AbbVie Reports Second-Quarter 2019 Financial Results

AbbVie Reports Second-Quarter 2019 Financial Results

NORTH CHICAGO, Ill., July 26, 2019 - AbbVie (NYSE:ABBV) announced financial results for the second quarter ended June 30, 2019.

"We continue to see strong momentum in our business, as we delivered revenue and adjusted EPS ahead of our expectations for the quarter and announced plans to acquire Allergan, a transformative transaction that will provide scale and diversity to our business and position AbbVie for top-tier performance over the long term," said Richard A. Gonzalez, chairman and chief executive officer, AbbVie. "Based on our strong performance year-to-date and our confidence in the outlook for the second half, we are raising our revenue and adjusted EPS guidance for 2019."

Note: "Operational" comparisons are presented at constant currency rates and reflect comparative local currency net

revenues at the prior year's foreign exchange rates.

Second-Quarter Results

Note: "Operational" comparisons are presented at constant currency rates and reflect comparative local currency net

revenues at the prior year's foreign exchange rates.

Recent Events (continued)

Full-Year 2019 Outlook

AbbVie is updating its GAAP diluted EPS guidance for the full-year 2019 from $7.26 to $7.36 to $5.69 to $5.79, representing growth of 56.8 percent at the midpoint, inclusive of a non-cash charge for SKYRIZI contingent consideration following regulatory approvals in the second quarter. AbbVie is raising its previously announced adjusted EPS guidance range for the full-year 2019 from $8.73 to $8.83 to $8.82 to $8.92, representing growth of 12.1 percent at the midpoint. The company's 2019 adjusted diluted EPS guidance excludes $3.13 per share of intangible asset amortization expense, non-cash charges for contingent consideration adjustments and other specified items.

Statements Required by the Irish Takeover Rules

The earnings guidance contained in this press release constitutes a profit forecast for the purposes of the Irish Takeover Rules. In accordance with Rule 28.4 of the Irish Takeover Rules, this profit forecast shall be repeated in the proxy statement, including the scheme document and the reports required by Rule 28.3 of the Irish Takeover Rules shall be mailed to Allergan shareholders with the proxy statement, including the scheme document.

The directors of AbbVie accept responsibility for the information contained in this announcement. To the best of the knowledge and belief of the directors of AbbVie (who have taken all reasonable care to ensure that such is the case), the information contained in this announcement is in accordance with the facts and does not omit anything likely to affect the import of such information.

Any holder of 1% or more of any class of relevant securities of AbbVie Inc. may have disclosure obligations under Rule 8.3 of the Irish Takeover Panel Act, 1997, Takeover Rules 2013.

AbbVie is a global, research-driven biopharmaceutical company committed to developing innovative advanced therapies for some of the world's most complex and critical conditions. The company's mission is to use its expertise, dedicated people and unique approach to innovation to markedly improve treatments across four primary therapeutic areas: immunology, oncology, virology and neuroscience. In more than 75 countries, AbbVie employees are working every day to advance health solutions for people around the world. For more information about AbbVie, please visit us at www.abbvie.com. Follow @abbvie on Twitter, Facebook or LinkedIn.

AbbVie will host an investor conference call today at 8:00 a.m. Central time to discuss our second-quarter performance. The call will be webcast through AbbVie's Investor Relations website at investors.abbvie.com. An archived edition of the call will be available after 11:00 a.m. Central time.

Non-GAAP Financial Results

Financial results for 2019 and 2018 are presented on both a reported and a non-GAAP basis. Reported results were prepared in accordance with GAAP and include all revenue and expenses recognized during the period. Non-GAAP results adjust for certain non-cash items and for factors that are unusual or unpredictable, and exclude those costs, expenses, and other specified items presented in the reconciliation tables later in this release. AbbVie's management believes non-GAAP financial measures provide useful information to investors regarding AbbVie's results of operations and assist management, analysts, and investors in evaluating the performance of the business. Non-GAAP financial measures should be considered in addition to, and not as a substitute for, measures of financial performance prepared in accordance with GAAP. The company's 2019 financial guidance is also being provided on both a reported and a non-GAAP basis.

No Offer or Solicitation

This release is not intended to and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy or an invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the proposed acquisition of Allergan or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. In particular, this release is not an offer of securities for sale into the United States. No offer of securities shall be made in the United States absent registration under the U.S. Securities Act of 1933, as amended, or pursuant to an exemption from, or in a transaction not subject to, such registration requirements. Any securities issued in the proposed acquisition are anticipated to be issued in reliance upon available exemptions from such registration requirements pursuant to Section 3(a)(10) of the U.S. Securities Act of 1933, as amended. The proposed acquisition will be made solely by means of the scheme document (or, if applicable, the takeover offer document), which will contain the full terms and conditions of the proposed acquisition, including details with respect to the Allergan shareholder vote in respect of the proposed acquisition. Any decision in respect of, or other response to, the proposed acquisition, should be made only on the basis of the information contained in the scheme document.

