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Lilly (LLY) Up 3% on Obesity Drug Cutting Diabetes Risk
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Shares of Eli Lilly (LLY - Free Report) rose more than 3% on Tuesday after reporting long-term data from the late-stage SURMOUNT-1 study. Data from this study showed that treatment with tirzepatide over three years lowered the risk of developing type 2 diabetes (T2D) by 94% compared with placebo, in obese or overweight adults with pre-diabetes.
A dual GIP and GLP-1 receptor agonist, tirzepatide is the active ingredient used in the company’s two blockbuster medications — obesity drug Zepbound and diabetes drug Mounjaro.
The SURMOUNT-1 study evaluated three doses of the drug — 5mg, 10mg and 15mg. Data from the study also showed that treatment with tirzepatide achieved significant average weight reductions of 15.4% at the 5mg dose, 19.9% at the 10 mg dose and 22.9% at the 15 mg dose compared with 2.1% for placebo at the end of the 176-week treatment period.
However, the benefits of the drug appear to last in patients as long as they continue the medication. The 176-week treatment period was also followed by a 17-week off-treatment period. During that time, participants who discontinued tirzepatide began to regain weight while progression to Type 2 diabetes increased slightly. Including these 17 weeks, patients who took Zepbound had an 88% reduction in the risk of progression to T2D compared with the placebo.
We remind investors that the SURMOUNT-1 study supported the FDA approval for Zepbound in obesity last November. At that time, the approval was supported by data over a 72-week treatment period. The safety results of the 176-week treatment period were also consistent with the 72-week treatment period.
Following the results announcement, shares of Lilly touched an all-time high price of $967 on Aug 20. Wall Street has been paying a lot of attention to the stock thanks to the impressive sales performance of Mounjaro and Zepbound. The SURMOUNT-1 study results add to the growing list of benefits offered by tirzepatide, which already includes reducing the risk of heart failure and treating sleep apnea.
While the growing number of health benefits associated with tirzepatide could lead to increased sales for Lilly, it could also persuade Medicare to cover the cost of obesity medications. The Centers for Medicare and Medicaid Services (CMS) previously announced that Medicare can start covering obesity drugs as long as they are approved for an added health benefit.
Year to date, Eli Lilly’s shares have surged 63.0% compared with the industry’s 24.7% rise.
Image Source: Zacks Investment Research
The GLP-1 segment is an important class of drugs for multiple cardiometabolic diseases and is gaining significant popularity. GLP-1 drugs work by mimicking the hormone GLP-1, resulting in weight loss, lowering hemoglobin A1c and reducing cardiovascular risks.
The only other large drugmaker to have generated phenomenal returns, also gaining from the GLP-1 segment’s popularity, is Novo Nordisk (NVO - Free Report) . Novo’s stock has skyrocketed 415% in the past five years, mainly on the success of its drug semaglutide, a direct competitor to Lilly’s tirzepatide medicines. Semaglutide is approved as Ozempic pre-filled pen and Rybelsus oral tablet for type II diabetes and as Wegovy injection for weight management. Despite supply challenges, Wegovy is seeing strong prescription trends and is generating impressive revenues and profits for Novo Nordisk.
The obesity market has garnered much interest lately. Lilly and Novo have been seeing exponential sales growth of their obesity drugs, which is boosting revenues and profits. The companies achieved a market cap north of $600 billion. However, these firms have been unable to cope with existing demand and are facing delays in fulfilling orders amid persistent supply constraints and product shortages.
Per research conducted by Goldman Sachs, the obesity market in the United States is expected to reach $130 billion by the end of this decade. This is also evident from the fact that Lilly and Novo are not only investing heavily to optimize their production capacities but have also started evaluating multiple other novel obesity candidates in their pipeline.
Based on the success seen by Lilly and Novo in the obesity space, several other companies like Viking Therapeutics (VKTX - Free Report) , Amgen (AMGN - Free Report) and Rocheare also developing their obesity drugs in clinical studies.
Viking’s VK2735 is being evaluated as a subcutaneous (SC) injection and as an oral pill in a mid-stage study and an early-stage study, respectively. The drug has shown immense potential, having demonstrated superior weight reduction capabilities in both clinical studies. Viking expects to advance both formulations of the drug into further development before 2024-end.
Alongside its first-quarter earnings report, Amgen announced that it has completed an interim analysis of data from a mid-stage study, MariTide. Though AMGN did not discuss any numbers, it was ‘very encouraged’ with the interim data. The top-line data from this study is expected later this year. Based on these interim results, Amgen has already started planning for a broad late-stage program on the drug across multiple indications.
Roche recently forayed into the obesity market after it acquired privately owned Carmot Therapeutics for $2.7 billion in January.
