The Revenue Potential for AbbVie Inc. (NYSE:ABBV) With Hepatitis C Treatment

AbbVie Inc. (NYSE:ABBV) has not been a big player in the market for the treatment of any disease. However, recently, the company has intimated forecasted figures for its new Hepatitis C treatment, which, according to released reports, are going to bring in amazing revenues for the company in the current year. Just last month, AbbVie Inc. (NYSE:ABBV) had finally secured approval of the FDA for the production of its then under-development Hepatitis C treatment drug, targeting to cure Hepatitis C of genotype 1.

According to reports, the company was able to secure the FDA approval after it showcased over 90% success rate in clinical trials without showing any dire side effects directly associative with the use of the drug treatment. Approval of the new drug has been welcomed by industry professionals, experts, and consumers alike, who were previously at the mercy of the only two available Hepatitis C drugs available in the market, one called Sovaldi, the other Harvoni.

Both drugs are currently manufactured by Gilead Sciences, and generate billions of dollars in revenue for the company each year due to the heavy price tags associated with the drugs. Now, with new competition entering the market, drug prices will surely fall, making lives easier for those in need of the essential Hepatitis drugs. Treatment of Hepatitis C has been anything but easy for those in need of the treatment. In the past, the treatment required the usage of peg interferon as well as ribavirin, two essential drugs for the treatment of Hepatitis C.

However, this treatment cost $27,000 per session, carried with it many side effects, and had a 50% success rate. Then, Vertex Pharmaceuticals entered the market with Incivek, which carried a price tag of over $50,000 per dose. However, Incivek proved much better than the previously available alternatives, having an over 80% success rate in its treatment. Due to its excessive price tag, combined with its high success rate, the drug became an instant hit, and started generating billions of dollars in revenue for the company.

Only last year, Sovaldi by Gilead Sciences entered the market with $84,000 price tag, and a success rate of over 90% with each dose. The general trend, as is evident, has been that which each significant improvement in Hepatitis C treatment, costs have also increased significantly. The reason behind this has been the fact that these drugs have stood undisputed in the market whenever they’ve been released. Now, with the launch of AbbVie Inc. (NYSE:ABBV)’s new Hepatitis C drug treatment offering the same level of success as Sovaldi, prices for both are sure to come down.

For the first time, Hepatitis C drugs in the market will compete with each other to get the most market share, which in turn will drive prices down. But one thing is certain demand for AbbVie Inc. (NYSE:ABBV)’s drug is sure to be significant, and if the price tag is anywhere close to that being charged for Sovaldi, AbbVie Inc. (NYSE:ABBV) is looking at billions in revenue for itself.