Eli Lilly lifts 2024 revenue guidance by $2 billion on weight-loss pills demand

The company's incretin medications experienced heightened demand, surpassing supply increments.

US pharma manufacturer Eli Lilly has increased its full-year revenue projection by $2 billion, buoyed by robust sales of its weight-loss drugs.

Revenue surged by 26 percent to $8.76 billion in the first quarter of 2024, propelled by key products including Mounjaro, Zepbound, Verzenio, and Jardiance, as stated during an investor briefing on April 30.

Mounjaro (a type 2 diabetes drug) and Zepbound (a weight-loss drug) have gained traction, particularly in weight-loss protocols.

The company's incretin medications, which control blood sugar, experienced heightened demand, surpassing supply increments. Efforts to bolster manufacturing capabilities are underway, with a substantial production escalation anticipated in the latter half of 2024, the company added.

Revenue in the US increased 28 percent to $5.69 billion, driven by a 16 percent increase in realised prices and a 12 percent rise in volumes. The higher realised prices in the US were driven by Mounjaro. The increase in US volumes was driven by Zepbound, Mounjaro and Verzenio, partially offset by a decrease in Trulicity (a cardiovascular drug).

High demand for the company's incretin medications resulted in wholesalers facing backorders for these products at the end of the quarter. Foreseeing a sustained tight supply situation, the company anticipates that the burgeoning production volume will struggle to keep pace with demand.

In the foreseeable future, Lilly projects that the sales growth of incretin medicines will predominantly hinge on the quantity the company can manufacture and distribute.

Also read: Riding on Novo Nordisk’s semaglutide, India’s weight-loss market triples in size in 2 years

Gross margin increased 33 percent to $7.09 billion in Q1. The gross margin as a percent of revenue was 80.9 percent, an increase of 4.3 percentage points.

The increase in gross margin percent was primarily driven by higher realised prices, a favourable product mix, and, to a lesser extent, improvements in the cost of production, the company said.

For Q1, worldwide Mounjaro revenue was $1.81 billion compared with $568.5 million in Q1 of 2023. US revenue was $1.52 billion compared with $536.4 million in Q1 of 2023, reflecting higher realised prices due to decreased utilisation of savings card programmes (insurance programmes that provide medicine at cheaper rates) as access continued to expand, as well as increased demand.

Also read: Biocon bets big on new class of weight-loss drugs