An injection pen of Zepbound, Eli Lilly’s weight reduction drug, is displayed in Latest York City, U.S., December 11, 2023.
Brendan McDermid | Reuters
Eli Lilly on Tuesday reported fourth-quarter revenue and adjusted earnings that topped expectations on the strong launch of its latest weight reduction drug, Zepbound, and better prices for its blockbuster diabetes treatment, Mounjaro.
Zepbound, which won approval from U.S. regulators in early November, raked in $175.8 million in sales for the fourth quarter.
The quarterly results are the primary to incorporate sales of Zepbound, which some analysts say could post greater than a billion dollars in sales in its first 12 months in the marketplace and eventually, turn into the largest drug of all time.
Shares of Eli Lilly fell greater than 1% on Tuesday following the outcomes. The stock jumped almost 60% last 12 months as weight reduction drugs skyrocketed in popularity despite hefty price tags, mixed insurance coverage, a handful of unpleasant unwanted effects and provide shortages. With a market cap of roughly $673 billion, Eli Lilly is the most important pharmaceutical company based within the U.S.
Here’s what Eli Lilly reported for the fourth quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly often called Refinitiv:
- Earnings per share: $2.49 adjusted vs. $2.22 expected
- Revenue: $9.35 billion vs. $8.93 billion expected
Eli Lilly posted net income of $2.19 billion, or $2.42 a share, for the fourth quarter. That compares with a profit of $1.94 billion, or $2.14 a share, a 12 months earlier.
Excluding one-time items related to the worth of intangible assets, amongst other adjustments, the corporate posted a per-share profit of $2.49 for the fourth quarter of 2023.
The pharmaceutical giant booked fourth-quarter revenue of $9.35 billion, up 28% from the identical period a 12 months ago.
Eli Lilly also issued its full-year forecast for 2024, which was generally according to expectations.
The corporate expects full-year adjusted earnings of $12.20 to $12.70 per share. Eli Lilly also forecast 2024 revenue of $40.4 billion to $41.6 billion.
Analysts surveyed by LSEG expected full-year adjusted earnings of $12.43 per share and sales of $39.38 billion.
Eli Lilly expects revenue growth to speed up within the second half of the 12 months, which shall be consistent with the increased availability of incretin drug doses, the corporate’s chief financial officer, Anat Ashkenazi, said during an earnings call Tuesday. Incretin drugs are treatments similar to Mounjaro and Zepbound that mimic hormones produced within the gut to suppress appetite and regulate blood sugar.
Mounjaro sees higher demand, prices
Eli Lilly expects demand for its incretin drugs to outpace supply in 2024, in response to Ashkenazi.
But Ashkenazi said the corporate achieved its goal of doubling capability for producing incretin drugs by the top of 2023. She added that Eli Lilly’s capability expansion efforts will proceed with “equal urgency,” with probably the most significant production increases occurring within the second half of the 12 months.
By that time within the 12 months, Ashkenazi said the corporate expects its production of sellable doses of incretin drugs to be not less than 1.5 times the production of those doses within the second half of last 12 months.
Amongst the corporate’s efforts to expand production is a latest manufacturing site in Concord, North Carolina. Ashkenazi said that the plant will initiate production of incretin drugs as early as the top of 2024, with products available to ship in 2025.
Higher prices for older drugs, particularly Mounjaro, helped drive up Eli Lilly’s revenue, the corporate said. Mounjaro booked $2.21 billion in sales for the fourth quarter, up from just $279.2 million in the identical period a 12 months ago.
Analysts had expected the drug to usher in $1.73 billion in worldwide sales, in response to estimates compiled by FactSet.
That increase reflects heightened demand but in addition “higher realized prices” within the U.S. as a result of decreased use of Eli Lilly’s savings card programs as access to the drug continued to expand through the quarter, the corporate said. The savings card programs aim to assist lower the out-of-pocket costs for drugs like Mounjaro for patients.
Eli Lilly expects a high single-digit percentage price decline in 2024 for its core business of medicine, with a more significant decrease expected within the second half of the 12 months.
Results from across the portfolio
Revenue growth was also driven by sales of Eli Lilly’s breast cancer pill Verzenio, which rose 42% to $1.15 billion for the quarter as a result of increased demand and better prices.
That result got here in under analysts’ expectations, nonetheless, which called for $1.18 billion in sales for the period.
Sales of Jardiance, a tablet that lowers blood sugar in Type 2 diabetes patients, climbed 30% to $798.1 million for the fourth quarter. Analysts had expected $771.8 million in sales from Jardiance.
Jardiance, which Eli Lilly shares with Boehringer Ingelheim, is among the many first 10 drugs chosen to face price negotiations with the federal Medicare program. Those price talks heated up last week after Medicare sent its initial price offers for every drug to the manufacturers.
More CNBC health coverage
Meanwhile, Eli Lilly said higher prices were offset by lower prices of its other diabetes medicine Trulicity and insulin product Humalog.
Trulicity reported $1.67 billion in revenue, down 14% from the identical period a 12 months ago. Analysts had expected Trulicity to get $1.77 billion in sales for the quarter.
Humalog saw $366.6 million in revenue for the quarter, down 33% from the year-ago period. Analysts had expected the drugs to book $438 million in sales, in response to FactSet.
That decrease is no surprise: Last 12 months, Eli Lilly said it might cut prices of Humalog and one other commonly prescribed insulin by 70% and cap monthly out-of-pocket costs at $35 at certain retail pharmacies for individuals who have private insurance starting May 1, 2023.
During an earnings call, Eli Lilly reiterated that it expects an FDA’s decision on Eli Lilly’s experimental Alzheimer’s drug, donanemab, in the primary quarter of the 12 months. That treatment significantly slowed the progression of the memory-robbing disease in patients on the early stages of it.
Don’t miss these stories from CNBC PRO:
