Will AbbVie's Acquisition Spree Aid Pipeline Growth?

AbbVie ABBV has been actively ramping up its deal-making efforts lately, thereby strengthening its pipeline. While immunology remains its core area, the company is also signing some early-stage deals across various other therapeutic areas, including oncology and neuroscience.

Earlier this week, AbbVie signed a definitive agreement to acquire privately held biotech Capstan Therapeutics for a total deal value of nearly $2.1 billion. The transaction, expected to be completed in the third quarter, will add Capstan’s lead asset, CPTX2309 — a potential first-in-class in vivo tLNP anti-CD19 CAR-T therapy — to its immunology pipeline. The acquisition will also add Capstan’s proprietary tLNP platform technology, CellSeeker, which helps deliver RNA, like mRNA, to engineer specific cell types inside the body.

Since the beginning of last year, the company has signed over 20 early-stage deals, including promising technologies and innovative mechanisms that can elevate the standard of care across various therapeutic areas. Earlier this year, AbbVie acquired rights to develop a long-acting amylin analog for the treatment of obesity from Denmark’s Gubra, marking its foray into the obesity space. It also plans to invest further in obesity.

Among some recent larger deals, AbbVie acquired ImmunoGen, which added the ovarian cancer drug Elahere and neuroscience drugmaker Cerevel Therapeutics last year. These acquisitions have not only broadened AbbVie’s therapeutic footprint but also diversified its pipeline across multiple modalities. The augmented pipeline now includes next-generation immunology candidates, bispecifics, antibody-drug conjugates and innovative therapies for neuropsychiatric and neurodegenerative disorders.

We believe ABBV will continue pursuing such deals to further grow its pipeline.

Focus on M&A in 2025

While broader macroeconomic concerns, including Trump-era tariffs and leadership shifts at the FDA, have weighed on deal-making this year, Big Pharma continues to pursue strategic assets in key growth areas.

Last month, Eli Lilly LLY announced its intent to acquire cardiology-focused Verve Therapeutics in a deal valued at up to $1.3 billion. This transaction, which is also expected to close in the third quarter, will mark LLY’s third targeted M&A deal this year. Earlier in January, it signed a $2.5 billion deal for Scorpion Therapeutics’ experimental oncology drug. In May, Lilly agreed to acquire SiteOne Therapeutics for $1 billion to strengthen its neuroscience pipeline. Such deals suggest that LLY’s M&A strategy is selective, focusing on long-term strength across therapeutic areas beyond its dominant presence in obesity.

In June, Sanofi SNY announced a $9.5 billion acquisition of Blueprint Medicines to strengthen its immunology pipeline and reduce reliance on the blockbuster drug Dupixent. Through this transaction, SNY intends to add Ayvakit — an inhibitor of KIT and PDGFRA proteins with growing commercial traction — and several early-stage pipeline assets focused on systemic mastocytosis (SM). Recently, Sanofi completed the acquisition of an investigational bispecific antibody targeting autoimmune diseases from California-based Dren Bio and also agreed to acquire neurology-focused Vigil Neuroscience in a deal valued at around $470 million.

ABBV’s Price Performance, Valuation and Estimates

Shares of AbbVie have outperformed the industry year to date, as seen in the chart below.

From a valuation standpoint, AbbVie is not very cheap. Based on the price/earnings (P/E) ratio, the company’s shares currently trade at 14.42 times forward earnings, slightly lower than its industry’s average of 14.86. The stock is cheaper than some other large drugmakers, such as Eli Lilly and Novo Nordisk, but priced much higher than most other large drugmakers. The stock is also trading above its five-year mean of 12.46.

The Zacks Consensus Estimate for 2025 EPS has risen from $12.26 to $12.28, while that for 2026 has remained consistent at $14.06 over the past 60 days.

AbbVie currently has 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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