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Hardly a week seems to go by without something positive emerging from either Eli Lilly and Company (LLY) or its other major competitor, Novo Nordisk (NVO), on the prospects of the GLP-1 weight loss drugs. The ongoing week has again held true to this emerging bullish regimen, with Eli Lilly garnering significant positive developments in the battle to counter Metabolic dysfunction-Associated Steatohepatitis (MASH, previously known as Nonalcoholic Ateatohepatitis or NASH).
For the benefit of those who might not be aware, MASH is a fatty liver disease that develops most often due to metabolic disorders, including obesity and diabetes. This accumulation of fat can sometimes become toxic to the liver cells, resulting in a condition known as fibrosis, where fibrous or scarred liver tissue replaces those damaged by MASH, eventually leading to the loss of liver function.
Glucagon-Like Peptide-1 (GLP-1) hormone suppresses hunger in a variety of ways, including by stimulating the release of insulin in the pancreas, blocking the unhelpful release of glucagon after meals to prevent excess glucose from entering the bloodstream, and slowing gastric emptying to reduce the overall intake of food.
Eli Lilly and Company offers Tirzepatide as one of its proprietary drugs to combat diabetes and obesity, leveraging a GLP-1 agonist as well as a Glucose-dependent Insulinotropic Polypeptide (GIP) one to supposedly provide superior results. Eli Lilly markets Tirzepatide under the Mounjaro and Zepbound labels, with the former geared toward diabetes and the latter billed as a treatment for obesity.
This brings us to the crux of the matter. The results of Tirzepatide’s SYNERGY-NASH phase 2 trial have now been published. As per the trial’s findings, all doses of Tirzepatide managed to reverse MASH in a “clinically meaningful” manner without worsening fibrosis, with the 15mg dose of Tirzepatide exhibiting the greatest efficacy in combating this disease.
Nonetheless, the drug’s amelioratory impact on fibrosis itself failed to achieve statistical significance vis-a-vis the placebo.
Of course, as we’ve noted in a number of our previous posts on this topic, GLP-1 drugs are currently the darling of Wall Street, with analysts continuing to pen increasingly rosy projections for these drugs.
$LLY RESULTS: Q4
❖ Gross margin 80.9% vs. 78.8% y/y, EST 80.1%
❖ ADJ EPS $2.49 vs. $2.09 y/y
❖ Revenue $9.35B, +28% y/y, EST $8.96B
❖ Trulicity revenue $1.67B, -14% y/y, EST $1.74B
❖ Mounjaro revenue $2.21B, EST $1.75B
❖ Humalog revenue $366.6M, -33% y/y, EST $448.4M
❖…— *Walter Bloomberg (@DeItaone) February 6, 2024
Today, we got another evidence that the hype surrounding GLP-1 drugs is translating into real-world sales. While announcing its earnings for the fourth quarter of 2023, Eli Lilly and Company has disclosed that it managed to comfortably beat consensus revenue expectations of $8.95 billion for the quarter by reporting actual revenue of $9.35 billion.
$LLY イーライ・リリー
Mounjaro！マンジャロ！ pic.twitter.com/pPgcR8UqM8— のぶ🇺🇸米国株投資 (@nobustocks) February 6, 2024
A significant proportion of this beat was a result of the phenomenal growth in the demand for Eli Lilly and Company’s Mounjaro offering, whose quarterly sales increased to $2.21 billion vs. the $1.75 billion consensus estimate. The drug maker now expects to earn between $40.4 billion and $41.6 billion in full-year revenue.