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AbbVie Finance

To make a remarkable impact on patients' lives through innovative medicines by delivering financial excellence across global operations

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To make a remarkable impact on patients' lives through innovative medicines by delivering financial excellence across global operations

Strengths

  • PORTFOLIO: Strong diversification beyond Humira with Skyrizi & Rinvoq
  • FINANCIAL: Robust operating margin at 52% exceeding industry averages
  • ACQUISITION: Strategic integration of Allergan expanding aesthetics reach
  • PIPELINE: 90+ compounds in clinical development across key therapeutics
  • CASH: Significant cash flow enabling dividend growth and debt reduction

Weaknesses

  • RELIANCE: Humira revenue erosion facing 37% US biosimilar competition
  • DEBT: High leverage ratio of 3.4x following major acquisitions
  • GEOGRAPHY: Over-concentration with 75% of revenue from US market
  • COMPETITION: Intensifying rivalry in immunology therapeutic categories
  • TALENT: Challenges in attracting specialized finance expertise globally

Opportunities

  • EXPANSION: International market penetration for Skyrizi and Rinvoq
  • TECHNOLOGY: Cloud-based financial systems to enhance global visibility
  • ESG: Enhanced sustainability reporting to attract impact investors
  • PARTNERSHIPS: Strategic collaborations to share R&D investment costs
  • ANALYTICS: Advanced data modeling to optimize portfolio investments

Threats

  • PRICING: Growing government pressure on pharmaceutical pricing
  • REGULATION: Changing tax policies affecting global operations
  • COMPETITION: New biosimilars challenging established product lines
  • ECONOMIC: Inflation impacts on operating costs and profitability
  • TALENT: Industry-wide competition for specialized finance personnel

Key Priorities

  • DIVERSIFICATION: Accelerate revenue growth beyond Humira dependency
  • TRANSFORMATION: Modernize global financial systems and analytics
  • EFFICIENCY: Optimize cost structure to maintain industry-leading margins
  • INTERNATIONAL: Expand geographic revenue footprint beyond US market
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To make a remarkable impact on patients' lives through innovative medicines by delivering financial excellence across global operations

DIVERSIFY GROWTH

Accelerate non-Humira revenue streams globally

  • PIPELINE: Build financial models for top 5 late-stage compounds with NPV analysis and market sizing completed by Q3
  • INTERNATIONAL: Increase non-US revenue contribution from 25% to 30% through pricing strategy optimization by EOY
  • FORECASTING: Implement rolling 8-quarter forecasting model for immunology portfolio with 90% accuracy by Q3
  • INVESTMENT: Complete ROI analysis on R&D allocation across therapeutic areas to optimize capital deployment
MODERNIZE SYSTEMS

Transform finance with integrated digital capabilities

  • AUTOMATION: Implement AI-powered accounts payable automation reducing processing time by 40% across global operations
  • INTEGRATION: Complete phase 1 of global ERP harmonization connecting 75% of business units by Q4 deadline
  • ANALYTICS: Launch cloud-based financial analytics platform with real-time reporting for top 10 KPIs by September
  • TALENT: Upskill 85% of finance team on data analytics and visualization tools through certification program
OPTIMIZE COSTS

Maintain industry-leading margins amid competition

  • EFFICIENCY: Reduce SG&A as percentage of revenue from 21% to 19.5% through strategic cost initiatives by EOY
  • PROCUREMENT: Implement AI-driven spend analytics platform generating $125M in annual savings by Q4 2025
  • WORKING CAPITAL: Improve cash conversion cycle by 5 days through enhanced receivables and inventory management
  • AUTOMATION: Deploy RPA for 15 core financial processes reducing FTE requirements by 8% while improving accuracy
EXPAND GLOBALLY

