AbbVie: The Exploration Journey of an Immunology Titan

The well-known American media outlet, Evaluate Pharma, had predicted significant changes in the ranking of the top 10 global prescription drug sales by 2028, with AbbVie set to become the pharmaceutical company with the highest-selling prescription drugs in the world. In fact, AbbVie's global revenue had already reached $55.41 billion in 2021, only second to Pfizer, which made a fortune from COVID-19 products ($72.043 billion). 

AbbVie, which achieved such a result, did not formally go public until January 2, 2013, completing ten years in 2023. So, what led to AbbVie's present success? And what lessons can other pharmaceutical companies learn from its success?

Started at Abbott

AbbVie, although only listed for less than 10 years, traces its history back to the establishment of Abbott Laboratories in 1888. At that time, the modern human pharmaceutical industry had not yet formed, and the drugs circulating on the market were mostly derived from natural extracts, mainly in the form of concoctions. 

This brought great inconvenience to drug transportation, and the stability of the drugs was also affected, deeply troubling the practicing physician of the time, Wallace Calvin Abbott.

In order to change this situation, Abbott made common drugs like morphine, quinine, and codeine into tiny "dosage particles" to make the drug dosage more accurate, the performance more stable, and the patient's administration more convenient. 

In 1888, Abbott founded a company named after himself - Abbott Laboratories, mainly dealing with these "dosage particles". In the founding year of the company, it earned a revenue of $2,000 just by selling these drugs, while the average annual income of American workers was only $420. 

Thereafter, Abbott Laboratories soared to prominence. It expanded internationally in Canada, the UK, and India. Like many century-old pharmaceutical companies, Abbott made significant contributions during World War I. Its antiseptics, Chlorazene for cleaning soldiers' wounds, and anti-malarial drug quinine, significantly reduced the number of deaths on the battlefield. 

Later, Abbott successively launched anesthetics, sedatives, vitamins, as well as drugs for the treatment of epilepsy, thyroid diseases, and AIDS; besides developing therapeutic drugs, Abbott also introduced the first HIV (Human Immunodeficiency Virus) antibody test method.

In 1929, Abbott Laboratories went public on the Chicago Stock Exchange, issuing 20,000 shares at $32 per share. By 1948, Abbott had grown into a pharmaceutical company with over 1,500 employees, expanding its business to North America, Europe, and other countries. Subsequently, Abbott also developed diversified businesses, including non-fat milk creamer, rubber gloves, sweeteners, etc.

In 1998, the company welcomed its third CEO - Miles White. Unlike other pharmaceutical giants that focused solely on mergers and expansions, White advocated for a balance of gains and losses, integration and separation. 

In October 2011, White proposed the division of Abbott Laboratories into two entities: non-patent drugs, diagnostics and nutritional products and other diversified businesses would remain under Abbott, while innovative drug businesses would be transferred to AbbVie. On January 2, 2013, AbbVie officially listed on the New York Stock Exchange at a stock price of $39.42 per share.

Surpassing Abbott

At the time of its initial public offering (IPO) on the New York Stock Exchange, AbbVie had a market value of only $18 billion and was defined as a "small but beautiful" company. However, a few months later, AbbVie's market value surpassed that of its former parent company, Abbott. This was mainly due to its blockbuster product, Humira, also known as the famed “King of Drugs”.

Looking back on the acquisition history of Humira, it could be seen as a gamble. In 1993, the German company BASF and the British company Cambridge Antibody Technology (CAT) jointly developed the first fully humanized TNF (tumor necrosis factor) monoclonal antibody drug D2E7 (aka Humira). 

In 2000, BASF decided to sell its pharmaceutical division, Knoll. At the same time, Abbott was looking for suitable acquisition targets to supplement its product line. Consequently, Abbott purchased Knoll for $6.9 billion, and D2E7 became Abbott's product before passing into the hands of AbbVie.

