, highlighting the effective co positioning of both agents in this important segment. Across IBD, SKYRIZI and RINVOC are also capturing portfolio share given their respective efficacy, safety and dosing profiles. In Crohn's disease, which is roughly 2 thirds of the overall IBD market, these 2 treatments together are capturing approximately half of the in place share with total prescription volumes ramping very rapidly.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

In ulcerative colitis, we are seeing a very strong inflection following the SKYRIZI launch in the Both SKYRIZI and RINVOC together are already capturing roughly a third of the UC in play market, which supports robust momentum going forward for both AbbVie brands. We see similar performance internationally as well, where SKYRIZI and RINVOC are also achieving leadership positions across our major countries. So I'm very pleased with this momentum and continue to see a significant opportunity for share gains across our existing indications in addition to the typical market growth we see across Room, Durham and Gastro in 2025 and beyond. Turning now to HUMIRA, which delivered global sales of more than $160,000,000,0.0 down 48.7% on an operational basis, primarily due to biosimilar competition. We continue to see molecule compression in The U.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

S. With volume moving to other novel mechanisms, which has resulted in a benefit to both SKYRIZI and RINVOC. We anticipate HUMIRA access will decrease throughout 2025 as more plans move to exclusive biosimilar contracts. It's reasonable to assume that roughly half of U. S.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Covered lives will continue to have parity access to HUMIRA on a full year basis with select exclusionary contracts for existing patients expected to begin around the middle of the year. Moving now to oncology, where total revenues were approximately $170,000,000,0.0 IMBRUVICA global revenues were eight forty eight million dollars down 6.2%, reflecting continued competitive dynamics in CLL. VENCLEXTA global sales were $6.55,000,000 dollars up 13% on an operational basis, reflecting strong demand for both CLL and AML across our key countries. Lastly, Eluir continues to demonstrate a strong launch trajectory for FR alpha positive platinum resistant ovarian cancer with global sales of $148,000,000 Sales in The U. S.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Are annualizing at more than $600,000,000 and commercialization is now underway in key international markets where we are accelerating regulatory and reimbursement timelines. Moving to neuroscience, where total full year revenues were $9,000,000,000 reflecting impressive absolute sales growth of nearly $130,000,000,0.0 In the quarter, total revenues were $250,000,000,0.0 up 19.9% on an operational basis. This robust performance is driven by continued double digit growth of RAYLAR with global sales of $9.24,000,000 dollars BOTOX Therapeutic with global revenues of $8.73,000,000 dollars UBrelvi with global sales of $3.00 $3,000,000 and Culipta with global revenues of $2.00 $1,000,000 Beyond these leading therapies for psychiatry and migraine, we are very excited for an emerging portfolio in Parkinson's disease. We recently launched Violev, the only subcutaneous twenty four hour continuous infusion of levodopa based therapy for the treatment of advanced Parkinson's disease. As a less invasive non surgical delivery system that can provide meaningful improvements in on time and off time, we are seeing very high interest from both physicians and patient communities.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Parkinson's experts report significant benefit from the continuous twenty four hour delivery and the control of symptoms morning, day and through the night. While sales in The U. S. Are expected to ramp gradually over the next several quarters as we work to establish the appropriate Medicare coverage and benefit determination, uptake internationally is exceeding our expectations. Finally, I'm very encouraged by the data we are seeing for tavapadon for potential use as a monotherapy for early Parkinson's disease as well as an adjunct to optimize oral therapy for more advanced patients.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

The Vapadon represents a very complementary addition to our Parkinson's disease portfolio with Violev and DUOPA. So overall, I'm extremely pleased with the commercial execution across our therapeutic portfolio, which is demonstrating very strong momentum as we head into 2025. With that, I'll turn the call over to Carrie for additional comments on aesthetics. Carrie?

[Carrie Strom, Senior VP at AbbVie]

Thank you, Jeff. Fourth quarter global aesthetic sales were approximately $130,000,000,0.0 reflecting an operational decrease of 4.4%. In The U. S, aesthetic sales of $8.39,000,000 dollars declined 5% as challenging market conditions and promotional dynamics impacted key assets. Consistent with recent quarters, The U.

[Carrie Strom, Senior VP at AbbVie]

S. Facial injectable market continues to be affected by suppressed consumer spending that is related to the cumulative impact of high inflation over several years. As a higher price procedure relative to toxins, current conditions are most notably impacting the filler market, which declined by approximately 10% in the quarter. The toxin market remains more resilient, demonstrating low single digit percent growth. Although we continue to be the clear market leader in toxins and fillers, in our facial injectable share declined by a few points.

[Carrie Strom, Senior VP at AbbVie]

In Oct. 0, we launched an updated version of our Ally consumer loyalty program, which was designed to benefit providers by increasing treatment frequency, patient retention and cross selling. While some providers embrace the new loyalty program, many felt the new construct was too complex to integrate into their practices, therefore negatively impacting market share and inventory levels. Based on this market reaction, we reinstated our original Ally consumer loyalty program earlier this month. This action has been met with a rapid and favorable response from our providers with encouraging early indicators for sales and market share recoveries.

[Carrie Strom, Senior VP at AbbVie]

Internationally, aesthetics sales were $4.59,000,000 dollars This represented an operational decline of 3.2% that was primarily due to lower Juvederm sales as BOTOX cosmetics sales were roughly flat on an operational basis. Our international results were impacted by our second largest global market, China, where lower consumer spending related to economic headwinds continues to affect performance. Looking to 2025, we've planned prudently with our outlook for modest aesthetic sales growth. In The U. S, this reflects a gradual improvement in market growth rates and share for both toxins and fillers.

[Carrie Strom, Senior VP at AbbVie]

Additionally, based on our Ali loyalty program changes, we expect a 1 time price adjustment to negatively impact our results. Internationally, we are focused on retaining a strong competitive position as we launch multiple new products in China, while we closely monitor market conditions and consumer sentiment. In summary, while economic headwinds in key geographies have created a near term impact on market conditions, we continue to see significant long term growth potential given high consumer interest and low penetration rates. Allergan Aesthetics is uniquely positioned to benefit based on our customer relationships, commercial investments and innovative pipeline. With that, I'll turn the call over to Rupal.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

Thank you, Carrie. We continue to make significant progress with our R and D efforts to advance novel clinical programs across all stages of our diversified pipeline. In 2025, we expect a strong cadence of important data readouts, regulatory submissions and new approvals, as well as many clinical trial starts for key programs. Starting with immunology, regulatory applications are under review for RINVOC and GCA with approval decisions anticipated in the Data for 2 Phase 3 RINVOC programs will be available this year, alopecia areata and vitiligo, and for our HS and lupus programs in 2026. Moving to SKYRIZI, data from the head to head in psoriasis versus OTIC2 will be available this year.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

