Eli Lilly on Thursday reported second-quarter earnings and revenue that beat expectations and raised its full-year revenue outlook by $3 billion as sales of its popular diabetes drug Mounjaro and weight-loss injection Zepbound soared.
Eli Lilly shares jumped more than 11% in premarket trading Thursday.
The drugmaker now expects revenue for the year to be between $45.4 billion and $46.6 billion, up $3 billion at either end of the range.
The company also raised its full-year adjusted earnings to a range of $16.10 to $16.60, up from its previous guidance of $13.50 to $14 per share.
Eli Lilly said the guidance increase was driven primarily by strong performance from Mounjaro and Zipbond and comes in part from “improved clarity” on the company’s production expansions and planned launches of Mounjaro outside the U.S. The company said it achieved several supply milestones during the quarter, without providing specifics.
Demand has far outstripped supply for incretin drugs like Zebound and Mujaro, which mimic hormones produced in the gut to suppress a person’s appetite and regulate blood sugar. That’s forced Eli Lilly and rival Novo Nordisk to invest heavily to boost manufacturing.
But Eli Lilly’s supply problems may be starting to ease. On Friday, the Food and Drug Administration’s drug database announced that all doses of Zebound and Mounjaro are available in the United States after a long-running shortage.
However, the company warned that expected increases in demand could lead to “tight supply” for a period of time for certain doses of incretin drugs.
“We’re seeing incredible demand, and we’re not even trying hard to promote this drug,” Eli Lilly CEO David Ricks told CNBC in an interview. “What you’re seeing is just organic demand from consumers here as we’ve shipped more product, as we’ve worked to get more supply online in the United States.”
Rex said the company has built six manufacturing plants, some of which have already begun ramping up production, and has hired thousands of workers to increase production. He noted that the company expects incretin production in the second half of 2024 to be 50% higher than it was during the same period last year.
“We’re on track to 2025,” Rex said, adding that Eli Lilly is still working on developing a more convenient weight-loss pill, which could help the company meet growing demand.
Here's what Eli Lilly reported for the second quarter compared to what Wall Street was expecting, based on a survey of analysts by the London Stock Exchange Group:
Earnings per share: $3.92 adjusted vs. $2.60 expectedRevenue: $11.30 billion vs. $9.92 billion expected
The drug giant reported net income of $2.97 billion, or $3.28 a share, in the second quarter. That compared with earnings of $1.76 billion, or $1.95 a share, a year earlier.
Excluding non-recurring items related to the value of intangible assets and other adjustments, Eli Lilly reported earnings of $3.92 per share in the second quarter of 2024.
The company reported second-quarter revenue of $11.30 billion, up 36% year-over-year.
Eli Lilly said sales were largely driven by increased demand for Mounjaro and Zepbound products as production increased and supply improved in the United States.
This is Zebound’s second full quarter in the U.S. market after receiving regulatory approval in November. The company posted weekly sales of $1.24 billion during the period, well above the $922.2 million analysts had expected, according to StreetAccount.
Meanwhile, Mojaro generated $3.09 billion in revenue in the second quarter, more than triple the sales it generated in the year-earlier period. Analysts had expected sales of $2.39 billion, according to StreetAccount.
Mounjaro prices rose in the U.S. during the second quarter, partly due to increased access to the drug and lower use of savings card programs compared to the previous period of the year.
But the company said the savings cards should have a “minimal impact” on price comparisons achieved in the second half of the year because a $25-a-month voucher for patients without insurance coverage for Mounjaro expired in June.
Pricing for Eli Lilly's incretin drugs was “pretty stable” during the second quarter, Rex said.
That contrasts with Novo Nordisk, which on Wednesday reported weaker-than-expected second-quarter sales of its weight-loss drug Wegovy and diabetes injection Ozempic, partly due to pricing pressures.
Wegovy's revenue was hurt by higher-than-expected price concessions to pharmacy benefit managers in the United States, who negotiate drug discounts with manufacturers on behalf of insurers, Novo Nordisk executives said on an earnings call Wednesday.
Eli Lilly shares have surged more than 30% this year after jumping about 60% in 2023 on surging demand for the company’s weight-loss and diabetes drugs — and growing investor interest in their potential as treatments for other health conditions. That popularity comes despite steep monthly prices, inconsistent insurance coverage and intermittent supply shortages.
With a market cap of over $730 billion, Eli Lilly is the largest U.S.-based pharmaceutical company.
