Abbvie Inc. · NYSE:ABBV
Abbvie — Investor Day (October 2015)
33 slides from Abbvie's investor day presentation, Oct 30, 2015
Slide 1: AbbVie Long-Term Strategy
ABBVIE LONG-TERM STRATEGY Richard Gonzalez Chairman and Chief Executive Officer October 30, 2015
Slide 2: Forward-Looking Statements and Non-GAAP Financial Information
Forward-Looking Statements and Non-GAAP Financial Information Some statements in this presentation may be forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "project" and similar expressions, among others, gen
Slide 3: Strategic Actions Have Positioned AbbVie to Achieve Sustainable Top-Tier Performance
Strategic Actions Have Positioned AbbVie to Achieve Sustainable Top-Tier Performance AbbVie’s Mission: Create an innovation-driven, patient-focused specialty biopharmaceutical company capable of achieving sustainable top-tier performance through outstanding execution and consistent stream of innovat
Slide 4: AbbVie Has Delivered Robust Financial Results Since Spin-Off
AbbVie Has Delivered Robust Financial Results Since Spin-Off Sales ($BN) EPS ($) >22.5 4.27 19.9 3.14 3.32 18.8 2013 2014 2015 Guidance 2013 2014 2015E Mid-Point EBITDA ($BN) Operating Cash Flow ($BN) ~10.0 ~7.0 6.3 7.2 7.6 5.2 2013 2014 2015E 2013 2014 2015E Notes: EPS adjusted for specified items
Slide 5: Financial Discipline and P&L Leverage Has Driven Operating Margin Expansion
Financial Discipline and P&L Leverage Has Driven Operating Margin Expansion, Despite Significant Increase in R&D Investment $850MM + 710 bps + 1,120 bps R&D Gross Margin Operating Margin Increase in Annual Investment as a % of Sales as a % of Sales Since 2012 Q3 2015 vs. Q1 2013 Note: Adjusted for o
Slide 6: AbbVie's EPS Performance Has Consistently Met Or Exceeded Expectations
AbbVie’s EPS Performance Has Consistently Met Or Exceeded Expectations Full-Year EPS – Guidance vs. Actuals EPS Growth: $4.50 +28.6% 4.27 4.15 $4.00 EPS Growth: +5.7% $3.50 3.32 3.14 3.08 3.05 $3.00 $2.50 Initial Actual Initial Actual Initial Current Guidance Guidance Guidance Mid-Point 2013 2014 20
Slide 7: Execution of Our Strategy Has Delivered Significant Shareholder Value
Execution of Our Strategy Has Delivered Significant Shareholder Value Total Return Since Separation (1) Since 1/1/13 through 10/29/15 250% 199.6% 200% 150% 125.2% 96.3% 100% 81.7% 75.7% 58.0% 57.1% 56.5% 55.3% 52.1% 47.6% 47.5% 46.8% 44.9% 50% 15.8% 13.3% 0% GILD BMY AMGN LLY ABBV NVS AZN JNJ PFE RH
Slide 8: Well-Positioned for Long-Term Growth
Well-Positioned for Long-Term Growth AbbVie’s Commitment Sales • Strategically positioned in attractive, high-growth market segments • Expects to deliver top-tier revenue growth through 2020 – Expects total company sales of approximately $37BN in 2020 – Targeting 2020 global Humira sales of >$18BN a
Slide 9: AbbVie Is Positioned for Leadership in Extremely Attractive Market Segments
AbbVie Is Positioned for Leadership in Extremely Attractive Market Segments Immunology Oncology Virology Neurology Other $47BN Market(1) >$85BN Market $23BN HCV Market $26BN Market(2) Significant Unmet Need • Leadership positions • Developing leadership • Established foothold • Duodopa/Duopa a • Ela
Slide 10: AbbVie Forecasting Revenue of $37BN by 2020, CAGR of ~10%
AbbVie Forecasting Revenue of $37BN by 2020, CAGR of ~10% Revenue Street $Bn 2015 AbbVie Long-Range Plan (LRP) 40 37 35 Performance Drivers 32 30 • Humira continues to be strong growth driver, adding close to $4BN in sales 25 23 • AbbVie Imbruvica revenue reaches approximately $5BN in sales by 2020
Slide 11: On-market Brands Offer Significant Growth by 2020
On-market Brands Offer Significant Growth by 2020 • Anticipate continued growth by driving biologic penetration, increasing market share leadership, and expanding to new indications (HS, Uveitis) with >$1BN in peak-sales 2020 Sales: >$18BN • Assume launch of OUS biosimilar in 4Q 2018 • Hematological