Also this year, to further support differentiation in IBD, a study comparing SKYRIZI to ENTYVIO in ulcerative colitis will be initiated. Additional mid stage monotherapy and combination studies are planned in 2025, including a Phase 2 study evaluating ludekizumab in atopic dermatitis a Phase 2 study evaluating SKYRIZI and ludekizumab in psoriatic arthritis and advancement of our anti TREM1 antibody, ABBV8736 with the eventual goal to add it to the Crohn's disease platform study as a monotherapy and in combination with SKYRIZI. Moving to oncology, where multiple regulatory and clinical milestones as well as phase transitions for key programs are planned. 1 area that we are particularly excited about is our ADC pipeline, where several assets are aimed at multiple tumor types. Our regulatory application is under review for accelerated approval of TALISO V as a monotherapy in patients with previously treated c Met overexpressing eGFR wild type non squamous non small cell lung cancer.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

The target for an approval decision is in the year. This represents a segment of lung cancer with high unmet need, where patients have limited options and tend to have a very poor prognosis. If approved, VILISOV would be the first C MET directed ADC for the treatment of non small cell lung cancer. We are also rapidly advancing our next gen C MET asset. A Phase 3 study evaluating ABBV400, also known as tmAb A, was recently initiated in patients with cMET overexpressed refractory metastatic colorectal cancer.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

TmAb A as a monotherapy is being compared against chemotherapy plus bevacizumab. This year, data from a Phase 1 CRC study evaluating TmAb A in combination with bevacizumab could enable a Phase 3 study in an all comers population. TmAb A is also progressing well across lung programs. A Phase 2 study in eGFR wild type non small cell lung cancer is being planned, where TMAb A will be evaluated with a PD-one inhibitor as a frontline combination therapy. In the eGFR mutant segment, results from the ongoing Phase 1 study could enable tmAb A dose optimization studies as a monotherapy in the second line setting and in combination with osimertinib in the first line setting.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

In gastroesophageal cancer, a Phase 2 trial was recently started evaluating TmAb A in combination with chemotherapy and a PD-one inhibitor in frontline patients. We are also excited about ABBV706, an ADC that utilizes the same topo warhead and linker technology as TmAb A, but with an antibody that targets SES6. Encouraging data in small lung cancer, small cell lung cancer were presented at ASCO last year. And this year dose optimization and longer term duration data will be available. This readout could lead to the initiation of a registrational study in second line and dose optimization in combination with standard of care in the front line.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

Moving to FR alpha ADCs. Elohire is now approved for platinum resistant ovarian cancer in The U. S. And Europe and is currently in Phase III development for the platinum sensitive ovarian cancer segment. Also, a next generation ADC targeting FR alpha, IMGN-one 51, is currently in Phase 1.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

This year, Elohir will be tested in combination with bevacizumab and a PARP inhibitor. One hundred and fifty one is being advanced into dose optimization as well as in studies with standard of care agents such as bevacizumab, carboplatin and a PARP inhibitor. These mid stage studies for ELOHIR and 151 will be used to inform our Phase III approach in various settings for ovarian cancer, including induction and maintenance in platinum sensitive patients and in combination for frontline maintenance. Another ADC from ImmunoGen known as PIVEC targets a rare hematologic malignancy called Blastic plasmacytoid dendritic cell neoplasm. Based on positive data from the pivotal Phase II study, a regulatory application is planned for later this year.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

If approved, this would be an important new treatment option for patients with this aggressive blood cancer. Also in the area of hematologic oncology, the Phase III VENCLEXTA MDS study is nearing completion with an overall survival data readout later this year. Now moving to neuroscience. Following the imacclidine and POWER-one and 2 study readouts, a thorough analysis of the data was conducted to better understand the placebo effect observed in the 2 trials. Our findings point to a lack of uniformity of placebo effect across sites.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

When assessing sites beyond those with high placebo response, a clear efficacy signal was observed, albeit more modest than reported in Phase 1b. Therefore, we see a path forward as an adjunct to atypicals and schizophrenia and as a monotherapy in psychosis related to Alzheimer's and Parkinson's. These are diseases where there is a high unmet need for safe and tolerable treatments that can provide even a modest benefit. Additionally, our intention is to explore higher doses of imraclidine. This is based on the degree of variability observed in the PK data from the EMPOWUR study.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

If higher doses are found to be safe and well tolerated, there is a potential opportunity to evaluate imracludine as a monotherapy in schizophrenia as higher doses may result in greater efficacy. A multiple ascending dose study will be conducted this year and data will be available in the early Following this dosing work, Phase 2 studies in adjunctive schizophrenia and potentially monotherapy schizophrenia will be initiated. Dose ranging in elderly patients is ongoing with Phase 2 studies planned in 2026 in patients with psychosis related to Alzheimer's and Parkinson's disease. Staying on the topic of Parkinson's disease, positive top line results from the third Phase 3 trial for tivapidone were recently announced. In the TEMPO-two trial, tivapidone met the primary endpoint demonstrating a significant reduction in the severity of Parkinson's disease symptoms compared with placebo at week twenty six.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

Key secondary endpoints were also achieved. We are very pleased with the emerging profile for tivapidone, which shows strong efficacy as a monotherapy and as an add on to levocarbidopa. The six month data from the Phase 3 studies show tivapidone to be generally safe and well tolerated with low rates of adverse events of special interest, such as sedation and impulse control disorder. Longer term safety data will be available this year and regulatory submissions will then follow. Moving to aesthetics.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

We met with the FDA late last year regarding our BONTI submission for the treatment of glabellar lines. We are in the process of generating additional CMC data requested by the agency, which should be completed in the next few months. The regulatory submission will likely occur around the middle of the year. To summarize, there have been significant advancements across all stages of our pipeline. In 2025, we anticipate numerous important regulatory and clinical milestones, including many trial starts for key programs.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

With that, I'll turn the call over to Scott.

[Scott Reents, Executive VP & CFO at AbbVie]

Thank you, Rupal. Starting with our results, we reported adjusted earnings per share of $2,.16 which is $0,.08 above our guidance midpoint. These results include an $0,.88 unfavorable impact from acquired IP R and D expense. Total net revenues were $1,510,000,000,0.0 reflecting robust growth of 6.1% on an operational basis, excluding a 0.5% unfavorable impact from foreign exchange. Our ex HUMIRA platform delivered reported growth of 22%, once again exceeding our expectations.

[Scott Reents, Executive VP & CFO at AbbVie]

Adjusted gross margin was 83.8% of sales, adjusted R and D expense was 15.1% of sales and adjusted SG and A expense was 23.6% of sales. The adjusted operating margin ratio was 34.7% of sales, which includes a 10.4% unfavorable impact from acquired IP R and D expense. Net interest expense was $6.10,000,000 dollars The adjusted tax rate was 20.2%. Turning to our financial outlook for 2025. Our full year adjusted earnings per share guidance is between $12,.12 and $12,.32 Please note that this guidance does not include an estimate for acquired IPR and D expense that may be incurred throughout the year.

[Scott Reents, Executive VP & CFO at AbbVie]

We expect total net revenues of approximately $59,000,000,000 reflecting robust operational growth of 5.7% despite a roughly 4% net unfavorable impact across our portfolio from the Medicare Part D benefit redesign. At current rates, we expect foreign exchange to have a 1% unfavorable impact on full year sales growth. This revenue forecast contemplates the following approximate assumptions for select key products and therapeutic areas. We expect global immunology sales of $2,940,000,000,0.0 including SKYRIZI revenue of $1,590,000,000,0.0 reflecting growth of more than $410,000,000,0.0 driven by continued strong performance in psoriasis as well as robust uptake in IBD RINVOC sales of $790,000,000,0.0 reflecting growth of nearly $2,000,000,000 with continued market growth and share momentum across all approved indications. And HUMIRA total revenue of $560,000,000,0.0 including U.

