Believe it or not, 2013 is getting close to being two-thirds of the way over. Many pharmaceutical firms have enjoyed great stock returns and nice profits thus far in the year. Those returns and profits stem from medications that racked up solid revenue. Here are the five best-selling medications of 2013 -- at least so far.
It's probably no surprise to anyone that AbbVie'sHumira takes the top spot on our list with more than $4.8 billion in sales during the first half of 2013. Humira ranked No. 1 in worldwide sales in 2012 as well.
Humira is approved for multiple inflammatory diseases including rheumatoid arthritis, placque psoriasis, Crohn's disease, ulcerative colitis, ankylosing spondylitis, psoriatic arthritis, and juvenile ideopathic arthritis. With these approved indications impacting millions across the world, AbbVie continues to see solid growth for the drug. Sales for Humira climbed 12.1% year-over-year during the second quarter.
AbbVie knows that Humira's reign won't go on indefinitely, though. The anti-inflammatory drug goes off patent in the U.S. in December 2016 and loses European patent exclusivity in 2018. Because Humira makes up more than half of AbbVie's total revenue, the company faces significant challenges building up the rest of its portfolio to offset potential losses that loom on the horizon.
Advair/Seretide from GlaxoSmithKline comes in at second place. So far this year, the drug has garnered sales of around $4.1 billion.
GlaxoSmithKline markets its fluticasone/salmeterol formulation for treating asthma and chronic obstructive pulmonary disease, or COPD, under the Advair brand name in the U.S. and as Seretide in many other countries. The Advair/Seretide franchise made up 30% of Glaxo's total sales in the second quarter of 2013.
Although Advair lost patent protection in the U.S. in 2010 and Seretide goes off patent in Europe this year, Glaxo hasn't faced a generic challenger yet. The company has benefited from the U.S. Food and Drug Administration moving slowly on establishing bioequivalance for inhaled corticosteroids in multi-dose inhalers or dry powder inhalers.
The market for rheumatoid arthritis and similar conditions is like the pharmaceutical equivalent of a gold mine. Enbrel, which is used to treat most of the same indications as Humira, ranks as the third-highest-selling drug in the world with more than $4 billion in sales during the first half of 2013.
That money is split between partners Amgen and Pfizer . Amgen reported first-half Enbrel sales of nearly $2.2 billion, while Pfizer's sales for the drug totaled $1.8 billion.Amgen markets the drug along with Pfizer in the U.S. and Canada for now, but their collaboration ends in October of this year. Pfizer holds exclusive marketing rights outside of these areas.
Amgen scored a victory in 2011 by winning a new patent for Enbrel that provides protection through 2028 in the U.S. However, Enbrel's main European patent expires in 2015, which will impact Pfizer. Even with extended protection in the U.S., Amgen can't rest too comfortably. If a biosimilar for Humira enters the market within the next few years, it would likely hurt Enbrel's sales as well as Humira's.
Sanofi claims the No. 4 spot with diabetes drug Lantus. During the first half of this year, sales for Lantus totaled around $3.5 billion.
The diabetes market is huge and counts multiple blockbuster drugs. Lantus has been able to rise to the top in large part due to its convenience. It is long-acting, so patients only have to take it once per day. Sanofi also sells Lantus with its soloSTAR pen that makes it easy for self-injection by patients.
Sanofi's first U.S. patent for Lantus expires in 2014. However, it has other patents, including one for its injection pen, thatSanofi hopes will allow it to fend off competition to some degree. Keeping Lantus going strong will be important for the French drugmaker. The product is its top-seller and accounts for 20% of total pharmaceutical revenue.
Cancer drug Avastin is our fifth top-selling medication for 2013 so far. The drug generated sales of around $3.3 billion for Roche during the first half of the year.
Avastin is currently approved for several types of cancer, including metastatic colorectal cancer, advanced nonsquamous non-small-cell lung cancer, metastatic kidney cancer, and glioblastoma. Roche is also conducting clinical studies for the drug in treating cervical cancer and newly diagnosed glioblastoma.
Roche isn't quite as dependent on its biggest drug as some of the other companies, although Avastin still accounted for 13% of total sales during the first six months of 2013. The company should be able to look forward to several more years of solid revenue. Avastin doesn't go off patent in the U.S. until 2019 and retains patent protection in Europe through 2022.
I expect that all of these drugs will keep their top five ranking at the end of the year. However, there could be a few changes of positions along the way. Also, there is a decent possibility that Roche's Herceptin and Johnson & Johnson's Remicade could nudge their way into the group and displace Avastin and Lantus.
In terms of investment opportunities among the group, AbbVie seems poised to continue exhibiting the strongest growth for the next couple of years. If you're looking for the best value play, Sanofi would likely be the best pick. It sports a low price-to-earnings multiple along with a decent 2.5% dividend yield.
That's how things look for now. We'll check back in at the end of 2013 to see which drugs came out on top for the full year.
Definitely pay attention to the dividends with any of these stocks -- or any other stock you're considering. Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine.