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Eli Lilly (LLY) Q2 Earnings Top, Mounjaro, Zepbound Drive View
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Eli Lilly and Company (LLY - Free Report) reported second-quarter 2024 adjusted earnings per share (“EPS”) of $3.92, which comprehensively beat the Zacks Consensus Estimate of $2.64 per share. Earnings rose 86% year over year.
Revenues of $11.3 billion rose 36% year over year. Total revenues beat the Zacks Consensus Estimate of $9.83 billion.
Higher volumes of drugs like Mounjaro, Zepbound, Verzenio and Taltz made up for a difficult comparison with the year-ago quarter, which included revenues from the sale of Baqsimi rights. Excluding $579.0 million of revenues from the sale of rights for Baqsimi in the year-ago quarter, second-quarter 2024 revenues increased 46% while volumes rose 37%. Worldwide sales of its non-incretin products rose 17% in the quarter, excluding Baqsimi sales.
Quarter in Detail
Key growth products (select products launched prior to 2022 like Cyramza, Emgality, Jardiance, Olumiant, Retevmo, Taltz, Trulicity, Tyvyt and Verzenio) grew 3% to $5.05 billion. Eli Lilly’s new products (products launched since 2022 like Ebglyss, Jaypirca, Mounjaro, Omvoh and Zepbound) contributed $4.46 billion to revenues, led by Mounjaro and Zepbound.
In the reported quarter, net realized prices rose 10%, while volumes rose 27%.
While U.S. revenues rose 42% to $7.84 billion, ex-U.S. revenues increased 25% to $3.47 billion.
Among the newer drugs, Lilly’s most popular products are its tirzepatide medicines, diabetes drug Mounjaro and weight loss medicine, Zepbound.
Mounjaro recorded sales of $3.09 billion during the quarter, higher than $1.81 billion in the previous quarter. The reported sales figure significantly beat the Zacks Consensus Estimate of $2.34 billion, as well as our model estimate of $2.46 billion.
Mounjaro sales benefited from increased demand, improved channel dynamics and higher realized prices due to decreased utilization of savings card programs. International sales benefited from the launch of Mounjaro KwikPen in various markets.
Zepbound, which was launched in November 2023, recorded sales of $1.24 billion in the quarter compared with $517.4 million in the previous quarter. Zepbound revenues handsomely beat our model estimate of $700 million.
Both Mounjaro and Zepbound include the same compound tirzepatide, a dual GIP and GLP-1 receptor agonist (GIP/GLP-1 RA). The GLP-1 segment is an important class of drugs for multiple cardiometabolic diseases and is gaining significant popularity.
Lilly’s tirzepatide medicines face strong competition from Novo Nordisk’s (NVO - Free Report) semaglutide. Semaglutide is approved as Ozempic pre-filled pen and Rybelsus oral tablet for type II diabetes and as Wegovy injection for weight management. Novo Nordisk’s GLP-1 diabetes sales increased 32% at constant exchange rate (CER) in the second quarter. Sales of Ozempic rose 30%, while Wegovy rose 53% at CER. Sales of both Ozempic and Wegovy missed investor expectations. Like Lilly, Novo Nordisk is also facing supply constraints for its GLP-1 products that are likely to continue. Novo Nordisk also cut its operating profit guidance.
New drug Jaypirca recorded $92.4 million in sales compared with $50.0 million in the previous quarter. New drugs Omvoh and Ebglyss recorded sales of $25.6 million and $4.3 million, respectively, in the quarter.
Among the growth products, Trulicity generated revenues worth $1.25 billion, down 31% year over year. Sales declined 36% in the United States due to lower volumes amid supply constraints and increased competition. In international markets, sales declined 16% due to decreased volumes. Volumes in international markets continued to be affected by the company’s measures to manage strong demand amid tight supply. Sales of Trulicity were in line with the Zacks Consensus Estimate but missed our model estimate of $1.29 billion.
Jardiance sales rose 15% to $769.6 million, driven by increased demand trends. Jardiance missed the Zacks Consensus Estimate of $792.0 million as well as our model estimate of $818.8 million.
Taltz brought in sales of $824.7 million, up 17% year over year, driven by increased demand in the United States and outside. Taltz beat the Zacks Consensus Estimate of $758.0 million and our model estimate of $764.0 million.
Verzenio generated sales of $1.33 billion in the reported quarter, up 44% year over year, on increased demand. Verzenio sales beat the Zacks Consensus Estimate of $1.24 billion as well as our model estimate of $1.28 billion.
Emgality generated revenues of $192.0 million in the quarter, up 13% year over year. Olumiant (baricitinib) generated sales of $227.7 million, up 4% on a year-over-year basis.
2024 Guidance Upped
The company raised its previously issued sales and earnings guidance for 2024. Lilly raised its revenue guidance range to $45.4 billion to $46.6 billion from the prior expectation of $42.4 billion to $43.6 billion. The earnings per share guidance was raised from a range of $13.50 to $14.00 to $16.10 to $16.60.
