Eli Lilly Shows Progress in Weight Loss Drug Zepbound

Eli Lilly's stock has seen a significant increase of over 7% after the company reported impressive second-quarter earnings, driven by robust sales of its weight loss medications, Mounjaro and Zepbound. The two drugs, which utilize the active ingredient tirzepatide, generated $4.33 billion in revenue, surpassing analysts' expectations of $3.35 billion. In response to this strong performance, Lilly has raised its revenue forecast for 2024 by $3 billion, projecting between $45.4 billion and $46.6 billion. The surge in Lilly's stock is largely attributed to its competitive positioning against Novo Nordisk, whose diabetes and obesity treatments, Ozempic and Wegovy, are priced higher than Lilly's offerings. Analysts suggest that this pricing strategy may have pressured Novo's sales, as clinical trial results indicate that Zepbound may be more effective for certain patients. Prescription rates for Mounjaro and Zepbound have also seen significant increases, with Mounjaro prescriptions rising 14% and Zepbound prescriptions soaring by 59% from the first to the second quarter. Lilly reports that access to Zepbound is improving, with 86% of commercial insurance plans now covering the drug. Analysts are optimistic about the future, particularly regarding the potential expansion of tirzepatide's label, which could lead to increased patient usage. JPMorgan analyst Chris Schott anticipates unprecedented growth for Lilly, projecting that its incretin drugs could generate over $68 billion in sales by 2030.