Slide 12: Humira Continues to Drive Strong Growth
Humira Continues to Drive Strong Growth Humira Revenue Forecast $Bn Street (1) AbbVie LRP 20.0 >18.0 15.0 14.0 13.3 10.0 5.0 0.0 2015E 2020E 1) Analyst estimates as of 10/21/2015 AbbVie Long-Term Strategy © 2015 12
Slide 13: Comprehensive Strategy to Continue Leadership Position in Immunology
Comprehensive Strategy to Continue Leadership Position in Immunology Humira Intellectual Property Enhancements to Humira Innovation: Bridging Humira and Strong Immunology Pipeline Commercial Execution AbbVie Long-Term Strategy © 2015 13
Slide 14: Broad U.S. Humira Patent Estate
Broad U.S. Humira Patent Estate Juvenile Approved Rheumatoid Gastro Psoriatic Ankylosing Hidradenitis Psoriasis Idiopathic Indication Arthritis Indications Arthritis Spondylitis Suppurativa Arthritis Composition of Matter Expires Dec. 31, 2016 4 patents 6 patents 3 patents 4 patents 3 patents 1 pate
Slide 15: Method of Treatment Patents
Method of Treatment Patents • Biosimilar companies must have the same route of administration, dosage form and strength as innovator • AbbVie has patent protection covering all of the approved indications • These patents reflect the development work of more than 100 clinical trials • Treatment regim
Slide 16: Litigation Process
Litigation Process • Litigation – The average time to trial of a patent action in courts hearing 10 or more patent cases was approximately 3.35 years(1) – Appeals to the Federal Circuit usually take about a year • Total Litigation Timing: 4 to 5 years • Would seek preliminary injunction against at-r
Slide 17: Robust Immunology Pipeline
Robust Immunology Pipeline AbbVie’s Immunology pipeline is designed to bring best-in-class therapies to market across disease categories, restating markets and driving continued leadership Enhancements to Humira • New indications: HS recently approved; Phase 3 uveitis studies successful • New formul
Slide 18: Strong Commercial Execution Has Made Humira the #1 Prescribed Biologic
Strong Commercial Execution Has Made Humira the #1 Prescribed Biologic • Humira has the highest commercial prescription market share, including highest percentage share of new-patient starts • Humira is preferred or co-preferred on managed care plans for >90% of covered lives • Patients, physicians,
Slide 19: AbbVie Immunology Long Range Plan Built Around Achievable Assumptions
AbbVie Immunology Long Range Plan Built Around Achievable Assumptions; Pipeline Represents Significant Potential Key Assumptions International • International markets grow mid-single-digits over long range plan • Plan assumes some limited erosion impact upon Enbrel biosimilar launch starting in 2016
Slide 20: Imbruvica Is a Significant Contributor
Imbruvica Is a Significant Contributor Projecting Approximately $5BN in 2020 AbbVie Imbruvica Revenue Imbruvica Revenue Forecast $Bn 6.0 ~5.0 Performance Drivers 5.0 • Increasing market share in currently approved indications 4.0 • Move to first-line in CLL and MCL • Planned expansion in other hemat
Slide 21: Hematologic Oncology Market of $27BN Positioned to Grow to $50BN by 2020
Hematologic Oncology Market of $27BN Positioned to Grow to $50BN by 2020 • Acute Myelogenous Leukemia • Multiple Several Leading MOAs Offer Potential • Acute Lymphocytic Leukemia Myeloma for Market Leadership • Chronic Myelogenous Leukemia • BTK: Imbruvica • Chronic Lymphocytic Leukemia •
Slide 22: Select Pipeline Assets
Pipeline to Contribute Meaningfully to Revenue Growth, Assets Span Attractive Specialty Categories Phase I Phase II Phase III Submitted Recent Approvals ABBV-838: Multiple ABT-199: AML ABT-199: CLL (Relapsed/Refractory) Imbruvica: CLL (TN) Humira: Hidradenitis Myeloma Suppurativa (U.S. and EU) ABT-1
