8) Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holdings: 100
Eli Lilly and Company (NYSE:LLY) is engaged in discovering, developing, and marketing human pharmaceuticals worldwide. Eli Lilly and Company (NYSE:LLY) saw significant attention because of its success in the obesity and diabetes markets, primarily with its GLP-1 receptor agonists Mounjaro (tirzepatide) and Zepbound.
Zepbound and Mounjaro are regarded as the key drivers of the company’s recent growth. These GLP-1 receptor agonists have demonstrated robust traction in the market. Wall Street analysts opine that Zepbound’s total prescriptions (TRx) touched new highs, while Mounjaro has been performing well. The success of these products strengthened Eli Lilly and Company (NYSE:LLY)’s position in the competitive obesity and diabetes markets.
The company has a diverse portfolio of products throughout various therapeutic areas. Its ability to develop and market successful drugs across multiple categories supports its overall financial stability and growth potential. Eli Lilly and Company (NYSE:LLY) announced a $4.5 billion investment to create the Lilly Medicine Foundry. This facility should offer the ability to research new ways of producing medicines, while, at the same time, scaling up the manufacturing of medicines for clinical trials.
Eli Lilly and Company (NYSE:LLY) has been exploring new areas like mental health while expanding its obesity treatment opportunities. The company’s significant investments focused on expanding its manufacturing capabilities, mainly in Ireland, place it well for future growth. Moreover, the expanded manufacturing capabilities should result in economies of scale, potentially resulting in improved profit margins over time.
Analysts at Bank of America increased their price objective on the shares of Eli Lilly and Company (NYSE:LLY) from $1,000.00 to $1,125.00, giving a “Buy” rating on 9th August. PGIM Jennison Health Sciences Fund released its Q2 2024 investor letter. Here is what the fund said:
“Eli Lilly and Company (NYSE:LLY) is a diversified biopharmaceutical company with core franchises in Diabetes, Obesity, Immunology, Neurodegeneration, and Oncology. The company is one of the two global leaders in diabetes with blockbuster products in Trulicity and recently launched Mounjaro (tirzepatide) to serve this large underserved market. To date, the Mounjaro launch is the strongest for any diabetes drug ever launched, which we attribute to off label usage in the obesity indication as well as on label use in diabetes. We believe the tirzepatide (the generic name for Mounjaro) franchise is also uniquely positioned to grow substantially from here thanks to its recent approval for obesity. To that note, in late 2023, Eli Lilly received approval for tirzepatide in obesity and is commercializing it for obesity under a new brand name, Zepbound. While still early in the launch, uptake has been extremely strong, exceeding that of both Wegovy and Mounjaro at the same timepoint in their launches. While Alzheimer’s Disease has been a tough market for drug developers, Eli Lilly has breakthrough designation from the food and drug administration (FDA) for donanemab and recently presented Phase III pivotal trial data that positions donanemab as the most efficacious drug in the class. In June, the FDA advisory committee voted unanimously in favor of donanemab as an effective treatment where the benefits outweigh the risks, praising the therapy as innovative. Donanemab was then approved under the brand name Kisunla in early July. Eli Lilly also has exciting franchises in dermatology, immunology, and oncology that are starting to add meaningfully to growth. With a proven history of strong commercial execution and one of the highest research and development (R&D) success rates in the industry, we see opportunity for continued success. With a lack of meaningful patent expirations for the rest of the decade. Eli Lilly is uniquely positioned amongst its larger-cap peers. Recent positive performance has been driven by the continued strong growth of Mounjaro and Zepbound, which led to a big guidance raise on the 1Q call, an unusual action for Eli Lilly this early in the year, which speaks to their confidence in the strong trends they are seeing.”
