AbbVie Inc. is an Illinois-based pharmaceutical company that specializes in the production of biopharmaceuticals. It is the manufacturer of the blockbuster medication, Humira which has been the number 3 top selling drug in the US and is used to treat autoimmune disorders such as Rheumatoid Arthritis, Psoriasis, and Crohns disease. Humira generated estimated worldwide sales of $10.7 billion in 2013, with over $5.3 billion in the US alone.
AbbVie manufactures 30 products that are marketed in over 170 countries worldwide with total 2013 global revenue of $18.8 billion and has approximately 25,000 employees. AbbVie has over 20 products in their research pipeline in the areas of immunology, endocrinology, kidney and liver disease, oncology and neurology. The company also manufactures AndroGel, a number 35 top-selling testosterone replacement gel that generated $1.4 billion in 2013 sales.
Testosterone replacement therapy is approved to treat hypogonadism with low testosterone levels in men. AndroGel and other topical testosterone replacement medications have been prescribed for men with “Low-T” but many have never had their levels tested and some statistics have shown that 2 percent of all men over the age of 40 may be taking testosterone replacement therapy (TRT) for “Low-T” symptoms, many of which are similar to natural occurrences of aging and may not be attributed to low testosterone at all.
Even though there are a large number of testosterone replacement products on the market, AndroGel, produced by AbbVie garners approximately 60 percent of the market for testosterone replacement. Sales of testosterone products have nearly doubled in the past 5 years with the total market currently estimated at over $2 billion annually. The medication has caused severe side effects for hundreds of men resulting in personal injury lawsuits against AbbVie and other manufacturers.
History of AbbVie and Abbott
Abbott Laboratories was once one of the largest pharmaceutical companies in the world with a history dating back to 1888 with the “new” idea of production of “dosimetric granules” or tiny pills that offered a dramatic improvement over the handmade tablets that were produced by individual pharmacists.
AbbVie was spun off from the pharmaceutical giant Abbott in 2012. It was the second spin-off undertaken by Abbott Laboratories who had split in 2004 to form a separate company, Hospira. Hospira took the hospital products division from Abbott to become the largest US manufacturer of injectable drugs and infusion technologies. Hospira produced more than $4 billion in 2013 revenue and is publicly traded as HSP on the NYSE.
In the 2012 split, AbbVie was established as the primary research and development company of Abbott’s branded pharmaceuticals and took the top Abbott products including Humira, AndroGel, Vicodin, Kaletra, TriCor and Niaspan. Abbott retained the diagnostics, medical devices, and nutritional divisions, along with the company name and a large generics business. In the first year of trading as a separate publicly listed product, AbbVie (ABBV) showed revenue of nearly $18.8 billion in worldwide sales.
Abbott Product Issues
Though AbbVie is now facing some legal difficulties with AndroGel, the product was originally produced by Abbott Laboratories who also has a history of trouble with recalls, manufacturing violations and improper marketing dating back to the late 1960’s and before.
Some of the most notable issues include a recall of over 200 products from 1969 to 1971 because of reports of bacterial blood poisoning or septicemia which resulted in at approximately 50 deaths and 400 injuries from contaminated IV solutions. A 1971 for-cause investigation by the FDA found “objectionable” conditions of the building and equipment at Abbott’s North Carolina manufacturing plant where the IV solutions originated.
Abbott and five company officials were indicted for violation of interstate shipping regulations due to the contaminated products, and though all charges were dismissed, a 1976 report from the Centers for Disease Control and the FDA indicated bacterial contamination of the screw cap closures of the solutions.
In 2012, the company was accused of illegal marketing of Depakote, a top-selling anti-seizure medication and agreed to pay $1.6 billion to settle the claims. In 2013, Abbott was fined $524 million for paying kickbacks to physicians who used Abbott medications to treat circulatory disorders. A slew of blood glucose monitoring devices were also recalled in February of 2014.
With the 2013 split, AbbVie has assumed partial liability for the brand-name pharmaceutical products including AndroGel, though Abbott may still be named in lawsuits.
AbbVie and Testosterone Replacement
AndroGel is the number one selling testosterone replacement product and the second largest AbbVie revenue producer. Like other testosterone products, AndroGel is approved to treat men with hypogonadism, a condition in which the male testes do not make enough testosterone. Millions of men are using testosterone replacement therapy for “Low-T” which is a term used in marketing of the therapy.
Estimates show that over half of the men who use “Low-T” products, have not been tested for low testosterone levels and may not have the condition. Testosterone has been shown to increase the risk of dangerous and possibly deadly medical conditions such as:
- Heart Attack
- Development of Blood Clots
Testosterone can also cause other side effects such as:
- Increases in sleep apnea
- Low sperm counts (oligospermia)
- Breast development in men (gynecomastia)
- Aggressive behavior
- Weight gain and edema
When a woman or a child comes into contact with the gel, even by skin to skin contact with a man using testosterone topical treatments, problems related to the hormone can develop such as:
- Premature puberty in boys
- Gynecomastia in boys
- Masculinization in women and girls (body hair growth, weight gain, deepening of the voice)
- Reproduction abnormalities
Recent studies and cases indicating a clear threat of severe side effects such as stroke, heart attack and blood clot risk have prompted the Food and Drug Administration to re-examine TRT products. Many men have been injured by testosterone replacement and several deaths are attributed to the medication. Hundreds of lawsuits have been filed against manufactures of testosterone replacement medications including many by users of AbbVie’s popular product, AndroGel.
Lawsuits claim that AbbVie and Abbott used aggressive marketing tactics with the “Low-T” approach and did not encourage the testing of blood concentrations of testosterone. Attorneys for the plaintiffs also claim that the manufacturers have downplayed the risk of serious adverse events which have resulted in permanent or life-threatening medical conditions. None of the testosterone lawsuits have been settled and many more are expected.
AbbVie in the Future
AbbVie has over 20 medications in the “late-stage” pipeline, which means approval may take place in the next several years if shown to be safe and effective. Dozens of additional pipeline drugs are in early stage development.
One of AbbVie’s most promising treatments is for Hepatitis C, a chronic and potentially deadly disease that affects millions of people and estimates show that this combination treatment could easily generate $2.8 billion per year.
Humira remains the top product in AbbVie’s portfolio and though Humira may lose patent protection in the near future, a generic is unlikely to be produced as the medication is a complex biological medication. Sales of Humira may reach $12 billion in 2014 which may make it the top-selling medication in the US.
No announcements have been made about AbbVie’s plans for AndroGel lawsuit settlements but many more lawsuits may be expected.