[Scott Reents, Executive VP & CFO at AbbVie]

S. Sales of $4,000,000,000 as more plans exclude branded HUMIRA around the middle of the year. This forecast includes a $600,000,000 net unfavorable impact from the Medicare Part D benefit redesign. In oncology, we expect global sales of $630,000,000,0.0 including IMBRUVICA revenue of $270,000,000,0.0 dollars which reflects a $400,000,000 net unfavorable impact from the Medicare Part D benefit redesign VENCLEXTA sales of $260,000,000,0.0 reflecting continued strong demand partially offset by a $100,000,000 net unfavorable impact from Medicare Part D benefit redesign and elder here revenue of $7.50,000,000 dollars For Aesthetics, we expect global sales of 5300000000.0 reflecting gradual improvement in market conditions across global markets as well as market share recovery in The U. S.

[Scott Reents, Executive VP & CFO at AbbVie]

This includes BOTOX Cosmetic revenue of $280,000,000,0.0 and relatively flat sales for JUVEDER. For neuroscience, we expect global sales of $10,000,000,000 reflecting continued double digit growth. This includes: Bralar revenue of $350,000,000,0.0 reflecting continued strong prescription demand, partially offset by a $200,000,000 net unfavorable impact from the Medicare Part D benefit redesign. BOTOX Therapeutics sales of $350,000,000,0.0 total oral CGRP revenue of $210,000,000,0.0 and VioLEV sales of $300,000,000 For eye care, we expect global sales of $220,000,000,0.0 Moving to the P and L for 2025, we are forecasting full year adjusted gross margin of approximately 84 of sales, adjusted R and D investment of approximately 14.5%, adjusted SG and A expense of approximately $1,320,000,000,0.0 and an adjusted operating margin ratio of roughly 47% of sales. We expect adjusted net interest expense of approximately 2600000000.0 which primarily reflects the annualized financing costs for the ImmunoGen and Cerevel transactions.

[Scott Reents, Executive VP & CFO at AbbVie]

We forecast our non GAAP tax rate to be approximately 15.6%. Finally, we expect our share count to be roughly flat to twenty twenty four. Turning to the we anticipate net revenues of approximately $1,280,000,000,0.0 At current rates, we expect foreign exchange to have a 1.6% unfavorable impact on sales growth. This revenue forecast comprehends the following approximate assumptions for our key therapeutic areas: Immunology sales of $610,000,000,0.0 including SKYRIZI sales of $320,000,000,0.0 and RINVOK revenue of $160,000,000,0.0 We expect U. S.

[Scott Reents, Executive VP & CFO at AbbVie]

HUMIRA sales of $900,000,000 We also anticipate oncology revenue of $150,000,000,0.0 aesthetic sales of $110,000,000,0.0 which includes an unfavorable 1 time price adjustment due to the reimplementation of the original Ali program. Neuroscience revenue of $210,000,000,0.0 and eye care sales of $5.50,000,000 dollars We are forecasting an operating margin ratio of roughly 44.5% of sales and model a non GAAP tax rate of approximately 13.8%. We expect adjusted earnings per share between $2,.47 and $2,.51 This guidance does not include acquired IPR and D expense that may be incurred in the quarter. Finally, AbbVie's robust business performance continues to support our capital allocation priorities. Our cash balance at the December, was approximately $550,000,000,0.0 and we expect to generate free cash flow approaching $17,000,000,000 in 2025, which includes roughly $270,000,000,0.0 of SkyRISY royalty payments.

[Scott Reents, Executive VP & CFO at AbbVie]

This free cash flow will support a strong and growing quarterly dividend, which we have increased by 310% since inception, as well as debt repayment, where we expect to pay down nearly $3,000,000,000 of total debt this year and remain on track to achieve a net leverage ratio of 2 times by the Our strong cash flow also provides capacity for continued business development to further augment our portfolio. In closing, we are pleased with AbbVie's results in 2024 and our financial outlook remains very strong. We have considerable momentum across our diverse portfolio and we continue to be well positioned to deliver robust growth in 2025 and beyond. With that, I'll turn the call back over to Liz.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Scott. We will now open the call for questions. In the interest of hearing from as many analysts as possible over the remainder of the call, we ask that you please limit your questions to 1 or 2. Operator, first question please.

[Operator]

Our first question comes from Vamil Divan with Guggenheim Securities. Your line is open.

[Vamil Divan, Managing Director & Senior Research Analyst at Guggenheim Securities, LLC]

Great. Thanks for taking the question. So maybe just to dive a little deeper on this category, the windmill comp has a great performance and guidance. Can you just comment a little more on pricing dynamics that you're seeing there and sort of how you factored in pricing both for this year and maybe over the next several years? And then just a quick follow-up on the comments that were given around aesthetics, especially on the share side.

[Vamil Divan, Managing Director & Senior Research Analyst at Guggenheim Securities, LLC]

I think you lost a few points, but maybe getting it back. Can you just give a sense of where you think the share is now for BOTOX and JUBIRDSURM sort of this point in time? Thank you.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Thanks, Vamil. It's Jeff. And I'll comment on SKYRIZI and RINVOG. And I think we've been very consistent that over the near term and over time, this is a volume based business. So we're going to see price declines year over year.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

But I would say modest, right? We've sort of highlighted that as we negotiate the formularies, we've started to consistently see sort of these low single digit price concessions. Now obviously, what Scott highlighted was unique for the twenty five year with the Part D redesign that he outlined. So overall, consistent low single digit price declines from the rebating side with a 1 time Part D. And we would anticipate once we lap the Part D, we would see that sort of trend going forward.

[Robert Michael, CEO at AbbVie]

And, Val, this is Rob. I'll just add that if you think about SKYRIZI and RINVOC, our strategy here was to elevate the standard of care for patients and ultimately would drive a rapid return to growth for the company beyond HUMIRA. And that's exactly we've been able to execute. That strategy has played out. You see the differentiation in the marketplace.

[Robert Michael, CEO at AbbVie]

We have 9 head to head studies. We're launching a few more. We've upgraded our guidance now by additional $4,000,000,000 in 2027. We've been very consistent in our language around the pricing dynamics. We said, when you think about rebates, think about it as negative low single digits going forward.

[Robert Michael, CEO at AbbVie]

But given the robust performance of these assets, it's volume that's dominating the growth and we would expect that to continue.

[Carrie Strom, Senior VP at AbbVie]

And hi, this is Carrie. I'll answer your question around, BOTOX and Juvederm share. So in The U. S, we remain the clear market leader for both toxins and fillers. In a few points of share erosion bringing BOTOX to around the low to mid-60s, JUVEDERM to around the low to mid-40s.

[Carrie Strom, Senior VP at AbbVie]

As I said, the reversion of the loyalty program back to the original 1, which we announced in Dec. 0 and then put into action Jan. 21, was greeted with very positive response from our customers and, encouraging signs for us to recapture that share for both BOTOX and Juvederm throughout the year. And just to note that the share did not go to 1 competitor rather it was more distributed amongst the entire competitive set.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Vamil. Operator, next question please.