Balance geographic revenue footprint strategically

  • MARKETS: Complete financial infrastructure implementation in 5 high-growth emerging markets by December
  • PRICING: Develop dynamic pricing models for top 3 products in EU markets accounting for biosimilar competition
  • COMPLIANCE: Implement automated global tax optimization system reducing effective tax rate by 1.5% by year-end
  • PARTNERSHIPS: Complete financial evaluation of 3 strategic distribution partnerships for Asia-Pacific expansion
METRICS
  • OPERATING MARGIN: 53%
  • NON-HUMIRA REVENUE: $43B (70% of total revenue)
  • FREE CASH FLOW: $19B
VALUES
  • Transforming lives
  • Acting with integrity
  • Driving innovation
  • Embracing diversity & inclusion
  • Serving the community
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Align the learnings

AbbVie Finance Retrospective

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To make a remarkable impact on patients' lives through innovative medicines by delivering financial excellence across global operations

What Went Well

  • IMMUNOLOGY: Skyrizi and Rinvoq exceeded forecasts with combined $11B revenue
  • MARGIN: Maintained 52% operating margin despite Humira biosimilar challenges
  • NEUROSCIENCE: 33% growth in therapeutic area surpassing market expectations
  • CASH: Generated $17.4B in operating cash flow supporting capital allocation
  • DEBT: Reduced outstanding debt by $8.5B exceeding reduction targets by 10%

Not So Well

  • HUMIRA: Revenue declined 35% YoY with acceleration in competitive pressure
  • AESTHETICS: Botox Cosmetic revenue lower than projected by approximately 4%
  • INTERNATIONAL: Continued underperformance in emerging markets expansion goals
  • EFFICIENCY: SG&A expenses remained above targeted percentage of revenues by 1%
  • GUIDANCE: Street reacted negatively to conservative forward-looking estimates

Learnings

  • PIPELINE: Earlier-stage projects require more rigorous financial evaluation
  • ACQUISITION: Integration timelines for financial systems need extension by 15%
  • FORECASTING: Current models underestimated biosimilar market penetration rates
  • OPERATIONS: Geographic market-specific pricing strategies improve profitability
  • INVESTMENT: R&D allocation model requires rebalancing toward earlier discovery

Action Items

  • TRANSFORM: Implement end-to-end finance systems modernization by Q4 2025
  • OPTIMIZE: Reduce operational expenses by 3% through automation and outsourcing
  • DIVERSIFY: Accelerate international market expansion for immunology portfolio
  • ACCELERATE: Enhance predictive analytics capabilities for portfolio decisions
  • RESTRUCTURE: Realign finance organization to support therapeutic area growth
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To make a remarkable impact on patients' lives through innovative medicines by delivering financial excellence across global operations

Strengths

  • INFRASTRUCTURE: Established data lakes supporting AI implementation
  • INVESTMENT: Dedicated innovation funding for finance AI initiatives
  • TALENT: Strategic recruitment of data scientists and AI specialists
  • LEADERSHIP: Executive buy-in for AI-driven financial transformation
  • CULTURE: Growing analytical mindset across finance organization

Weaknesses

  • INTEGRATION: Siloed systems limiting comprehensive data utilization
  • STANDARDIZATION: Inconsistent data formats across global operations
  • EXPERTISE: Limited specialized AI talent in pharmaceutical finance
  • GOVERNANCE: Underdeveloped AI ethics and regulatory frameworks
  • ADOPTION: Variable acceptance of AI solutions among finance teams

Opportunities

  • FORECASTING: ML-driven revenue and expense prediction models
  • AUTOMATION: AI-powered procure-to-pay and order-to-cash processes
  • ANALYTICS: Predictive analytics for portfolio investment optimization
  • COMPLIANCE: AI monitoring of regulatory changes across global markets
  • EFFICIENCY: Intelligent automation of routine financial operations

Threats

  • SECURITY: Data privacy concerns with sensitive financial information
  • REGULATION: Evolving AI governance requirements in healthcare
  • INVESTMENT: Competition for AI talent driving compensation costs
  • DEPENDENCY: Over-reliance on third-party AI platforms and solutions
  • DISRUPTION: Changing organizational dynamics with AI implementation

Key Priorities

  • AUTOMATION: Deploy AI solutions for core financial processes
  • PREDICTION: Implement ML-driven forecasting and scenario planning
  • GOVERNANCE: Develop robust AI ethics and security frameworks
  • UPSKILLING: Enhance AI literacy across the finance organization