It was a disappointing week for Eli Lilly shareholders, with the stock plunging more than 11% on Thursday. However, it has clawed back some of those losses on Friday, currently up 3.6%.
Even so, the pharmaceutical giant’s lacklustre earnings and guidance weighed significantly on the shares.
UBS commented that a “solid fundamental 1Q25 performance from LLY” was overshadowed by increasing concerns over pricing of the GLP-1 class, lower expectations from the company for obesity, the withdrawal of tirzepatide’s HFpEF indication, and a Tech-on, Healthcare-off rotation.
Furthermore, the bank highlighted the announcement from Novo that CVS Caremark will prioritise Wegovy ahead of Zepbound on its formularies.
Even so, UBS analysts added that while they understand some of the concerns, they feel the 11% stock price decline on Thursday was an overreaction.
About Eli Lilly
Eli Lilly and Company is a leading global pharmaceutical firm headquartered in Indianapolis, Indiana. Established in 1876 by Colonel Eli Lilly, the company has been at the forefront of medical innovation for nearly 150 years, focusing on transforming scientific discoveries into therapies that improve lives worldwide.
Lilly’s diverse portfolio addresses various therapeutic areas, including diabetes, oncology, neuroscience, and immunology. Notable products include:
- Mounjaro (tirzepatide): A GLP-1/GIP receptor agonist approved for type 2 diabetes and obesity treatment.
- Zepbound: An obesity treatment that, along with Mounjaro, significantly contributed to Lilly’s revenue growth in 2024.
- Trulicity (dulaglutide): A once-weekly injection for type 2 diabetes management.
- Verzenio (abemaciclib): An oral medication for certain types of breast cancer.
In 2024, Eli Lilly reported annual revenues of approximately $45 billion, with projections ranging between $58 billion and $61 billion for 2025, driven by the success of its diabetes and obesity treatments. The company’s market capitalisation reached $842 billion, positioning it as the most valuable pharmaceutical company globally.
Eli Lilly continues to invest heavily in research and development, allocating $9.3 billion in 2023, representing 27.3% of its net sales. The company is also expanding its manufacturing capabilities, with plans to build four new facilities in the United States, marking the largest investment in pharmaceutical manufacturing in the country’s history.
With a strong pipeline and commitment to innovation, Eli Lilly aims to address some of the world’s most pressing health challenges, including obesity, diabetes, and Alzheimer’s disease. The company’s strategic focus on expanding manufacturing, enhancing R&D, and advancing next-generation drugs positions it well for sustained growth and leadership in the pharmaceutical industry.
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