At that time, Abbott's acquisition was full of risks. This was because the market already had two approved TNF inhibitors: Amgen/Pfizer's Enbrel and Johnson & Johnson's Remicade. D2E7, which had a similar mechanism of action, did not appear to have an edge over these two.

However, from late 2002, after D2E7 was approved by the FDA for sale in the United States, its performance soared. Besides being the only fully humanized TNF monoclonal antibody drug on the market at that time, the company's market strategy also played a big role. 

Regarding indications, Humira was always far ahead in being approved for a wide variety of conditions, including rheumatoid arthritis, psoriasis, plaque psoriasis, ankylosing spondylitis, and juvenile idiopathic arthritis. In terms of patent protection, the company continually extended its patent protection period through lawsuits and settlements, significantly delaying the entry of competitive products into the market.

Since 2013, Humira has accounted for more than 50% of AbbVie's sales for seven years. In 2018, Humira achieved its highest annual sales ever at $19.936 billion, contributing 60% to AbbVie's total annual sales of $32.8 billion.

Who is the successor to the "Drug King"?

For original research-based pharmaceutical enterprises, the patent cliff has always been a major issue in the life cycle of drugs, and it is also a hurdle that large pharmaceutical companies cannot overcome. 

The patent for Humira in Europe expired in October 2018. In the United States, its patent protection will also expire in 2023. Facing the upcoming sales deficit, AbbVie began looking for successors early on.

Among them, the self-exempt products Rinvoq (upadacitinib) and Skyrizi (risankizumab) are given high hopes. Rinvoq is an orally administered JAK (Janus kinase) inhibitor with high selectivity for the JAK1 subtype. In August 2019, Rinvoq was approved by the FDA for marketing for the treatment of adult patients with moderate to severe active rheumatoid arthritis who are inadequately responsive or intolerant to methotrexate. 

In addition to treating rheumatoid arthritis, Rinvoq is also used in several Phase III clinical trials for the treatment of ulcerative colitis, psoriatic arthritis, Crohn's disease, and atopic dermatitis, among other inflammatory diseases. Thus, its indications are expected to expand further.

Although Rinvoq has also been hit with a black box warning by the FDA, this product had sales of $1.651 billion in 2021, outperforming Baricitinib, a first-generation JAK inhibitor that was launched two years earlier.

Skyrizi is an interleukin-23 (IL-23) inhibitor and was approved by the FDA and EU in 2019 for the treatment of moderate to severe plaque psoriasis in adult patients. At present, Skyrizi has been approved for the treatment of moderate to severe active Crohn's disease and active psoriatic arthritis (PsA). 

In its second year of commercial sale, Skyrizi had annual sales of $1.59 billion; in 2021, Skyrizi's sales reached $2.939 billion, an increase of 84.9% over the previous year. It has squeezed into the top ten in global drug sales, becoming a major drug in AbbVie's own immune disease pipeline, demonstrating its potential to take over from Humira.

According to Evaluate Pharma, by 2026, the combined sales of Skyrizi and Rinvoq will reach $15.8 billion. 

In fact, AbbVie is highly investment-conscious, never having stopped its merger and acquisition activities since its inception. Between 2014 and 2016, it successively acquired bio-tech companies ImmuVen and Stemcentrx, cancer pharmaceutical company Pharmacyclics, and promoted drugs in collaboration with companies such as Infinity and Calico while simultaneously increasing its research and development efforts and pursuing both independent and collaborative development.

In particular, its collaboration with Pharmacyclics allowed it to acquire another blockbuster product, Imbruvica. In April 2015, AbbVie incorporated Pharmacyclics at a transaction price of $21 billion, earning it 50% of the shares in the legendary drug Imbruvica.

Imbruvica is a Bruton’s tyrosine kinase (BTK) inhibitor. BTK plays a key role in the occurrence and development of tumors and is critical to the survival of various B-cell malignant tumor cells such as leukemia. BTK inhibitors have shown excellent anti-tumor activity in clinical trials, attracting great attention. 

