Eli Lilly on Thursday reported second-quarter earnings and income that blew previous expectations and hiked its full-year income outlook by $3 billion as gross sales of its blockbuster diabetes drug Mounjaro and weight reduction injection Zepbound spike.
Shares of Eli Lilly jumped greater than 7% on Thursday.
The drugmaker now expects income for the yr to come back in between $45.4 billion and $46.6 billion, a rise of $3 billion at each ends of the vary.
The corporate additionally raised its full-year adjusted earnings to a variety of $16.10 to $16.60, up from a earlier steerage of $13.50 to $14 per share.
Eli Lilly stated the steerage improve was primarily pushed by the robust efficiency of Mounjaro and Zepbound and is available in half attributable to “improved readability” into the corporate’s manufacturing expansions and deliberate launches of Mounjaro outdoors the U.S. The corporate stated it hit a number of provide associated milestones through the quarter, with out offering particular particulars.
Demand has far outstripped provide for incretin medication corresponding to Zepbound and Mounjaro, which mimic hormones produced within the intestine to suppress an individual’s urge for food and regulate their blood sugar. That has compelled Eli Lilly and its rival Novo Nordisk to take a position closely to spice up manufacturing.
However Eli Lilly’s provide woes could also be beginning to ease. On Friday, the Meals and Drug Administration’s drug database stated all doses of Zepbound and Mounjaro can be found within the U.S. after prolonged shortages.
Nonetheless, the corporate cautioned that anticipated will increase in demand could end in periodic “provide tightness” for sure doses of its incretin medication.
“We simply see unbelievable demand, and we’re not even attempting that onerous to advertise this drug,” Eli Lilly CEO David Ricks advised CNBC in an interview. “What you are seeing is simply shopper natural demand right here as we have shipped extra product, as we deliver extra provide on-line in the USA.”
Ricks stated the corporate has constructed six manufacturing vegetation, a few of that are already ramping up, and employed hundreds of employees to extend manufacturing. Eli Lilly expects incretin drug manufacturing within the second half of 2024 to be 50% larger than it was throughout the identical interval final yr, he famous.
“We’re on that form of ramp into 2025,” he stated. Ricks added that Eli Lilly continues to be creating extra handy weight reduction drugs, which might assist the corporate meet skyrocketing demand.
Here is what Eli Lilly reported for the second quarter in contrast with what Wall Road was anticipating, based mostly on a survey of analysts by LSEG:
- Earnings per share: $3.92 adjusted vs. $2.60 anticipated
- Income: $11.30 billion vs. $9.92 billion anticipated
The pharmaceutical big booked web earnings of $2.97 billion, or $3.28 a share, for the second quarter. That compares with a revenue of $1.76 billion, or $1.95 a share, a yr earlier.
Excluding one-time gadgets related to the worth of intangible property and different changes, Eli Lilly posted earnings of $3.92 per share for the second quarter of 2024.
The corporate posted second-quarter income of $11.30 billion, up 36% from the identical interval a yr in the past.
Eli Lilly stated gross sales had been largely pushed by larger demand for Mounjaro and Zepbound as manufacturing will increase improved provide within the U.S.
It’s Zepbound’s second full quarter on the U.S. market after successful approval from regulators in November. The weekly injection raked in $1.24 billion in gross sales for the interval, which is properly above the $922.2 million that analysts anticipated, in response to StreetAccount.
As of July 1, Zepbound was accessible on about 86% of the business insurance coverage protection lists within the U.S., Eli Lilly executives stated throughout an earnings name Thursday. That is up from 67% as of April 1, in response to a first-quarter earnings presentation.
In the meantime, Mounjaro took in $3.09 billion in income for the second quarter, greater than triple the gross sales it booked through the year-earlier interval. Analysts anticipated $2.39 billion in gross sales, in response to StreetAccount.
Mounjaro costs had been larger within the U.S. through the second quarter, which got here partly attributable to larger entry to the drug and decreased use of financial savings card packages in contrast with the year-earlier interval.
However the firm stated financial savings playing cards ought to have “minimal impact” on realized worth comparisons within the second half of the yr as a result of the $25 month-to-month coupon for sufferers who haven’t got insurance coverage protection for Mounjaro expired in June.
Ricks advised CNBC that pricing of Eli Lilly’s incretin medication was “fairly secure” through the second quarter.
In the course of the name, executives additionally stated the corporate expects secure pricing sequentially throughout quarters this yr, with no uncommon tendencies.
That differs from Novo Nordisk, which reported weaker-than-expected second-quarter gross sales of its weight reduction drug Wegovy and diabetes injection Ozempic on Wednesday partly attributable to pricing stress.
Income from Wegovy was hit by higher-than-expected worth concessions to U.S. pharmacy profit managers, which negotiate drug reductions with producers on behalf of insurers, Novo Nordisk executives stated on an earnings name Wednesday.
Shares of Eli Lilly are up greater than 30% this yr after leaping nearly 60% in 2023 as a result of hovering demand for the corporate’s weight reduction and diabetes medication – and elevated investor curiosity of their potential as therapies for different well being situations. That reputation comes regardless of their hefty month-to-month worth tags, inconsistent insurance coverage protection and intermittent provide shortages.
With a market cap of greater than $730 billion, Eli Lilly is the biggest pharmaceutical firm based mostly within the U.S.