[Operator]

Yes. Our next question comes from Chris Schott with JPMorgan. Your line is open.

[Chris Schott, Managing Director at JP Morgan]

Great. Thanks so much. Just a 2 parter on the Skyraiser invoke dynamics. Maybe just first on the 2027 guidance, can you just elaborate on what were the biggest drivers of upside to those targets as you think about the various indications for the drugs? Is it fair to think most of this coming from IVD or is it across the board?

[Chris Schott, Managing Director at JP Morgan]

And then probably a longer term question on those brands. Can you just elaborate a little bit more on how we should think about the growth rate beyond 2027? So, obviously, how mature will these franchises be by then? And what type of growth rates can we think about over time? Thank you.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Yes, maybe thanks, Chris. It's Jeff. I'll start on that. So the primary driver of the change is in fact share capture. So the pricing assumptions have been consistent.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

We can call the markets pretty well. We see the actuals and the long term trends there. So it's been really share capture. And I would say that we see it across the board. Certainly, we've been super encouraged with SKYRIZI and psoriasis.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

We consider to see very, very robust TRx share trends. And there's no question that the ramps in IBD have been very, very significant. So that's a big piece of it, but I would say it's across the board. So predominantly share, capture. I don't know if Scott, you have anything to add, but that's the big dynamic there on the $4,000,000,000

[Scott Reents, Executive VP & CFO at AbbVie]

Yes, Jeff, maybe Chris, it will be helpful. I can give you the breakdown by indication between the 2 on the 2027 guide. So we talked about $31,000,000,000 combined in 2027, that's our new long term guidance. That is $11,000,000,000 for RINVOC and $20,000,000,000 for SKYRIZI. RINVOC is broken down, ROOM is about 4.8, Dermatology 2 point 5, IBD 3 point 7 billion dollars And then on the SKYRIZI side, $1,250,000,000,0.0 of that $20,000,000,000 guide is from psoriatic and the remaining $750,000,000,0.0 is coming from IBD.

[Scott Reents, Executive VP & CFO at AbbVie]

So that might help you kind of see those where the growth is coming from as well.

[Robert Michael, CEO at AbbVie]

And if we speak to it in terms of the $4,000,000,000 just to give you a sense then to add to what just Scott mentioned, so SKYRIZI was up $3,000,000,000 1 billion dollars of that is psoriatic and $2,000,000,000 is IBD. We're just seeing tremendous ramps early days with IBD. And then for RINVOC, it's up $1,000,000,000 from the previous guidance and that's a mix of roughly $300,000,000 room, $200,000,000 derm and $500,000,000 IBD. So again, across the board, we're seeing tremendous performance, particularly in IBD. And then your question on how to think about the growth, we have obviously given guidance beyond $27,000,000 but as I look at the sell side consensus, clearly, the growth that's in sell side consensus beyond 27% is below our expectations.

[Robert Michael, CEO at AbbVie]

We would expect to see these markets continue to grow. We would also expect to see continued share gains, albeit as you start getting close to that in place share level, the share curve bends, but still you still expect to see some level of share growth. And then keep in mind, we will have the 5 we expect the 5 new indications for RINVOC, collectively adding about $2,000,000,000 in peak sales. And so that will also contribute. So as I think about the rate of growth for SKYRIZI and RINVOC beyond $27,000,000,000, RINVOC will likely grow faster than SKYRIZI because of those new indications, but you'll still see a robust performance from both assets at least through '32

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Chris. Operator, next question please.

[Operator]

Our next question comes from Jeff Meacham with Citigroup. Your line is open.

[Geoff Meacham, Managing Director at Citi]

Hey, guys. Good morning. Thanks so much for the question. Just had a couple. First one on CeraVeil, you guys called out the partial impairment today

[Geoff Meacham, Managing Director at Citi]

and the press release. Just want

[Geoff Meacham, Managing Director at Citi]

to get your perspective as to what the drivers are for the remaining value, assuming tavapidone is mostly it, but wasn't sure what you'd assume for imacludine or backup compounds. And then just on aesthetics, with the new guidance to 2029, is it fair to say that you think $25,000,000 could be the trough or have already seen a trough in terms of the growth rate? I'm just trying to think of the longer term picture. And then just on VONTI, I wanted to get your perspective about the potential success there adding new patients to the paradigm, just given the potential there? Thank you.

[Robert Michael, CEO at AbbVie]

Jeff, on your first question regarding this is Rob on your first question regarding Cerevel. So keep in mind, the accounting rules do not allow you to write up an intangible. So even though we are more optimistic about tivapidon now than we were at the time of the deal, we can't write that value up. So that would be the same as what we originally described. We still, obviously, as Rupal walked you through the development programs for imraclidine, still see opportunity in adjunctive schizophrenia as well as neurodegenerative psychosis.

[Robert Michael, CEO at AbbVie]

And we haven't completely given up on the monotherapy opportunity either, but that's a more heavily risk adjusted opportunity now. So when you think about, the value you have to take into account, the timing, so there is some level of time delay as well as a different probability of success for monotherapy, that's all baked into because you're essentially valuing risk adjusted revenues, you have to take that into account. That said, we're still optimistic about the asset. We're pursuing it in these indications. And again, as I mentioned, we haven't completely given up on monotherapy.

[Robert Michael, CEO at AbbVie]

That will depend on dose ranging. But that is the way, we constructed the revaluation of the intangible. But overall, we still see a very nice opportunity, particularly for tibapidone and we still see potential from raclodine as well.

[Scott Reents, Executive VP & CFO at AbbVie]

Jeff, I'll take your question regarding the aesthetics trough. So we've not specifically guided that, but the way that we have modeled it and think about it is we do see recovery and I think the big headwind here has been over the last two years has been the economic condition. So we do see continued improvement. Carrie spoke about some of the market growth rates that we're seeing coming back in The U. S.

[Scott Reents, Executive VP & CFO at AbbVie]

For both fillers and toxins. So we would if you model, you would anticipate '25 to be the trough. And then our long term guidance is that high single digit compound annual growth using '25 as the base year through '29. And if you model that, that's going to put you somewhere north of $7,000,000,000 Certainly, this is a business we continue to be excited about. We think that there are continuing to be low market penetration rates globally frankly and we've got some innovation to continue to drive market growth.

[Scott Reents, Executive VP & CFO at AbbVie]

That market has grown low double digits historically, but I think as we model we're thinking a high single digit growth in the markets, but we do see some growth accelerators with Bontea and maybe I'll let the team talk about Bontea.

[Robert Michael, CEO at AbbVie]

Maybe I'll just mention here just more broadly, this is Rob, on the business. I think as you reflect on the aesthetics performance and we are just going through a period of macroeconomic pressure on that business. But we do continue to see an attractive long term setup, again, given low penetration rates, high consumer interest and our leading portfolio, including some exciting pipeline programs in toxins and fillers. When you think about it, as part of AbbVie, the Aesthetics business has been able to continue investing despite the macroeconomic challenges and that will allow us to maximize opportunities when the market does recover. We have set up this business to be a global fully integrated unit with dedicated support from R and D and business development and I'm confident that focused approach will pay off in the long run.

