Eli Lilly’s Revenue Guidance Takes a Hit Amidst Competition in Weight Loss and Diabetes Markets
The pharmaceutical giant, Eli Lilly, has revised its revenue guidance for 2024, citing lower-than-expected demand for its weight loss and diabetes drugs. This news sent the company’s shares tumbling by approximately 6% in early trading on Tuesday.
A Shift in Expectations
Eli Lilly now anticipates full-year 2024 revenue of around $45 billion, a decrease from its initial projection of $45.4 billion to $46 billion in October. Although this revised outlook still represents a significant 32% increase in revenue from the previous year, it falls short of Wall Street’s expectations.
Q4 Revenue Projections
For the fourth quarter, Eli Lilly expects to generate $13.5 billion in revenue, which includes $3.5 billion from its diabetes treatment Mounjaro and $1.9 billion from its obesity drug Zepbound. These figures are lower than the $13.94 billion and $45.49 billion projected by analysts for the fourth quarter and full-year 2024, respectively.
Competition Heats Up
The revised guidance comes as Eli Lilly faces increasing competition from Novo Nordisk and other smaller rivals in the rapidly expanding weight loss and diabetes drug market. To stay ahead, the company is developing a more convenient and easier-to-manufacture obesity pill, which is expected to receive approval as early as next year.
CEO Weighs In
According to CEO David Ricks, the company’s previous guidance had anticipated even faster growth acceleration for the quarter, which didn’t materialize. Additionally, lower-than-expected channel inventory at year-end contributed to the revised Q4 results.
Looking Ahead to 2025
Eli Lilly expects sales to reach $58 billion to $61 billion in fiscal 2025. The company is set to report its full quarterly results on February 6.
A Challenging Landscape
As the pharmaceutical industry continues to evolve, companies like Eli Lilly must adapt to changing market conditions and increasing competition. The revised revenue guidance serves as a reminder of the challenges faced by drugmakers in the weight loss and diabetes markets.
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