Forward-Looking Statements

Some statements in this news release are, or may be considered, forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "project" and similar expressions, among others, generally identify forward-looking statements. AbbVie cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to, the possibility that the proposed acquisition of Allergan will not be pursued, failure to obtain necessary regulatory approvals or required financing or to satisfy any of the other conditions to the proposed acquisition, failure to realize the expected benefits of the proposed acquisition, failure to promptly and effectively integrate Allergan's businesses, significant transaction costs and/or unknown or inestimable liabilities, potential litigation associated with the proposed acquisition, challenges to intellectual property, competition from other products, difficulties inherent in the research and development process, adverse litigation or government action, and changes to laws and regulations applicable to our industry. Additional information about the economic, competitive, governmental, technological and other factors that may affect AbbVie's operations is set forth in Item 1A, "Risk Factors," of AbbVie's 2018 Annual Report on Form 10-K, which has been filed with the Securities and Exchange Commission (SEC). AbbVie undertakes no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments, except as required by law.

Key Product Revenues

Quarter Ended June 30, 2019

Note: "Operational" comparisons are presented at constant currency rates and reflect comparative local currency net revenues at the prior year's foreign exchange rates.

n/a = not applicable

n/m = not meaningful

Key Product Revenues

Six Months Ended June 30, 2019

Note: "Operational" comparisons are presented at constant currency rates and reflect comparative local currency net revenues at the prior year's foreign exchange rates.

n/a = not applicable

n/m = not meaningful

Consolidated Statements of Earnings

Quarter and Six Months Ended June 30, 2019 and 2018

(Unaudited) (In millions, except per share data)

Reconciliation of GAAP Reported to Non-GAAP Adjusted Information

Quarter Ended June 30, 2019

(Unaudited) (In millions, except per share data)

1. Specified items impacted results as follows:

Milestones and other R&D expenses are associated with milestone payments for previously announced collaborations. Acquired IPR&D primarily reflects upfront payments related to R&D collaborations and licensing arrangements with third parties. Restructuring is primarily associated with streamlining global operations. Acquisition related costs reflect transaction and financing costs related to the proposed Allergan acquisition.

2. The impact of the specified items by line item was as follows:

3. The adjusted tax rate for the second quarter of 2019 was 8.7 percent, as detailed below:

Reconciliation of GAAP Reported to Non-GAAP Adjusted Information

Quarter Ended June 30, 2018

(Unaudited) (In millions, except per share data)

1. Specified items impacted results as follows:

Milestones and other R&D expenses are associated with milestone payments for previously announced collaborations. Impacts of U.S. tax reform reflects a net tax benefit related to the timing of the legislation's phase in on certain subsidiaries. Other primarily includes milestone revenue under a previously announced collaboration.

2. The impact of the specified items by line item was as follows:

3. The adjusted tax rate for the second quarter of 2018 was 9.0 percent, as detailed below:

Reconciliation of GAAP Reported to Non-GAAP Adjusted Information

Six Months Ended June 30, 2019

(Unaudited) (In millions, except per share data)

1. Specified items impacted results as follows:

Milestones and other R&D expenses are associated with milestone payments for previously announced collaborations. Acquired IPR&D primarily reflects upfront payments related to R&D collaborations and licensing arrangements with third parties. Restructuring is primarily associated with streamlining global operations. Acquisition related costs reflect transaction and financing costs related to the proposed Allergan acquisition.

2. The impact of the specified items by line item was as follows:

3. The adjusted tax rate for the first six months of 2019 was 8.3 percent, as detailed below:

Reconciliation of GAAP Reported to Non-GAAP Adjusted Information

Six Months Ended June 30, 2018

(Unaudited) (In millions, except per share data)

1. Specified items impacted results as follows:

Milestones and other R&D expenses are associated with milestone payments for previously announced collaborations. Acquired IPR&D primarily reflects upfront payments related to R&D collaborations and licensing arrangements with third parties. Impacts of U.S. tax reform reflects a net tax benefit related to the timing of the legislation's phase in on certain subsidiaries. Other primarily includes milestone revenue under a previously announced collaboration and restructuring charges associated with streamlining global operations.

2. The impact of the specified items by line item was as follows:

3. The adjusted tax rate for the first six months of 2018 was 8.3 percent, as detailed below: