Eli Lilly’s Third-Quarter Earnings Fall Short of Expectations
Pharmaceutical giant Eli Lilly has reported disappointing third-quarter earnings, with profits and revenue failing to meet analyst expectations. The company’s stock price plummeted 10% in premarket trading, while shares of its main rival, Novo Nordisk, fell by approximately 3%.
Disappointing Sales of Blockbuster Drugs
Eli Lilly’s third-quarter earnings were weighed down by lackluster sales of its flagship weight loss drug, Zepbound, and diabetes treatment, Mounjaro. Zepbound generated $1.26 billion in sales, falling short of the $1.76 billion predicted by analysts. Meanwhile, Mounjaro posted $3.11 billion in revenue, but this was still below the expected $3.77 billion.
Supply Chain Issues Easing
Despite the disappointing sales figures, Eli Lilly’s supply chain issues are beginning to ease. The company has invested heavily in increasing manufacturing capacity for its incretin drugs, including Zepbound and Mounjaro. As of Wednesday, the Food and Drug Administration’s database indicated that all doses of these medications are now available in the US, following extended shortages.
CEO David Ricks Addresses Performance
In an interview, Eli Lilly CEO David Ricks attributed the third-quarter performance of Zepbound and Mounjaro to inventory decreases among wholesalers, rather than supply chain issues. Ricks also revealed that the company had delayed plans to advertise and promote Zepbound due to customer service concerns. These efforts will now begin in November.
Future Outlook
Eli Lilly has revised its full-year adjusted earnings guidance, expecting earnings of between $13.02 and $13.52 per share, down from previous estimates of $16.10 to $16.60 per share. The company has also lowered its revenue outlook for the year, anticipating sales of between $45.4 billion and $46 billion.
Compounding Pharmacies Raise Concerns
The FDA’s decision to remove tirzepatide, the active ingredient in Zepbound and Mounjaro, from its shortage list has sparked opposition from compounding pharmacies. These pharmacies produce customized and sometimes cheaper alternatives to Eli Lilly’s branded medications, raising concerns about safety and efficacy.
Conclusion
Eli Lilly’s disappointing third-quarter earnings have raised concerns about the company’s performance, despite easing supply chain issues. As the pharmaceutical giant moves forward, it will be crucial to address these challenges and meet the evolving needs of its customers.
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