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Analysts project that Mounjaro will be the best-selling drug of all time.
Dreamstime
Sales of
Eli Lilly
‘s diabetes treatment Mounjaro significantly beat Wall Street estimates in the second quarter, sending the drugmaker’s stock higher and extending investor enthusiasm over the medicine.
Lilly (ticker: LLY) shares surged 14.4% Tuesday morning, driven up by the company’s financial results and promising data from competitor
Novo Nordisk
(NVO). Novo Nordisk said a trial of its weight-loss drug Wegovy had reduced the risk of heart attack or stroke in obese and overweight patients by 20%. The results were better than expected, and could push insurers to cover both Novo and Lilly’s weight-loss drugs.
Lilly reported second-quarter revenue of $8.3 billion, better than the FactSet consensus estimate of $7.6 billion. Non-GAAP earnings were $2.11 per share, better than the FactSet consensus estimate of $1.98 per share.
Sales of Mounjaro, which has Food and Drug Administration approval to treat Type 2 diabetes, were $979.7 million, beating the FactSet consensus estimate of $739.8 million. Patients without diabetes who took Mounjaro lost 21.1% of their body weight on average in one trial; Lilly expects the FDA to rule on the company’s application for approval of Mounjaro as an obesity treatment by the end of the year.
Lilly CFO Anat Ashkenazi said on an investor call on Tuesday that insurer coverage for Mounjaro as a Type 2 diabetes treatment continues to expand, and that 73% of U.S. patients with commercial and Medicare Part D insurance coverage now have access. While high demand has kept Mounjaro in short supply, CEO David Ricks said a new manufacturing facility was now on line in North Carolina.
Lilly increased its guidance for full-year sales, now forecasting revenue between $33.4 billion and $33.9 billion, up $2.2 billion from its previous estimate. The company also increased its guidance for full-year non-GAAP earnings: It expects earnings between $9.70 and $9.90 per share, up from its prior range of $8.65 to $8.85 per share.
Eli Lilly shares have been among the few bright spots in the healthcare sector, which has significantly underperformed the broader market. The enthusiasm is focused largely on Mounjaro. Analysts project that the treatment will be the best-selling medicine of all time.
Other Lilly obesity medicines now in clinical development, including one called retatrutide, look likely to improve on Mounjaro over the coming years. In a note in late July, Goldman Sachs analyst Chris Shibutani wrote that he expects $40 billion in combined, risk-adjusted, 2032 sales for Mounjaro, retatrutide, and a weight-loss pill in the Lilly pipeline called orfoglipron.
Beyond Mounjaro, there is donanemab, the Lilly (ticker: LLY) Alzheimer’s disease therapy that works similarly to Leqembi,
Biogen’s
(BIIB) Alzheimer’s drug that received full approval earlier this summer. The FDA rejected Lilly’s request for accelerated approval in January, but the company is expecting a decision on full approval by the end of the year.
Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com
