Eli Lilly hit $1-trillion (about R17.4-trillion) in market value on Friday, making it the first drugmaker to enter the exclusive club dominated by tech giants and underscoring its rise as a weight-loss powerhouse.
A more than 35% rally in the company’s stock this year has largely been driven by the explosive growth of the weight-loss drug market.
Once seen as a niche category, obesity treatments are now one of the most lucrative segments in health care, with steadily rising demand.
Novo Nordisk had the early lead in the space, but Lilly’s drugs — Mounjaro and Zepbound — have surged in popularity and helped eclipse its rival in prescriptions.
In the latest reported quarter, Lilly reported combined revenue of more than $10bn from its obesity and diabetes portfolio, accounting for more than half of its total revenue of $17.6bn.
“They are doing so many things outside of obesity, but to suggest anything is driving share price beyond obesity at this point, I don’t know if that would be a factual statement,” said Kevin Gade, COO at Lilly shareholder Bahl and Gaynor, ahead of the milestone.
Wall Street estimates the weight-loss drug market to be worth $150bn by 2030, with Lilly and Novo together controlling the majority of projected global sales.
Investors are now focused on Lilly’s oral obesity drug, Orforglipron, which is expected to be approved early next year.
In a note last week, Citi analysts said the latest generation of GLP-1 drugs have already been a “sales phenomenon”, and Orforglipron is poised to benefit from the “inroads made by its injectable predecessors”.
Reuters
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