AbbVie stock crumbled Wednesday after the company announced President and Vice Chairman Michael Severino will depart at the end of May.
Severino is heading to Flagship Pioneering, the biotech creator behind big names like Moderna, and smaller players Denali Therapeutics and Seres Therapeutics — to name a few. He will become a partner chief executive at Flagship and will head up one of its companies.
He's leaving AbbVie after eight years. In his role, he's been responsible for research and development, and the corporate strategy office. Severino informed AbbVie of his plans on April 8, according to a Securities and Exchange Commission filing.
On the stock market today, AbbVie stock toppled 4.2% to 158.95.
AbbVie Stock Dives As Severino Exits
As a CEO-partner, Severino will help Flagship "create and develop groundbreaking innovations in human health," the company said in a news release.
Severino has worked in drug development for more than two decades. Prior to AbbVie, he worked at Amgen and Merck.
"I am thrilled to take on this role and partner with the high-caliber team of world-class scientists, technologists and business executives assembled by Flagship Pioneering," Severino said in a written statement. "I look forward to applying my experience across all phases of drug discovery, development and commercialization at Flagship, to help make an important difference for patients."
During Severino's tenure, AbbVie added Skyrizi and Rinvoq, two new immunology drugs that could help stanch an expected decline in revenue as Humira — the world's bestselling drug — begins facing cheaper biosimilar rivals in the U.S. Biosimilars to Humira are likely to shake AbbVie stock.
AbbVie also won Food and Drug Administration approval last year for a migraine prevention pill known as Qulipta, a potential rival to Biohaven Pharmaceuticals' Nurtec.
The news of Severino's departure also comes as AbbVie announces the 20-year anniversary of the first FDA approval for Botox. At the time, it was approved as a cosmetic treatment for wrinkles. Now, it's also used to treat migraines, excessive sweating and other conditions.
Shares Hit Their Stride This Year
AbbVie stock has been on a run this year, rising nearly 30% to a record of 175.91 on April 8.
Severino's looming exit sent shares tumbling, but the pharma stock still remains well above its 50-day and 200-day moving averages.
Bullishly, AbbVie stock also has a Composite Rating of 95. This puts shares in the top 5% of all stocks in terms of fundamental and technical measures, according to IBD Digital. The Relative Strength Rating of 96 means AbbVie stock trades in the leading 4% in terms of 12-month performance.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