Our Take
Lilly’s second-quarter results were exceptionally strong as it beat estimates for earnings and sales. Almost all key drugs, Mounjaro, Zepbound, Taltz and Verzenio beat expectations. Mounjaro and Zepbound together recorded more than $4 billion in sales.
Lilly faces continued supply constraints for incretin-based products like Trulicity, Mounjaro and Zepbound. Demand for tirzepatide drugs, Mounjaro and Zepbound, is extremely strong and exceeds supply. Lilly is investing in new advanced manufacturing plants and lines in the United States and Europe to increase supply. With the increase in production volumes, channel dynamics and stocking levels in the United States improved, which boosted sales growth in the quarter. While Lilly said that supply and demand are more balanced now, the supply issues might continue for some doses if demand exceeds supply.
Strong demand for Mounjaro and Zepbound, as well as non-incretin products, pushed Lilly to raise its sales and earnings guidance ranges for 2024. Lilly also has better visibility on its production plans for Mounjaro and Zepbound for the year and planned launches of Mounjaro in international markets.
Shares skyrocketed 13% in pre-market trading in response to the stupendous results and guidance increase supported by a positive outlook.
Lilly’s stock has risen 32.5% so far this year compared with an increase of 14.7% for the industry.
Image Source: Zacks Investment Research
Last month, Lilly won a long-awaited FDA approval for donanemab, to be sold under the brand name Kisunla, for treating early symptomatic Alzheimer's disease. Lilly believes Kisunla can generate blockbuster sales. Kisunla is the second drug on the market to treat Alzheimer's disease.
Biogen (BIIB - Free Report) and its Japan-based partner Eisai’s Leqembi was approved last year in the United States to reduce the cognitive decline associated with early Alzheimer’s disease. Leqembi is also available in Japan and China. Though the Leqembi launch was slow, sales picked up in the first half.
Last month, Lilly announced a definitive agreement to acquire Waltham, MA-based small biotech Morphic Therapeutics (MORF - Free Report) for approximately $3.2 billion. The acquisition will expand Lilly’s pipeline in immunology, a core area for the company, by adding Morphic’s oral integrin therapies for treating serious chronic diseases. Morphic's lead pipeline candidate is MORF-057, an oral α4β7 inhibitor with the potential to improve outcomes in treating inflammatory bowel disease.
Image: Bigstock
Eli Lilly (LLY) Q2 Earnings Top, Mounjaro, Zepbound Drive View
Eli Lilly and Company (LLY - Free Report) reported second-quarter 2024 adjusted earnings per share (“EPS”) of $3.92, which comprehensively beat the Zacks Consensus Estimate of $2.64 per share. Earnings rose 86% year over year.
Revenues of $11.3 billion rose 36% year over year. Total revenues beat the Zacks Consensus Estimate of $9.83 billion.
Higher volumes of drugs like Mounjaro, Zepbound, Verzenio and Taltz made up for a difficult comparison with the year-ago quarter, which included revenues from the sale of Baqsimi rights. Excluding $579.0 million of revenues from the sale of rights for Baqsimi in the year-ago quarter, second-quarter 2024 revenues increased 46% while volumes rose 37%. Worldwide sales of its non-incretin products rose 17% in the quarter, excluding Baqsimi sales.
Quarter in Detail
Key growth products (select products launched prior to 2022 like Cyramza, Emgality, Jardiance, Olumiant, Retevmo, Taltz, Trulicity, Tyvyt and Verzenio) grew 3% to $5.05 billion. Eli Lilly’s new products (products launched since 2022 like Ebglyss, Jaypirca, Mounjaro, Omvoh and Zepbound) contributed $4.46 billion to revenues, led by Mounjaro and Zepbound.
In the reported quarter, net realized prices rose 10%, while volumes rose 27%.
While U.S. revenues rose 42% to $7.84 billion, ex-U.S. revenues increased 25% to $3.47 billion.
Among the newer drugs, Lilly’s most popular products are its tirzepatide medicines, diabetes drug Mounjaro and weight loss medicine, Zepbound.
Mounjaro recorded sales of $3.09 billion during the quarter, higher than $1.81 billion in the previous quarter. The reported sales figure significantly beat the Zacks Consensus Estimate of $2.34 billion, as well as our model estimate of $2.46 billion.
Mounjaro sales benefited from increased demand, improved channel dynamics and higher realized prices due to decreased utilization of savings card programs. International sales benefited from the launch of Mounjaro KwikPen in various markets.
Zepbound, which was launched in November 2023, recorded sales of $1.24 billion in the quarter compared with $517.4 million in the previous quarter. Zepbound revenues handsomely beat our model estimate of $700 million.
Both Mounjaro and Zepbound include the same compound tirzepatide, a dual GIP and GLP-1 receptor agonist (GIP/GLP-1 RA). The GLP-1 segment is an important class of drugs for multiple cardiometabolic diseases and is gaining significant popularity.