Slide 23: Pipeline Has the Potential to Deliver Nearly $30BN in New Revenue By 2024
Pipeline Has the Potential to Deliver Nearly $30BN in New Revenue By 2024 AbbVie has a robust pipeline, built through internal R&D and L&A Long range plan captures the appropriate level of R&D spend to optimize pipeline opportunities Multiple New Products with Multi-Billion Dollar Assets Offer Poten
Slide 24: Pipeline Has Been Significantly De-risked, Offers Strong Growth Potential
Pipeline Has Been Significantly De-risked, Offers Strong Growth Potential • >10 products or indications currently in pivotal development/regulatory review • Potential for >20 new drug or new indication approvals by the end of 2020 • Recent data readouts continue to de-risk key assets, increasing our
Slide 25: Significant Pipeline Activity: Product Launches and Key Data Flow
Significant Pipeline Activity Product Launches and Key Data Flow Seven Approvals That Will Contribute to 2016 and Beyond • Imbruvica: First-Line CLL • Elotuzumab: R/R multiple myeloma • Venetoclax (ABT199/GDC-0199): R/R CLL (17P Mutation) • Humira: Hidradenitis Suppurativa • Viekira: Japan Approval
Slide 26: AbbVie Revenue Growth Commitment Driving Strong Compound Annual Growth Rate
AbbVie Revenue Growth Commitment Driving Strong Compound Annual Growth Rate 2015 Through 2020 20% 16.7% > 5% Growth 3.5–5% Growth < 3.5% Growth 15% 10.2% 10% 8.4% 8.3% 7.8% 7.2% 4.6% 4.5% 4.5% 4.0% 4.0% 3.8% 5% 3.6% 3.4% 3.3% 2.9% 0% CELG AbbVie BMY BIIB NOVO LLY PFE RHHBY NOVN BAYRY JNJ SNY AMGN MR
Slide 27: Significant Focus on Operating Efficiencies Has Resulted in Strong Improvement in Margin Profiles
Significant Focus on Operating Efficiencies Has Resulted in Strong Improvement in Margin Profiles Gross Margin Profile Operating Margin Profile 84.0% 82.9% 83.3% 50.0% 44.9% 45.0% 40.1% 82.0% 40.0% 33.7% 33.9% 35.0% 80.0% 78.4% 30.0% 78.0% 25.0% 76.2% 20.0% 76.0% 15.0% 10.0% 74.0% 5.0% 72.0% 0.0% 1Q
Slide 28: Targeting Operating Margin of Greater Than 50 Percent in 2020
But There is More to Come… Targeting Operating Margin of Greater Than 50 Percent in 2020 Operating Margin (%) Performance Drivers • Continued focus on operating margin 55% improvement Targeting operating margin of greater >50.0% than 50 percent in 2020 50% Average of 100-200 basis points of impr
Slide 29: AbbVie EPS Growth Commitment Driving Double-Digit EPS Growth
AbbVie EPS Growth Commitment Driving Double-Digit EPS Growth on Average 2015 Through 2020 40% 30% 21.5% 21.2% 20% 14.9% 14.6% 12.3% 10.8% 9.2% 9.2% 9.0% 8.9% 8.2% 7.7% 10% 7.6% 7.3% 6.4% 5.9% 2.1% 0% CELG BMY AbbVie LLY NOVO BIIB NOVN PFE MRK BAYRY AMGN RHHBY GSK AZN SNY JNJ GILD LRP* A Powerful Com
Slide 30: AbbVie Offers Both Compelling Growth and Strong Capital Allocation
AbbVie Offers Both Compelling Growth and Strong Capital Allocation • AbbVie has repurchased $6.25BN of shares so far in 2015 — $3.45BN remaining on current authorization • Track record of strong and growing dividend; increasing 2016 dividend by 12 percent, beginning with dividend payable in February
Slide 31: AbbVie Continues to Deliver Top-Tier EPS Growth
AbbVie Continues to Deliver Top-Tier EPS Growth EPS Growth 2015 - 2020 CAGR: 14.9% +17.1% +28.6% $5.00 +5.7% $4.27 $3.14 $3.32 2013 2014 2015 2016 Guidance Guidance Midpoint Midpoint Note: Adjusted Earnings Per Share AbbVie Long-Term Strategy © 2015 31
Slide 32: Proven Track Record of Delivering on Financial Commitments
Proven Track Record of Delivering on Financial Commitments AbbVie represents a unique investment vehicle, offering top-tier revenue and EPS growth, significant cash flow and strong return of capital to shareholders • Top-tier revenue growth expected through 2020 — Humira revenue above $18BN in 2020
Slide 33: Qobvie
Qobvie