AbbVie on Thursday reported a boost in first-quarter profit on higher sales of the drug Humira and said it will buy cancer drug developer StemCentrx for more than $5.8 billion.
The drugmaker's first-quarter profit rose 32% to $1.35 billion, or 83 cents per share. Earnings, adjusted for non-recurring costs and amortization costs, came to $1.15 per share.
The results exceeded Wall Street expectations. The average estimate of nine analysts surveyed by Zacks Investment Research was for earnings of $1.12 per share.
The North Chicago, Illinois-based company saw revenue rise 18.2% to $5.96 billion in the period, also topping Street forecasts. Four analysts surveyed by Zacks expected $5.91 billion.
The revenue boost came mainly from a 14.9% boost in sales of Humira to $3.58 billion. The drug is approved to treat arthritis, plaque psoriasis, Cohn's disease, and other conditions.
Meanwhile, the company is buying StemCentrx for $5.8 billion in cash and stock, with potential future development payments of up to $4 billion. StemCentrx, based in South San Francisco, California, has a potential lung cancer treatment in late-stage development. AbbVie said the purchase will help boost its long-term growth and development of cancer treatments.
AbbVie said it expects full-year earnings in the range of $4.62 to $4.82 per share, down by 20 cents from its previous range because of the impact of the StemCentrx deal. Analysts surveyed by FactSet expect $4.96 per share, on average.
AbbVie shares have climbed 2.5% since the beginning of the year, while the Standard & Poor's 500 index has climbed 2.5%. The stock has decreased nearly 7% in the last 12 months. In morning trading the stock fell 4.4% to $58.