[Robert Michael, CEO at AbbVie]

It's just been difficult for us to call the market recovery, but we still have a lot of confidence in the long term outlook.

[Carrie Strom, Senior VP at AbbVie]

And this is Carrie. I'll comment on BONTI. So as you said, BONTI will be an important catalyst for new patient activation into the category. Consideration continues to be very high for aesthetics and for toxins. And like we said, it continues to be under penetrated.

[Carrie Strom, Senior VP at AbbVie]

And that's because there continue to be barriers for these people who are interested in the category, but not acting around costs and concerns of an unnatural look. And that's really where Bontea will play an important role based on its unique profile that is suited to address these concerns. It's fast acting. It has short duration. So, it's going to be a nice option to position for these considerors to try, Bonte.

[Carrie Strom, Senior VP at AbbVie]

And then our commercial strategy will be to convert them from Bontea to BOTOX. So, this is going to be an important pipeline catalyst to help us to activate that consumer market and drive more consumers into the toxin category for BOTOX.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

And it's Rupal. Maybe 1 comment to add to Carrie's. On the R and D side, even thinking past that this year, we'll initiate a study with BONTI plus BOTOX to cover people immediately and get that long term benefit. So those studies will start this year.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Jeff. Operator, next question please.

[Operator]

Our next question comes from Terence Flynn with Morgan Stanley. Your line is open.

[Terence Flynn, Equity Research Analyst at Morgan Stanley]

Hi. Thanks for taking the questions. You mentioned the net impact of the Part D redesign. Can you tell us what the volume impacts you guys are assuming, if any, in that calculation? And then the second question I had is on the pipeline slide, you noted you could have some Phase II UC data for 01/13, which I believe is your oral and Rx1 agonist.

[Terence Flynn, Equity Research Analyst at Morgan Stanley]

Just maybe speak to conviction level there and how you think about that on the forward and if that would be something you could move into Phase III? Thank you.

[Scott Reents, Executive VP & CFO at AbbVie]

Terrence, it's Scott. I'll take your question on the volume. So we have guided to 4% of a net impact across the business for headwind to growth for Part D redesign. Now when we think about that volume offset, we've not quantified that in the guidance, but that is part of the 4%. It's I would say in the Grand scheme, it's a fairly modest offset overall.

[Scott Reents, Executive VP & CFO at AbbVie]

And I think part of what you need to do when you think about that volume, recognize that when you look at the patient segments that exist, there's roughly 3 patient segments and they each take about a third of the business. But this is really something that will impact the standard eligible and we're working very hard to ensure that people are electing Cap and Smooth. And so we really see that volume offset coming from that one third of the patient segment to drive that. And so that's why I think it's a little bit more of a modest offset, but we've not quantified it.

[Robert Michael, CEO at AbbVie]

And it's logical when you think about it because the other 2 thirds, I mean, you have the LIS population, which is one third. So they don't have an out of pocket burden like the standard eligible do. And then the other third are covered by employer plans, where again, they don't have the same out of pocket burden. So when we analyzed it, we looked at the market and saw that about a third, as Scott mentioned, of the population would benefit from the lower out of pocket. But keep in mind, the cost share applies to the entire book of Medicare business.

[Robert Michael, CEO at AbbVie]

That's why the volume doesn't offset the price impact.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

And this is Rupal. I'll cover the NLRx question. This is our asset from Landos. We had observed very early data, I would say, Phase 1b, in ulcerative colitis, and that looked good, but it was a very small sample size, I would say. So this will be a robust Phase 2 with a placebo comparator and we'll get objective data from centralized review of endoscopic data.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

So it will be a good data set to look at. And if it looks good, definitely would be a Phase 3 asset for us. And the other consideration we would have similar to what I highlighted about other biologics that we would be combining with SKYRIZI, if this looks good, this could be a combination agent with RINVOC as well.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Taryn. Operator, next question please.

[Operator]

Yes. Our next question comes from Mohit Bansal with Wells Fargo. Your line is open.

[Mohit Bansal, Analyst at Wells Fargo]

Great. Thank you very much for taking my question and congrats on all the progress. I have a question regarding INI. So I know you talked in the past about Kylian renewal benefiting from some of the Humira prescriptions going to these agents as well. So taking that aside, still it seems like the volume for ionized space is growing rapidly.

[Mohit Bansal, Analyst at Wells Fargo]

Can you talk a little bit about the underlying dynamics as well here? Why this market continues to grow and how should we think about longer term for the overall market growth itself? Thank you.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Yes. So thanks Mohit, it's Jeff. And like we talked about before, particularly around the acute event, in this case, this was the CVS exclusion in April 0, we could clearly start to measure the fact that not all of the switching from HUMIRA was going to the biosimilar. We saw about 20% of it was slipping away into new mechanisms or more advanced mechanisms like SKYRIZI and RINVOC. Now we've continued to see the molecule compress and it's just physicians are using just less and less sequentially HUMIRA and the biosimilars over time.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

I would say it's becoming harder to measure because you're also seeing a lot of dynamics around new head to head trials, new indications, new other approaches. So I would say overall, it's there, but it's relatively modest in the scheme of the volume that is basically accruing from basically the promotion and the profile of the medication. So it should continue. The more that we see sort of disruption in the market, you'll probably continue to see the molecule on trend continue to compress. Now, albeit modest, your other point is very important.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

These markets are still very, very buoyant and significant. And 1 of the dynamics that we see over time, and I think we'll begin to see it quite dramatically around the world, particularly in IBD, is that the lines of therapy start to expand. So it used to be like primarily what was fueling the markets was primarily the new patients coming in off of older traditional medications. But now you're seeing the emergence in atopic dermatitis of the second and third line markets, which are growing quite substantially. You're going to see that significantly emerge in IBD, whereas before physicians were really, really afraid to move people along.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

So they did dose intensification, they added more steroids. But now that there is drugs like SKYRIZI and RINVOC and other agents, you're seeing those market lines of therapy expand. And so that should continue and we've contemplated that in our long term projections. But that gives you some sense of why you're observing what you're seeing.

[Robert Michael, CEO at AbbVie]

As we look across this is Rob, as we look across the specialty areas, in psoriasis and IBD, we're projecting high single digit market growth. Atopic dermatitis in the mid teens, it's growing I mean, you're seeing still fairly low penetration rates for atopic dermatitis, so there's tremendous room for growth. So we would anticipate mid teens market growth there. And then in rheumatoid arthritis, that's probably more like low to mid single digits. But you can see across the board, very nice market growth, which then will be complemented by the market share gains.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks Mohit. Operator, next question please.

[Operator]

Yes. The next question comes from Dave Risinger with Leerink Partners. Your line is open.

[David Risinger, Senior Managing Director & Senior Research Analyst at Leerink Partners]

Yes. Thanks very much. So I have 2 questions, please. First, regarding AbbV400 or TmAbA, could you please frame your long term commercial vision for this candidate, including what some may under appreciate about how broadly it could potentially be adopted in the And then second, on external transactions, emaclidene was a setback, but AbbVie's overall M and A track record has been very successful. Could you please discuss your agenda for M and A, including the potential to leverage your franchise strength and related product categories?

