(NYSE: ABBV) is facing a tough year ahead. The company's blockbuster drug Humira, which treats various autoimmune conditions such as rheumatoid arthritis, psoriasis, and Crohn's disease, will face biosimilar competition in the U.S. market starting in January 2023. Humira was a major revenue driver for AbbVie, contributing $3.5 billion out of the company's $12.2 billion total net revenue in the first quarter of 2023, and accounting for nearly 40% of the company's annual revenue in previous years.
To cope with this challenge, AbbVie has made several strategic acquisitions in the past few years, such as Pharmacyclics for the blood cancer drug Imbruvica and Allergan for its medical aesthetics and neuroscience portfolios. However, these deals may not be sufficient to offset Humira's commercial decline (see here and here for more details). Therefore, AbbVie may have to look for more opportunities to acquire smaller companies with promising drugs in 2023 and beyond.
One of the key considerations for biopharma companies when pursuing business development opportunities is how well the target company aligns with its strategic goals, such as expanding into new therapeutic areas, enhancing its pipeline, or diversifying its revenue streams. Another important factor is the market value of the target company's products, whether they are in clinical development or already approved and marketed. A third factor is the price that the acquiring company is willing to pay, which depends on various factors such as the competitive landscape, the expected return on investment, and the availability of financing.
Source Fool.com