AbbVie Lays Out Long-Term Vision in Biotech Firm’s First R&D Dayby
Company seeks to broaden product line beyond top seller Humira
Focusing on cancer, immunology, virology, neuroscience
AbbVie Inc., the drugmaker spun off from Abbott Laboratories in 2013, held its first research and development day, laying out plans to build an R&D-focused company with a broad portfolio of treatments for cancer, immunology, virology and neuroscience.
“Although we’re still early on in our journey, we are extremely proud of our track record and progress,” Chief Executive Officer Rick Gonzalez said Friday in a presentation to investors and analysts at the Fairmont hotel in Chicago. He promised double-digit average annual growth in earnings per share through 2020, and emphasized his commitment to research.
“We won’t cut back on R&D to manage a bottom line,” though the company could cut costs in other areas, he said.
Gonzalez’s foremost challenge is to reduce the drugmaker’s reliance on Humira, its blockbuster rheumatoid arthritis treatment, which accounted for 61 percent of revenue in 2015. Humira sales are expected to decline as competitors create copycat drugs, called biosimilars.
AbbVie has doubled down on cancer, buying Pharmacyclics Inc. last year for its blood cancer drug Imbruvica and, more recently, Stemcentrx Inc. for its experimental drugs targeting solid tumors.
When the Stemcentrx acquisition was announced in April, some analysts questioned whether the $5.8 billion price tag was too high. On Friday, Stemcentrx’s Chief Scientific Officer Scott Dylla explained the company’s technology and describing its lead drug, Rova-T. Data from the drug’s first trial in humans will be presented Sunday at the annual meeting of the American Society for Clinical Oncology in Chicago.
The target of the drug, a protein called DLL3, is found in about 80 percent of small cell lung cancer patients, Dylla said. Stemcentrx CEO Brian Slingerland said patients who already have undergone a biopsy won’t need another to test for the presence of the receptor.
“The early-stage data is encouraging and if proven out in humans will more than help AbbVie accomplish its long-term financial growth goals,” said John Schroer, sector head of health care at Allianz Global Investors, after watching the Stemcentrx presentation.
In immunology, AbbVie is working on new drugs for rheumatology, dermatology and gastroenterology, and in virology it’s developing next-generation treatments for hepatitis C. The drugmaker also is investing in neuroscience. It has an early-stage drug for Alzheimer’s disease targeted at the tau protein and is developing a novel treatment that potentially could repair nerve damage in multiple sclerosis patients.
Looking at the long term, AbbVie also has signed a 10-year partnership with Calico, a biotech company created by Google parent Alphabet Inc. Calico focuses on the biology of aging, which dovetails with AbbVie’s programs in cancer, Parkinson’s disease and Alzheimer’s disease.
The two drugmakers have about 20 programs under way, Gonzalez said at the meeting. It’s possible that drug candidates will be identified in three years, though given the early stage of research, the schedule is still not set, said Mike Severino, executive vice president of R&D, in an interview.
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