[David Risinger, Senior Managing Director & Senior Research Analyst at Leerink Partners]

Thanks so much.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Yes. Hi, it's Jeff. So I will give some thoughts on that. It's a very, very attractive asset. I think it's underappreciated.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

And part of it is the first category it will compete in, which is colorectal cancer. I mean, if you look at the response rate that we've seen, let's say, in a smaller or mid size cancer type, which is ovarian cancer with Elahir, it's quite striking. I mean, Elahir has been the most rapidly adopted ADC in the entire U. S. Oncology market.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

And it's because it entered this market that was basically almost all chemo based with unmet need where there had been no innovation. And when we look at the entry with four hundred or TmAb A into colorectal cancer, it's a substantially larger tumor type as it's quite evident. And we've already seen very, very nice monotherapy result in later lines, much, much better than we've seen with the old chemo standard of care. And really it's whether or not they have C met or not. Now the thing that will really cause a big inflection that Rupal can talk about in a moment is that it's the combinability as you go up into the lines of therapies, okay.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

And that's really going to make this thing inflect and become a very, very significant product for patients in colorectal cancer over time. No, the studies will have to bear that out. And as well, we're seeing very, very significant early results in lung cancer as well. So it is I think it's an underappreciated asset. We'll have a chance with TULISOV to sort of set the market around this whole C Met, the modern C Met area, but it's quite striking.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

So first, we establish in later lines very big cancer directly against older chemotherapy, and then we move combination as we move forward. So thanks for the question.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

It's Rupaul. Maybe just a comment there on our strategy around ADCs and I think 400 is a good highlight of that. So we think about what's a good target meaning high expression on the tumor, low expression in healthy tissue. And then we are continuing to focus on patient selection, individualization of care, utilizing robust biomarkers as Jeff mentioned, C MET. That is the opportunity to optimize benefit risk and particularly tolerability.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

With our Topo Warhead platform, we've seen low rates for example of alopecia, stomatitis, diarrhea, which others I think continue to struggle with. And safety and tolerability as Jeff has mentioned are critical. So we're also very focused on proper dose optimization to get this right that we're able to combine in earlier lines. And that's the same approach that we have with the other 1 I mentioned seven zero six and small cell lung cancer and others in the pipeline.

[Robert Michael, CEO at AbbVie]

And then David, this is Rob. I'll take your question on M and A. And thank you for acknowledging the strong track record we've had as a company. I would agree with that when you think about the transaction with BI that brought us SKYRIZI, with Pharmacyclics that brought us IMbruvic and really gave us the critical mass to be a leader in blood cancers and then the transaction with Allergan, which gave us 3 verticals that can really drive long term growth of the company, neuroscience, aesthetics and eye care and then more recently, the transaction with ImmunoGen, which really bolstered our ADC pipeline, as Rupal has highlighted. In terms of our go forward strategy on BD, we continue to pursue assets that can add depth to our pipeline and really drive growth in the next decade.

[Robert Michael, CEO at AbbVie]

We have clear line of sight to growth for at least the next eight years, within the company today. And so, my focus is really about bringing in assets that can help drive that growth in the next decade. And since the beginning of 2024, as I mentioned in my prepared remarks, we've And since the beginning of 2024, as I mentioned in my prepared remarks, we've signed more than 20 early stage deals across immunology, oncology and neuroscience. In immunology, we've added novel mechanisms that have the potential to raise standard of care either as a monotherapy or in combination with SKYRIZI and RINVOC. You should expect that strategy to continue.

[Robert Michael, CEO at AbbVie]

In oncology, we've added new platforms, including multi specifics, tri specifics, T cell engagers and InSight2 CAR T approaches. Then within neuroscience, it's not always appreciated. The work we've been doing in neuroscience, you know, above and beyond Cerevel, you know, we expanded our discovery collaboration in psychiatry with Gideon Richter, who discovered VRAYLAR. We also invested in a novel mechanism for mood disorders with Gilgamesh, and we recently acquired a next generation A beta antibody for Alzheimer's from Aliada. Again, that is our area of focus.

[Robert Michael, CEO at AbbVie]

We have these 5 areas that can drive long term growth. I mentioned neuroscience, aesthetics and eye care, and of course, immunology and oncology. Mean, these are all large markets with high unmet need. And so, you know, our BD efforts are focused on building pipeline depth in those areas. Now I should say, you know, if we see an opportunity for differentiation in another large market with high unmet need, we would consider pursuing it, especially if it can help drive growth in the next decade and the company has the financial wherewithal to pursue those opportunities as well.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Dave. Operator, next question please.

[Operator]

Yes. Our next question comes from Steve Scala with TD Cowen. Your line is open.

[Steve Scala, Pharmaceutical Analyst at TD Cowen]

Thank you so much. I have an observation and 2 questions. The observation is splitting hairs, but on Part D redesign, the guidance had been a 3 percentage point headwind. It was just said on the call 4 percentage points. A year ago, it was 2 percentage points.

[Steve Scala, Pharmaceutical Analyst at TD Cowen]

If there is a change, please can you identify that? Related to that is my first question. Are you seeing any evidence that IRA Medicare pricing is spilling over to the commercial market? And if yes, to what degree or is there absolutely none? And then my second question, the company has provided a lot of helpful perspective on the aesthetics market, but can you distill it to a number?

[Steve Scala, Pharmaceutical Analyst at TD Cowen]

The guidance for aesthetics was previously greater than $9,000,000,000 in 02/30. What is that number now? Thank you.

[Scott Reents, Executive VP & CFO at AbbVie]

Steve, this is Scott. I'll go ahead and start with your Part D observation and question. With Part D, we've really we saw that as something that the analysts and maybe the marketplace hadn't fully understand, so the impact.

[Scott Reents, Executive VP & CFO at AbbVie]

I think we were 1 of

[Scott Reents, Executive VP & CFO at AbbVie]

the first companies to come out and talk with any sort of specificity and granularity around what we saw that Part D impact, mechanics of how it would work and the impact to it. So we came out with a guidance number and I think that has probably as you noted the numbers, but it's evolved a little bit over time. I would say it's evolved not necessarily from our understanding of Part D, but because really the mix of the business. So when we talk about it in the I believe I came out and said we saw it would see an approximately 3% headwind to growth from the Part D redesign. We've distilled that number and made a precise number of 4% roughly 4% today.

[Scott Reents, Executive VP & CFO at AbbVie]

And really when you think about when I came out of that 3%, we've seen momentum in the business and we've seen momentum in the business in areas immunology and oncology in particular where we raised some guidance where we saw have high Part D channel mix. And so that's really been a business mix change that has led to that 4% change. And that's really kind of what it amounted to.

[Robert Michael, CEO at AbbVie]

And Steve, I'll just add. I mean, when you think about the setup for the company in 2025, we said we will return to robust growth and we're delivering in absolute terms in our guidance, a little bit more than $250,000,000,0.0 of growth and that's with headwinds from U. S. HUMIRA erosion around $3,000,000,000 the Part D benefit we designed approximately $2,000,000,000 when you do the math on the roughly 4% and then a $500,000,000 headwind from the stronger U. S.

