Eli Lilly Exceeds Expectations with Zepbound and Mounjaro

Key Points

• Eli Lilly surpasses expectations with Zepbound and Mounjaro sales.
• Zepbound’s strong market entry and Mounjaro’s surging sales.
• Market reacts positively, Eli Lilly becomes a pharmaceutical giant.

Impressive Fourth Quarter Results

Eli Lilly’s fourth quarter financials surpassed Wall Street forecasts, buoyed by the successful launch of its new weight-loss drug, Zepbound, and strong sales of its diabetes treatment, Mounjaro. The company reported adjusted earnings of $2.49 per share, significantly higher than the $2.22 analysts anticipated. Its revenue hit $9.35 billion, exceeding the expected $8.93 billion.

Zepbound’s Strong Market Entry

Zepbound, approved by U.S. regulators in early November, generated an impressive $175.8 million in sales in the fourth quarter. This robust start positions Zepbound potentially to exceed a billion dollars in first-year sales and to become a top-selling drug globally.

Mounjaro’s Sales Surge

Eli Lilly’s revenue was further bolstered by Mounjaro, its blockbuster diabetes drug. Mounjaro’s sales soared to $2.21 billion for the quarter, a dramatic increase from $279.2 million in the previous year. This surge in sales reflects not only growing demand but also higher pricing strategies, as Eli Lilly reduced its savings card program usage.

Market Response and Company Valuation

Following these results, Eli Lilly’s shares saw a 5% jump in premarket trading. The company’s market capitalization stands at approximately $673 billion, establishing it as the largest U.S.-based pharmaceutical firm. Last year, Eli Lilly’s shares climbed nearly 60%, driven largely by the rising popularity of weight loss drugs despite their high costs and mixed insurance coverage.

Investor Focus on Supply and FDA Decisions

Eli Lilly is set to hold an earnings call with investors, where discussions are expected to center around resolving supply issues for its weight loss and diabetes drugs. Additionally, investors are keenly awaiting updates on the FDA’s decision regarding donanemab, Eli Lilly’s experimental Alzheimer’s drug, which has shown promise in slowing the disease’s progression.

Short-Term Market Forecast

The market outlook for Eli Lilly appears bullish in the short term. The successful launch of Zepbound and the substantial revenue from Mounjaro suggest robust demand and effective pricing strategies. However, the company’s ability to address supply constraints and the FDA’s decision on donanemab will be critical in maintaining this positive momentum.