Here's How ALVO's Commercial Partnerships Are Driving Top-line Growth

Biosimilar drugmaker Alvotech ALVO has positioned itself differently from other players in the space by using partnerships as its core commercial model. Rather than investing heavily in its own sales infrastructure, the company relies on distribution alliances to bring products to market across multiple regions. This model enables rapid expansion while allowing Alvotech to concentrate its resources on development and manufacturing.

The strategy seems to be working well for the company. In the first half of 2025, Alvotech’s product revenues surged more than 200% year over year to nearly $205 million. A significant portion of this growth came from the product revenues of its two immunology biosimilars — Simlandi (a biosimilar to AbbVie’s Humira) and Selarsdi (a biosimilar to J&J’s Stelara) — which are marketed in the United States by partner Teva Pharmaceuticals TEVA. Alvotech has a similar partnership with Germany-based Stada to market biosimilar versions of Humira and Stelara under the names Hukyndra and Uzpruvo, respectively. Sales of both these products have rapidly scaled, helping Alvotech reaffirm its full-year 2025 revenue guidance of $600 million to $700 million.

These partnerships have also helped the company diversify income beyond product sales. ALVO has agreements with companies like Teva, Dr. Reddy’s Laboratories RDY and Advanz Pharma that include upfront and milestone payments upon achieving regulatory approvals or reaching commercial milestones. Such incomes provide the company with a steadier cash position, which is especially valuable in the capital-intensive biosimilar business.

Diversification: The Next Move in ALVO’s Playbook?

The company is also making efforts to expand beyond the immunology space. Alvotech recently secured approval in the EU for Mynzepli, its biosimilar to Regeneron’s Eylea, through a partnership with Advanz Pharma. This marks its entry into ophthalmology, one of the fastest-growing therapeutic areas in the biosimilar landscape.

In addition, ALVO also expanded its partnerships with Dr. Reddy’s and Advanz Pharma, announcing plans to develop multiple biosimilar candidates across neurology and oncology. These include developing biosimilars for Novartis’ Kesimpta and Merck’s Keytruda, among others. Such strategic moves highlight how Alvotech is leveraging its alliance-driven model not only to scale existing products but also to build a broader, future-facing pipeline that could support sustained top-line momentum.

ALVO’s Price Performance, Valuation and Estimates

Shares of Alvotech have underperformed the industry year to date, as seen in the chart below.

From a valuation standpoint, ALVO is trading at a premium to the industry. Going by the price-to-sales (P/S) ratio, the company’s shares currently trade at 3.23 times trailing sales, higher than 2.12 for the industry.

Alvotech’s EPS estimates for 2025 and 2026 have improved significantly in the past 30 days.

Alvotech currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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