[Robert Michael, CEO at AbbVie]

Dollar. So the underlying growth platform is going to drive $8,000,000,000 of growth when you think about SKYRIZI and RINVOC as well as neuroscience. So, the change you're seeing from, as Scott mentioned, is really more of a mix a function of mix, but we're very pleased with the underlying growth of the business has allowed us to absorb these impacts and still deliver robust growth in 2025.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

It's Jeff. I'll take your second question. So as we've negotiated across the commercial books and the Medicare books, we have not seen any spillover or slippage in our actual negotiations over the last cycles. And

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

1 thing

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

I would add is that we have seen in 2024 some more consumption on the benefit redesign, particularly in our oncology agents. So for IMBRUVICA and VENCLEXTA, we actually see lower discontinuations and some more consumption. And so that's encouraging because if you remember, the Part D sort of had the lead in where the cap moved down to roughly 3,300, 3 thousand 4 hundred, it will sequentially move down more to 2,000 with the smoothing next year, which is a good policy because it's encouraging to see that the change in benefit design makes people stay on their cancer medication a bit longer. Again, the volume will be more modest than the price hit as Rob and Scott described it, but that's the dynamics that we're seeing in the channels.

[Scott Reents, Executive VP & CFO at AbbVie]

And Steven, your question regarding the aesthetics guidance, I'll reinforce maybe what I said earlier and Rob as well. So when we look at that guidance, that long term guidance is calling for high single digit CAGR through '25 through '29, so using '25 as the base year. If you do the math on that range, that is something above $7,000,000,000 a little bit north of $7,000,000,000 depending on where it falls within that high single digit range. So that's why we've specifically given the range on the high single digit. The market growth that we've seen historically has been low double digits, but we're seeing that market we're modeling for now, high single digit growth during the time period that we've given this long term guidance.

[Scott Reents, Executive VP & CFO at AbbVie]

And so I think that answers your specific questions.

[Steve Scala, Pharmaceutical Analyst at TD Cowen]

Thank you very much.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Pete. Operator, next question please.

[Operator]

The next question comes from Tim Anderson with Bank of America. Your line is open.

[Tim Anderson, Managing Director, Senior Equity Research Analyst at Bank of America]

Thank you. A couple of questions please. On aesthetics, a question I've asked before, what are your expectations for how BC drugs are going to impact this business? You could argue that the surge in use of products, the GLP-1s could be either a tailwind or a headwind to the use of products like toxins and fillers. It could be a headwind if patients are having to pick and choose between much products to put their out of pocket dollars towards?

[Tim Anderson, Managing Director, Senior Equity Research Analyst at Bank of America]

And then a second question unrelated to the first, PBM reform still being debated in Washington. If AbbVie had its way, what would change about the current relationship between PBMs and drug companies and what would you argue should be left alone?

[Carrie Strom, Senior VP at AbbVie]

Hi, this is Carrie. I'll answer your first question around the obesity market and the aesthetics opportunity. And you're exactly right. It continues to be both a headwind and a tailwind. The headwind in terms of share of wallet as these consumers are making decisions on what they're going to spend for.

[Carrie Strom, Senior VP at AbbVie]

We see that more for the higher priced products like fillers. And then also a tailwind as this gets a new group of consumers or patients interested in aesthetics. And many of our aesthetic providers are administering these products. And so they see this as an opportunity for lead generation and bringing new patients into the category. So we do see it as both a tailwind, a headwind in the short term, but a tailwind in the long term.

[Carrie Strom, Senior VP at AbbVie]

And And the question is not if injectables work. We know that these products work well in these patients. It's really about how we can partner with our customers to build it and integrate it into their treatment practice. And that's what we're doing with our customers now and helping them position BOTOX and Juvederm and our product line for these new patients that are entering their practice.

[Robert Michael, CEO at AbbVie]

And Tim, this is Rob. I'll take your question on PBM reform. Look, if there are changes to the rebate system, we don't have a strong preference between rebates or discounts. And that's because we've always competed on the attributes of our products, both the clinical benefit they provide and the value they return to health systems. So we're confident in our ability to compete in either world.

[Robert Michael, CEO at AbbVie]

I would just point to our share performance in the international markets that do not have a rebate based system and we see similar market shares in those countries as well. So we can compete effectively in either system. We don't have a preference.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Tim. Operator, next question please.

[Operator]

Our next question comes from Chris Raymond with Piper Sandler. Your line is open.

[Christopher Raymond, Sr. Research Analyst at Piper Sandler Companies]

Yes, thanks. Just a question on atopic derm as a target indication. Just from some of our work, it looks like the upside we're seeing in RINVOC is largely in room and gastro and I know you guys have sort of mentioned this and it's fairly well known. But in atopic derm, at least from our data, it looks like things are starting to flatten out a little bit. And I heard your comments on the Durham share of RINVOC revenue in 2027, but that would seem to infer maybe some kind of inflection.

[Christopher Raymond, Sr. Research Analyst at Piper Sandler Companies]

So maybe a 2 part question here. First, talk about the current maybe atopic Durham growth dynamic, and is there an inflection sort of anticipated?

[Christopher Raymond, Sr. Research Analyst at Piper Sandler Companies]

And then the second part

[Christopher Raymond, Sr. Research Analyst at Piper Sandler Companies]

of that is should we be paying more attention maybe to Levituzumab or as a contributor here? I know, Jeff, you've talked about atopic derm as a very important indication that you guys are targeting. Or is there some other sort of area like external innovation that you think will augment maybe your position in this indication? Thanks.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Yes, it's a very good question. It's an important segment. And to give you some sense of what we see in terms of the inflection, so we have seen a significant inflection in our new patient capture. And this is despite the launch of other interleukin products over the last year. So we've ramped to the highest in place shares that we've had.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

And it was largely flat in the teens for mid teens for many, many quarters and it's ramping up now above 20%. And a lot of that is we've been able to start to distinguish, RINVOC on these stringent endpoints, basically like really minimal disease activity where you're taking itch down to a very, very low level and you're almost completely clearing the skin. And those are the endpoints where we significantly outperform DUPI. Now having said that, DUPI still got the vast majority there, but we are seeing we will see that in play share start to build into the TRxs over time because our TRx share is quite below 20% at that point. I think the other thing that I'd note is that in many or if not most of the outside The U.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

S. Markets, our shares are much higher and build even a little bit faster. So in several large markets, we actually are ahead of Dupixent and some of that has to do with the way that the label worked during our initial launch, etcetera. But we're quite bullish over time in terms of RINVOC as this is the best agent in terms of getting to the complete control. Now having said that, we would and we will continue to look for more assets.

[Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie]

Some are in our pipeline as described, but this is a very, very attractive space that we want to continue to invest in. I don't know, Rupal, if you've got any comments on lute or some of the other concepts. That's right.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

I mean with the five percent penetration rate, there's still many patients that are untreated. So ludikizumab will be our next 1 and as Jeff mentioned there's other pipeline assets that we're working on and key being skin clearance along with that itch. And if you can get them both and have a safe and tolerable profile, I think that will continue to be competitive.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Chris.

[Scott Reents, Executive VP & CFO at AbbVie]

Thank you.

[Liz Shea, Senior VP - IR at AbbVie]

Operator, next question please.

[Operator]

Thanks. Our next question comes from Zhuang Wuin with UBS. Your line is open.

[Trung Huynh, Analyst at UBS Group]

Great. Thanks for taking my questions. Just 2 from me. So firstly, your sales in did you see any notable difference in trends in stocking or gross to net patterns across the portfolio ahead of the changes in Part D versus previous years? Specifically, I'm interested if you had any meaningful 1 offs for SKYRIZI and RIMVOT for the quarter.

[Trung Huynh, Analyst at UBS Group]

And then circling back on aesthetics, thanks for that updated long term guide. Can you give us a bit more color geographically how we should think about the split between ex U. S, China versus The U. S. As you return to growth?

[Trung Huynh, Analyst at UBS Group]

Is there an expectation on 1 coming back quicker than the other? Thanks.

[Scott Reents, Executive VP & CFO at AbbVie]

This is Scott. I'll talk about the stocking. So we did not see in the past we've talked about it a couple of years ago in particular, but the stocking was relatively minimal from in terms of the impact. So we did not see anything with respect to Skyrizi and Renbok on the stocking in the that will be impacting the

[Scott Reents, Executive VP & CFO at AbbVie]

And no real dynamics are in gross to net either?

[Scott Reents, Executive VP & CFO at AbbVie]

No, that's right. For Skyrizi and Renbok, I'm sorry, no dynamics around gross to net for Sky Ridge and Renbo. And with respect to aesthetics, I don't care if you want.

[Carrie Strom, Senior VP at AbbVie]

Sure. For aesthetics, if we think about the long term, we see like we said, we're planning prudently further economic recovery around key markets like U. S. And China, where it's been challenging for the past few years. Both those markets will continue to be important moving forward, as well the rest of the world.

[Carrie Strom, Senior VP at AbbVie]

We see Japan, as posting nice growth as being an underdeveloped market that we're able to invest in. And then the pipeline catalyst will be important in both U. S. And the rest of the world. Notably in China, in the past year, we've had multiple new pipeline catalysts, which are going to which continue to help drive share for both toxins and fillers last year and this year.

[Carrie Strom, Senior VP at AbbVie]

And we expect, the international business to continue to increase as a percent of the revenue for overall global Allerganesthetic.

[Liz Shea, Senior VP - IR at AbbVie]

Thanks, Trung. Operator, we have time for 1 final question, please.

[Operator]

Sure. And our last question comes from Chris Shibutani with Goldman Sachs. Your line is open.

[Chris Shibutani, Analyst at Goldman Sachs]

Great. Thank you very much. When you think about going beyond 02/30 with your strategy across the portfolio, can you comment about the potential impact of some of these combination approaches in immunology? Do you expect these to be IP extending? Will there be co formulation based approaches?

[Chris Shibutani, Analyst at Goldman Sachs]

Just trying to understand the potential revenue implications, noting that clearly there could be some clinical benefit that could certainly make sense.

[Chris Shibutani, Analyst at Goldman Sachs]

And then just a question about

[Chris Shibutani, Analyst at Goldman Sachs]

a business segment that has been around that you never talk about, which is eye care. How and why does this fit going forward? I understand there's a legacy with the Allergan deal, but just trying to think about the overall portfolio in areas where you clearly have strengths, but this seems to be 1 which is less than 5% of revenues, but what is the role for that on the forward? How are you thinking about it? Thank you.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

Hey, Chris, it's Rupal. Maybe I'll start the ball rolling here on how we think about combos into 02/30. So the first thing is we have a very strong foundational asset in particularly IBD with SKYRIZI and you've heard of me mention other combo studies in psoriatic arthritis today as well. Now that we would combine with the multiple assets that we've mentioned over time, TL1A, TREM1, alpha-four beta-seven, IL-one alpha beta, lutekizumab that we already have. These that we would be able to look at as monotherapies and combo therapies.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

If they look good as monotherapies, they could also move forward by themselves. For all of these assets, we're also looking at biomarker approaches particularly with ludikizumab, but we would apply that same strategy to all of these assets. And as combinations, the goal would be co formulation. So as we enter into the clinical study, we are also doing CMC work in parallel to facilitate combination co formulation approaches. So that would also be a convenience factor and we would want to match with longer acting agents.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

So for example, the TL1A, we believe to be a longer acting agent. For Trem-one, we're seeing a long pharmacodynamic effect as an example. But then the next way that we think about this, these combo strategies is if we start seeing utility there obviously moving forward with the co formulation, but we are very confident in making bispecifics. Luticizumab is 1 of those. So then in parallel, we are making bispecifics that could then also stand alone as single assets.

[Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie]

And then as you've heard recently with our Nimble transaction, we would also be looking at different mechanisms as an oral peptide, the lead 1 being IL-twenty 3, but we're also working on a TL1A. And what's unique and what we like about that platform is the potency, potentially being able to reduce the amount of peptide that's required and these assets having long half lives. So if that holds, then you could imagine combinations as a pill with these peptides with that type of profile that we hope to see. So multiple steps as we think about immunology.

[Robert Michael, CEO at AbbVie]

And then this is Rob. Your question on eye care. I mean our focus on eye care is in glaucoma, retinal disease and prescription dry eye. We like that business. It participates in a large market with high unmet need, meets that criteria.

[Robert Michael, CEO at AbbVie]

It has very much a scientific focus. It's a data driven business. It's a very efficient business as well. And obviously, we're excited about the Regenxbio gene therapy program focused on wet AMD and diabetic retinopathy. Depending on how that plays out, I think you could see that as becoming a stronger growth driver.

[Robert Michael, CEO at AbbVie]

We obviously have 4 to 5, as you think about, you get a lot of questions there, but we don't get as many questions in eye care. But we do believe as you start to get more visibility to this Regenexx Bio program, you'll likely spend more time focusing on it. We think of it as a potential to be a long term growth chart for the company and we like the fit it has for AbbVie.

[Liz Shea, Senior VP - IR at AbbVie]

Thank you, Chris. And that concludes today's conference call. If you'd like to listen to a replay of the call, please visit our site at investors.abi.com. Thanks again for joining us.

[Operator]

Thank you. That concludes today's conference. You may all disconnect at this time.

Participants

Analysts

• Liz Shea, Senior VP - IR at AbbVie
• Robert Michael, CEO at AbbVie
• Jeffrey Stewart, Executive VP & Chief Commercial Officer at AbbVie
• Carrie Strom, Senior VP at AbbVie
• Roopal Thakkar, Executive VP of Research and Development & Chief Scientific Officer at AbbVie
• Scott Reents, Executive VP & CFO at AbbVie
• Vamil Divan, Managing Director & Senior Research Analyst at Guggenheim Securities, LLC
• Chris Schott, Managing Director at JP Morgan
• Geoff Meacham, Managing Director at Citi
• Terence Flynn, Equity Research Analyst at Morgan Stanley
• Mohit Bansal, Analyst at Wells Fargo
• David Risinger, Senior Managing Director & Senior Research Analyst at Leerink Partners
• Steve Scala, Pharmaceutical Analyst at TD Cowen
• Tim Anderson, Managing Director, Senior Equity Research Analyst at Bank of America
• Christopher Raymond, Sr. Research Analyst at Piper Sandler Companies
• Trung Huynh, Analyst at UBS Group
• Chris Shibutani, Analyst at Goldman Sachs