- Shares makes new high on strong Q4
- Debut of obesity drug Zepbound
- 2024 to be slightly ahead of analysts' forecasts
Shares in healthcare giant Eli Lilly (LLY:NYSE) scaled fresh heights in US trading after the diabetes and weight loss specialist reported fourth quarter sales and earnings above analysts’ estimates.
The shares briefly touched $740 before retreating to close at $705 which is more than double where they traded a year ago. Over the last five years the shares have surged 489% taking the market value of the company to $669 billion, overtaking the value of Tesla (TSLA:NASDAQ) and making it the 10th largest S&P 500 constituent.
STRONG ZEPBOUND DEBUT
Investor excitement has centred on the potential growth for the firm’s obesity treatment Zepbound which launched in early December and raked in $175.8 million in sales in the final few weeks of the year.
Some forecasters expect the drug to generate more than a billion dollars in its first full year and to become the biggest selling drug of all-time.
In clinical trials the treatment led to greater weight loss than market leader Wegovy which is made by Danish diabetes specialist Novo Nordisk (NVO:NYSE).
The strong debut of Zepbound and continued success of the company’s diabetes treatment Mounjaro helped the company report a 28% increase in fourth quarter sales to $9.35 billion, beating consensus estimates.
Mounjaro generated revenue of $2.21 billion compared with just $279 million in the same period of 2022.
Adjusted EPS (earnings per share) jumped 19% to $2.49 which was 12% above analysts’ forecasts.
Eli Lilly’s chair and CEO David Ricks commented: ‘2023 was a year of tremendous achievement for Lilly, which delivered life-changing medicines to more patients than ever before resulting in strong revenue growth.
‘Entering 2024, we remain focused on the opportunity in front of us, to help solve some of the most challenging healthcare problems in the world and make life better for millions of patients.’
DEMAND OUTSTRIPPING SUPPLY
The company said it anticipates 2024 sales in the range of $40.1 billion to $41.6 billion and adjusted EPS between $12.2 and $12.7, slightly ahead of consensus estimates.
Chief financial officer Anat Ashkenazi said she expects revenue to accelerate in the second half as new production capacity of Zepbound and Mounjaro comes on stream.
Despite efforts to more than double capacity Ashlenazi said she expects demand to outstrip supply in 2024. A new facility in Concord, North Carolina is expected to start production at the end of the year.