Lilly’s tirzepatide medicines face strong competition from Novo Nordisk’s (NVO - Free Report) semaglutide. Semaglutide is approved as Ozempic pre-filled pen and Rybelsus oral tablet for type II diabetes and as Wegovy injection for weight management. Novo Nordisk’s GLP-1 diabetes sales increased 32% at constant exchange rate (CER) in the second quarter. Sales of Ozempic rose 30%, while Wegovy rose 53% at CER. Sales of both Ozempic and Wegovy missed investor expectations. Like Lilly, Novo Nordisk is also facing supply constraints for its GLP-1 products that are likely to continue. Novo Nordisk also cut its operating profit guidance.
New drug Jaypirca recorded $92.4 million in sales compared with $50.0 million in the previous quarter. New drugs Omvoh and Ebglyss recorded sales of $25.6 million and $4.3 million, respectively, in the quarter.
Among the growth products, Trulicity generated revenues worth $1.25 billion, down 31% year over year. Sales declined 36% in the United States due to lower volumes amid supply constraints and increased competition. In international markets, sales declined 16% due to decreased volumes. Volumes in international markets continued to be affected by the company’s measures to manage strong demand amid tight supply. Sales of Trulicity were in line with the Zacks Consensus Estimate but missed our model estimate of $1.29 billion.
Jardiance sales rose 15% to $769.6 million, driven by increased demand trends. Jardiance missed the Zacks Consensus Estimate of $792.0 million as well as our model estimate of $818.8 million.
Taltz brought in sales of $824.7 million, up 17% year over year, driven by increased demand in the United States and outside. Taltz beat the Zacks Consensus Estimate of $758.0 million and our model estimate of $764.0 million.
Verzenio generated sales of $1.33 billion in the reported quarter, up 44% year over year, on increased demand. Verzenio sales beat the Zacks Consensus Estimate of $1.24 billion as well as our model estimate of $1.28 billion.
Emgality generated revenues of $192.0 million in the quarter, up 13% year over year. Olumiant (baricitinib) generated sales of $227.7 million, up 4% on a year-over-year basis.
2024 Guidance Upped
The company raised its previously issued sales and earnings guidance for 2024. Lilly raised its revenue guidance range to $45.4 billion to $46.6 billion from the prior expectation of $42.4 billion to $43.6 billion. The earnings per share guidance was raised from a range of $13.50 to $14.00 to $16.10 to $16.60.
Our Take
Lilly’s second-quarter results were exceptionally strong as it beat estimates for earnings and sales. Almost all key drugs, Mounjaro, Zepbound, Taltz and Verzenio beat expectations. Mounjaro and Zepbound together recorded more than $4 billion in sales.
Lilly faces continued supply constraints for incretin-based products like Trulicity, Mounjaro and Zepbound. Demand for tirzepatide drugs, Mounjaro and Zepbound, is extremely strong and exceeds supply. Lilly is investing in new advanced manufacturing plants and lines in the United States and Europe to increase supply. With the increase in production volumes, channel dynamics and stocking levels in the United States improved, which boosted sales growth in the quarter. While Lilly said that supply and demand are more balanced now, the supply issues might continue for some doses if demand exceeds supply.
Strong demand for Mounjaro and Zepbound, as well as non-incretin products, pushed Lilly to raise its sales and earnings guidance ranges for 2024. Lilly also has better visibility on its production plans for Mounjaro and Zepbound for the year and planned launches of Mounjaro in international markets.
Shares skyrocketed 13% in pre-market trading in response to the stupendous results and guidance increase supported by a positive outlook.
Lilly’s stock has risen 32.5% so far this year compared with an increase of 14.7% for the industry.
Image Source: Zacks Investment Research
Last month, Lilly won a long-awaited FDA approval for donanemab, to be sold under the brand name Kisunla, for treating early symptomatic Alzheimer's disease. Lilly believes Kisunla can generate blockbuster sales. Kisunla is the second drug on the market to treat Alzheimer's disease.
Biogen (BIIB - Free Report) and its Japan-based partner Eisai’s Leqembi was approved last year in the United States to reduce the cognitive decline associated with early Alzheimer’s disease. Leqembi is also available in Japan and China. Though the Leqembi launch was slow, sales picked up in the first half.
Last month, Lilly announced a definitive agreement to acquire Waltham, MA-based small biotech Morphic Therapeutics (MORF - Free Report) for approximately $3.2 billion. The acquisition will expand Lilly’s pipeline in immunology, a core area for the company, by adding Morphic’s oral integrin therapies for treating serious chronic diseases. Morphic's lead pipeline candidate is MORF-057, an oral α4β7 inhibitor with the potential to improve outcomes in treating inflammatory bowel disease.
Zacks Rank
Eli Lilly currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Eli Lilly and Company Price and Consensus
Eli Lilly and Company price-consensus-chart | Eli Lilly and Company Quote