Lilly sales surge on obesity, diabetes drug demand

Sales of Eli Lilly’s diabetes drug Mounjaro exceeded $5 billion in 2023, its first full year on the market, the company said Tuesday, in the latest sign of surging demand for the therapy and other medicines of its kind.

Mounjaro’s fast launch helped drive Lilly’s revenue last year to $34 billion, a 20% increase over 2023. Fourth quarter revenue of $9.4 billion eclipsed analysts’ consensus expectations by 5%, Leerink Partners’ David Risinger wrote in a note to clients.

Lilly said Mounjaro now accounts for 27% of total prescriptions in the U.S. for injectable “incretins,” the fast-selling group of drugs that work by modulating hormones that control insulin production. Sales of an older drug in this class, Lilly’s Trulicity, fell 4% in 2023 to $7 billion, but still led Lilly’s business.

The obesity drug Zepbound, which contains the same active ingredient as Mounjaro, launched in the fourth quarter and brought in sales of $176 million through Dec. 31.

Zepbound competes with Novo Nordisk’s rival weight loss shot Wegovy, which has been shown to reduce the risk of heart problems and could therefore have an edge with insurers. Lilly reported that one-third of people with commercial insurance have access to Zepbound through their health plans, however.

Executives expect Lilly’s revenue growth to continue into 2024, forecasting sales of between $40.4 billion and $41.6 billion. But that partly depends on how far Trulicity sales fall as patients shift to newer medicines, and whether Lilly can overcome the supply constraints weighing down incretin drugs.

“The company continues to execute on its manufacturing expansion agenda. However, given strong demand and the time required to bring manufacturing capacity fully online, the company expects that demand for incretins is likely to outpace supply in 2024,” Lilly said in a statement.

Novo has also had trouble keeping up with the demand for its medicines. The company limited access to starting doses of Wegovy for months to ensure people who were already being treated could stay on therapy. Earlier this week, it announced plans to spend $11 billion on three Catalent production sites to help bolster supply.

Demand could climb higher, still, if incretins can prove helpful for a common liver disease known as metabolic dysfunction-associated steatohepatitis, or MASH. Lilly on Tuesday disclosed encouraging signs that they might, as Mounjaro helped resolve symptoms of NASH in 74% of patients who received a high dose in a Phase 2 trial, versus only 13% of participants on placebo.

That finding is “the best any MASH drug has ever shown in Phase 2 or Phase 3,” wrote Raymond James analyst Steven Seedhouse, in a note to clients. Detailed data will be important, however, as Lilly’s disclosure wasn’t clear on how well treatment helped to resolve fibrosis.

Shares of other companies with MASH drugs in development, among them Madrigal Pharmaceuticals and Akero Therapeutics, fell after Lilly’s announcement.

Lilly could get another revenue boost elsewhere. The Food and Drug Administration is set to decide on approval of its Alzheimer’s disease treatment donanemab within weeks.

That drug will take on Eisai and Biogen’s Leqembi, which has had a slow start on the U.S. market. Eisai and Biogen hope to treat 10,000 people in the U.S. before April, though some analysts are now skeptical they can reach that goal.

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