When Humira Finally Faces Biosimilar Competition, Losses For AbbVie May Not Be As Steep As Expected, Say Analysts

Research note from SVB Leerink says revenue erosion once biosimilars hit the market in 2023 may be more gradual than some prior predictions.

A new analysis bodes well for AbbVie’s Humira (adalimumab) profits, as it vigorously attempts to fend off competition from biosimilar competitors to one of the leading treatments for rheumatoid arthritis and other autoimmune diseases.

In fact, AbbVie has battled new biosimilar competitions so aggressively, that a recent investigative report from the House Committee on Oversight and Reform describes a “cold and heartless” methodology to keep competitors away from its franchise, according to The Center for Biosimilars®.

The scathing congressional report says that AbbVie has raised the price of Humira 27 times. A 40mg/mL syringe is now priced at $2,984 — $77,586 annually — which works out to be a 470% increase in price from when the drug launched in 2003.

Humira has netted AbbVie $170 billion in net revenue worldwide since 2003, “Including $107 billion from the U.S. health care system,” according to the congressional report.

Humira prices in the European Union, where the drug has biosimilar competition, are often less than half or one-third the cost than prices in the US.

The congressional report also alleges that there is an unspoken collaboration between AbbVie and Amgen, which markets Enbrel (etanercept), a brand-name competitor to Humira.

“Instead of pricing Humira and Enbrel below one another to gain market share — as expected in a competitive market — AbbVie and Amgen engaged in a practice known as 'shadow pricing,' consistently following the other company’s price increases,” the report says.

Currently, there an't any biosimilars to Humira on the market in the U.S., although six have been approved by the FDA and may come on the market in 2023. However, Alvotech, an Icelandic biosimilars company, believes it has obtained the data it needs to convince the FDA to award an “interchangeable” designation for its high-concentration, citrate-free biosimilar candidate (AVT02), to Humira per The Center for Biosimilars®.

Although AbbVie is working to stave off biosimilar competition, the threat to its revenues from Humira revenue may be less than expected, at least in the initial period of biosimilar competition, SVB Leerink Analyst Geoffrey Porges and his team wrote in a new research note obtained by Managed Healthcare Executive®.

“Our analysis suggests that US Humira could experience a more gradual revenue decline than our current estimate of 71% erosion within 11 quarters,” Porges wrote. “While we expect Humira to have a steeper revenue erosion in the U.S. than Remicade, we believe the branded drug has some unique formulation characteristics (broader dose range and reduced injection site pain) and a broad label centered on disease indications that require chronic treatment, that could defend its franchise from rapid erosion.”

Fiscal year 2023 revenue in the US could still be $17.9 billion at the median and $14.5 billion at the minimum — higher than consensus and the firm’s current estimate, the analysts noted.

“Our analysis suggests that Humira could experience a more gradual revenue erosion in 2023 and 2024, which leaves substantial upside for AbbVie’s revenue outlook during this transition period,” Porges wrote.