Image: Bigstock
Lilly (LLY) Up 3% on Obesity Drug Cutting Diabetes Risk
Shares of Eli Lilly (LLY - Free Report) rose more than 3% on Tuesday after reporting long-term data from the late-stage SURMOUNT-1 study. Data from this study showed that treatment with tirzepatide over three years lowered the risk of developing type 2 diabetes (T2D) by 94% compared with placebo, in obese or overweight adults with pre-diabetes.
A dual GIP and GLP-1 receptor agonist, tirzepatide is the active ingredient used in the company’s two blockbuster medications — obesity drug Zepbound and diabetes drug Mounjaro.
The SURMOUNT-1 study evaluated three doses of the drug — 5mg, 10mg and 15mg. Data from the study also showed that treatment with tirzepatide achieved significant average weight reductions of 15.4% at the 5mg dose, 19.9% at the 10 mg dose and 22.9% at the 15 mg dose compared with 2.1% for placebo at the end of the 176-week treatment period.
However, the benefits of the drug appear to last in patients as long as they continue the medication. The 176-week treatment period was also followed by a 17-week off-treatment period. During that time, participants who discontinued tirzepatide began to regain weight while progression to Type 2 diabetes increased slightly. Including these 17 weeks, patients who took Zepbound had an 88% reduction in the risk of progression to T2D compared with the placebo.
We remind investors that the SURMOUNT-1 study supported the FDA approval for Zepbound in obesity last November. At that time, the approval was supported by data over a 72-week treatment period. The safety results of the 176-week treatment period were also consistent with the 72-week treatment period.
Following the results announcement, shares of Lilly touched an all-time high price of $967 on Aug 20. Wall Street has been paying a lot of attention to the stock thanks to the impressive sales performance of Mounjaro and Zepbound. The SURMOUNT-1 study results add to the growing list of benefits offered by tirzepatide, which already includes reducing the risk of heart failure and treating sleep apnea.
While the growing number of health benefits associated with tirzepatide could lead to increased sales for Lilly, it could also persuade Medicare to cover the cost of obesity medications. The Centers for Medicare and Medicaid Services (CMS) previously announced that Medicare can start covering obesity drugs as long as they are approved for an added health benefit.
Year to date, Eli Lilly’s shares have surged 63.0% compared with the industry’s 24.7% rise.
Image Source: Zacks Investment Research
The GLP-1 segment is an important class of drugs for multiple cardiometabolic diseases and is gaining significant popularity. GLP-1 drugs work by mimicking the hormone GLP-1, resulting in weight loss, lowering hemoglobin A1c and reducing cardiovascular risks.
The only other large drugmaker to have generated phenomenal returns, also gaining from the GLP-1 segment’s popularity, is Novo Nordisk (NVO - Free Report) . Novo’s stock has skyrocketed 415% in the past five years, mainly on the success of its drug semaglutide, a direct competitor to Lilly’s tirzepatide medicines. Semaglutide is approved as Ozempic pre-filled pen and Rybelsus oral tablet for type II diabetes and as Wegovy injection for weight management. Despite supply challenges, Wegovy is seeing strong prescription trends and is generating impressive revenues and profits for Novo Nordisk.
The obesity market has garnered much interest lately. Lilly and Novo have been seeing exponential sales growth of their obesity drugs, which is boosting revenues and profits. The companies achieved a market cap north of $600 billion. However, these firms have been unable to cope with existing demand and are facing delays in fulfilling orders amid persistent supply constraints and product shortages.
Per research conducted by Goldman Sachs, the obesity market in the United States is expected to reach $130 billion by the end of this decade. This is also evident from the fact that Lilly and Novo are not only investing heavily to optimize their production capacities but have also started evaluating multiple other novel obesity candidates in their pipeline.
Based on the success seen by Lilly and Novo in the obesity space, several other companies like Viking Therapeutics (VKTX - Free Report) , Amgen (AMGN - Free Report) and Rocheare also developing their obesity drugs in clinical studies.
Viking’s VK2735 is being evaluated as a subcutaneous (SC) injection and as an oral pill in a mid-stage study and an early-stage study, respectively. The drug has shown immense potential, having demonstrated superior weight reduction capabilities in both clinical studies. Viking expects to advance both formulations of the drug into further development before 2024-end.
Alongside its first-quarter earnings report, Amgen announced that it has completed an interim analysis of data from a mid-stage study, MariTide. Though AMGN did not discuss any numbers, it was ‘very encouraged’ with the interim data. The top-line data from this study is expected later this year. Based on these interim results, Amgen has already started planning for a broad late-stage program on the drug across multiple indications.
Roche recently forayed into the obesity market after it acquired privately owned Carmot Therapeutics for $2.7 billion in January.
Eli Lilly and Company Price
Eli Lilly and Company price | Eli Lilly and Company Quote
Zacks Rank
Eli Lilly currently carries a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.