In November 2013, the FDA accelerated the approval of Imbruvica (brand name: Ibrutinib) for the treatment of mantle cell lymphoma, making it the first approved BTK drug.

According to data from The Wall Street Journal, the annual treatment cost of Ibrutinib reached $155,400 in 2016 with a global sales revenue of about $1 billion. After several years of development, by 2021, Imbruvica had climbed to the 9th best-selling global drug with a sales volume of $7.607 billion. Since it was first marketed, Imbruvica has contributed a cumulative $23 billion in revenue to AbbVie, making it a powerhouse product for the company.

However, Imbruvica is facing severe challenges. Currently, there are five marketed BTK inhibitors. Aside from Imbruvica, the other four are second-generation BTK inhibitors: AstraZeneca's Acalabrutinib (approved in 2017), BeiGene's Zanubrutinib (approved in 2019), Ono Pharmaceutical/Gilead's tirabrutinib (approved in 2020), and InnoCare’s Orelabrutinib (approved in 2020). Imbruvica's market share is being undermined.

What does AbbVie have up its sleeve for the next step?

Breaking into Aesthetic Medicine

In June 2019, AbbVie acquired Allergan through a combination of cash and stock transaction, with the deal valued approximately at $63 billion in equity, thereby acquiring Allergan's blockbuster aesthetic medicine product, Botox. Botox is an injectable type A botulinum toxin product, and it holds the highest market share globally for botulinum toxin, having once held up to 86% of the global market share and still maintaining over 65% currently. 

As one of the most popular aesthetic medicine products globally, botulinum toxin, known for its ability to slim faces and legs, reduce wrinkles, and minimize muscles, is widely popular among beauty enthusiasts. Botox had revenues of $860 million, $1.21 billion, $1.37 billion, $1.55 billion, and $1.66 billion respectively from 2015 to 2020. In 2021, its global sales significantly rebounded to $2.232 billion. However, as the global top player of botulinum toxin, Botox is also facing challenges from emerging competitors in the field.

AbbVie has been striving to diversify its operations and develop new products. In the immunology field, AbbVie continues to conduct various clinical trials for immune-mediated diseases through programs such as ABBV-154. 

In addition to focusing on its core areas, AbbVie has also made strides in the field of ophthalmic gene therapy. Vuity, an important product in AbbVie's ophthalmic pipeline, received FDA approval in October 2021 for the treatment of presbyopia, becoming the first ever eye drop specifically for presbyopia. 

In September of the same year, AbbVie partnered with Regenxbio to jointly develop and commercialize an ophthalmic gene therapy drug, RGX-314, for the treatment of wet age-related macular degeneration (wAMD), diabetic retinopathy (DR), and other chronic retinal diseases. 

Since its separation in 2013 as a "small but perfectly formed" company, AbbVie has grown into one of the world's top pharmaceutical companies, valued at over $250 billion, in less than a decade. 

It has expanded its R&D pipeline from immunology to oncology, neurology, ophthalmology, aesthetic medicine, and other fields. Looking back at AbbVie's history, we admire the wisdom and courage of the leadership, represented by White, and their unique vision and decisive decision-making power. 

Moreover, by delving into the logic behind AbbVie's blockbuster products, we will find that meeting unmet clinical needs is the ultimate secret.

References

1.Company histories, Abbott lab：http://www.company-histories.com/Abbott-Laboratories-Company-History.html；

2. SKYRIZI® (risankizumab-rzaa) Receives FDA Approval as the First and Only Specific Interleukin-23 (IL-23) to Treat Moderately to Severely Active Crohn's Disease in Adults. Retrieved June 17, 2022 from https://news.abbvie.com/news/press-releases/skyrizi-risankizumab-rzaa-receives-fda-approval-as-first-and-only-specific-interleukin-23-il-23-to-treat-moderately-to-severely-active-crohns-disease-in-adults.htm；

3.Buggy, J. J., Elias, L. Bruton Tyrosine Kinase (BTK) andIts Role in B-cell Malignancy.International Reviews of Immunology,2012, 31(2): 119–132.