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Here's Why AbbVie Stock Surged 21.1% in November

By Cory Renauer - Dec 9, 2018 at 4:25PM

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Hints of success for the company's blood cancer pipeline encouraged investors last month.

What happened

Shares of AbbVie (ABBV -1.97%), the pharmaceutical company behind all those Humira advertisements, soared 21.1% in November, according to data from S&P Global Market Intelligence. The stock began November near a 52-week low, but impressive results from the company's blood cancer studies helped turn the ship around.

So what 

October ended on such a low note that a solid third-quarter report combined with positive news for the company's blood cancer treatments were enough to help AbbVie stock recover. Total third-quarter revenue rose 18% from the previous year, to $8.2 billion, and adjusted earnings jumped 52% higher to $2.14 share.

A man in a suit touches the arrow at the end of a zigzagging line moving upward.

Image source: Getty Images.

AbbVie's increased its dividend more than once in the past year, and it looks as if rising sales of blood cancer treatments could make it possible to steadily raise the payout despite the impending loss of Humira sales in the years ahead. Sales of the popular anti-inflammatory injection are on pace to reach $20 billion in 2018, and AbbVie still relies on the flagship treatment for 62% of total revenue.

Now what

Gazyva is a targeted antibody often combined with poorly tolerated chemotherapy to treat newly diagnosed patients with the most common form of leukemia. From now on, it looks as if oncologists will combine it with AbbVie's Imbruvica instead. Patients treated with Gazyva plus Imbruvica were 77% less likely to show signs of disease progression compared to those that received Gazyva plus chemo. AbbVie's share of Imbruvica sales reached $2.6 billion during the first nine months of 2018 and will probably pass $5 billion in 2019 with an extra push from these results.

AbbVie also posted impressive data from the Murano trial with Venclexta plus Rituxan for relapsed leukemia patients. Patients given Rituxan plus Venclexta were 83% less likely to show signs of disease progression than those given Rituxan plus chemo. Replacing Humira in the years ahead won't be easy, but blockbuster blood cancer drug sales on the horizon give AbbVie a fighting chance.

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