Cantor Fitzgerald has initiated coverage on AbbVie Inc (NYSE:ABBV), a global pharma company.
The analyst notes that the company has positioned itself to absorb Humira biosimilar erosion and achieve modest operational revenue growth.
Related: Ex-Humira Growth Platform Drives AbbVie's Q1 Performance, Drugmaker Lifts Annual Profit Outlook.
Cantor expects robust growth to resume in 2025, with projections aligning with management's long-term guidance of a high single-digit compound annual growth rate (CAGR) from 2024 to 2029.
This forecast follows one of the largest losses of exclusivity (LOE) in the pharmaceutical industry.
The analyst has initiated the coverage with an Overweight rating, with a price target of $200.
Cantor expects that Bristol-Myers Squibb Co (NYSE:BMY), which acquired Karuna Therapeutics' KarXT, will likely come to market before AbbVie's antipsychotic emraclidine and become the leading drug.
The analyst notes that if emraclidine's Phase 2 studies show a similar reduction in PANSS to what was seen in Phase 1, physicians think that emraclidine will win over KarXT.
Positive and Negative Syndrome Scale (PANSS) is used to assess antipsychotic treatment efficacy.
"When we compare the two products, we believe emraclidine differentiates by its dosing frequency (QD vs. BD), better GI safety profile, and potentially greater efficacy (PANSS score)," Cantor writes.
The analyst says the peak sales potential of Skyrizi, Rinvoq, emraclidine, and AbbVie's pipeline is underappreciated, and Humira's tail will be manageable at $4 billion—$5 billion in annual sales.
AbbVie is advancing its second wave of Rinvoq development programs, with Phase 3 studies ongoing for five new indications: giant cell arteritis, lupus, hidradenitis suppurativa, alopecia areata, and vitiligo.
The company expects to release data from these studies within the next three years. These new indications could generate several billion dollars in peak sales, indicating substantial growth potential for Rinvoq beyond 2027.
Price Action: ABBV shares were up 1.10% at $166.16 at last check on Friday.
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