Eli Lilly lifts sales view by $2 billion on soaring weight-loss drug demand
Eli Lilly lifts sales view by $2 billion on soaring weight-loss drug demand
April 30 (Reuters) – Eli Lilly (LLY.N) raised its annual revenue forecast by $2 billion on Tuesday due to strong demand and a steady ramp up of production of its weight-loss treatment Zepbound and related diabetes drug Mounjaro, lifting its shares about 7%.
Lilly said it expects the drugs to remain in tight supply, but plans for significant production increases in the second half of the year. Sales growth for the weight-loss and diabetes treatments will primarily depend on how much it can produce and ship in the short- to mid-term, the company said.
“Our top priority is making more product and we’re doing everything we can to do that”, CEO David Ricks told CNBC.
Skyrocketing demand for Mounjaro and Zepbound, both chemically known as tirzepatide, has propelled the Indianapolis-based drugmaker’s market value above $700 billion – surpassing both Tesla (TSLA.O) and Walmart (WMT.N).
“We expect this increased clarity on production capacity and guidance raise will be well received by the Street,” JP Morgan analyst Chris Schott said.
However, supply for the drugs remains constrained. Most doses of Mounjaro and Zepbound are expected to be available in limited amounts through the second quarter, according to the U.S. Food and Drug Administration’s website.
Ricks said the production of these drugs was a capital intensive, technically complex and highly regulated process.
“We’re pulling out all stops to produce more, but the lag time is significant.”