Hopes were high coming into Eli Lilly’s second-quarter earnings results. But they should have been even higher.
On Thursday, the Indianapolis drugmaker announced that it was once again upping its revenue expectations for the full year — by $3 billion — after its diabetes and obesity medicines become less supply-constrained and it said it has “increased confidence” in production ramp-up for the rest of this year.
The quarterly results sent Lilly’s shares $LLY up almost 12% before Thursday’s opening bell. And they come just a day after its biggest competitor, Novo Nordisk, disappointed investors despite reporting substantial growth of its own.
Lilly now expects its annual sales to reach $45.4 billion to $46.6 billion, up from a range of $42.4 to $43.6 billion reported last quarter. And its GLP-1 franchise of weight loss and diabetes drugs, including Mounjaro, Zepbound and Trulicity, accounted for roughly half of the company’s quarterly sales.
Dave Ricks“Mounjaro, Zepbound and Verzenio led our strong financial performance in the second quarter as we advanced our manufacturing expansion agenda, and it is equally exciting to see the growth around the world of our medicines for cancer, neurological disorders and autoimmune diseases,” Lilly CEO David Ricks said in a statement.
Both Lilly and Novo have seen their GLP-1 franchises become less supply-constrained in recent days, with updates to an FDA database saying more dosages of the drugs are now available. But Lilly could now have an advantage over Novo in the race for an expanded label for heart failure with preserved ejection fraction, or HFpEF.
Novo is pulling its application to wait for cardiovascular outcomes data later this year in the hopes of snagging a stronger label update for semaglutide. With that resubmission expected early next year, Lilly might now have a three-month lead on Novo, Leerink Partners analyst David Risinger wrote in an Aug. 7 note. “It is also likely, in our view, that sema cannot match the 38% risk reduction that tirzepatide showed” in a Phase 3 last week, Risinger said.
Meanwhile, Lilly disclosed three Phase 1 asset culls, including a GITR antagonist in immunology, an NRG4 agonist in heart failure and a PI3K selective candidate for cancer.
In the past quarter, Lilly also expanded its neuroscience work with the long-awaited approval of the Alzheimer’s drug Kisunla. Biogen and Eisai, an earlier duo in the anti-amyloid market, have seen a slow ramp-up of sales for their medicine Leqembi given the healthcare system complexities of delivering the treatment, which clinicians have said has a modest benefit.
Editor’s note: The top of this story has been updated throughout.