Eli Lilly’s Hidden Gem: A Cancer-Fighting Powerhouse
The pharmaceutical sector has been abuzz with glucagon-like peptide 1 (GLP-1) agonists, particularly Novo Nordisk’s Ozempic, for treating diabetes and weight management. However, Eli Lilly has been quietly building a formidable presence in the oncology space, which could be its next big opportunity.
A Growing Market
According to Coherent Market Insights, the global oncology drug market is projected to reach $533 billion by 2031, more than double its current value. While names like Pfizer, Bristol-Myers Squibb, and Merck may come to mind first, Lilly has a thriving oncology operation that’s being overshadowed by its weight loss portfolio.
Verzenio: A Star Performer
Through the third quarter of 2024, Lilly generated $31.5 billion in revenue, with $15 billion coming from just three drugs: Mounjaro, Zepbound, and Trulicity. However, Verzenio, Lilly’s main oncology treatment, saw sales top $3.7 billion, growing 38% year over year. This accelerated growth rate outpaces Lilly’s overall business performance.
Expanded Indications and Clinical Trials
Verzenio’s success can be attributed to an expanded indication granted by the FDA in March 2023. Lilly isn’t stopping there, with seven clinical trials underway exploring new molecules and applications in the cancer market. The company has also acquired STX-478 from Scorpion Therapeutics for up to $2.5 billion, further bolstering its oncology ambitions.
Diversification and Growth
Despite some turbulence between supply and demand, Mounjaro and Zepbound are still on pace for a record performance in Q4. However, it’s essential to look beyond weight loss when investing in Eli Lilly. The company’s diversified portfolio and notable success in areas outside of GLP-1 agonists make it an attractive opportunity.
Oncology: A Hugely Important New Area
With the size of the addressable market and Lilly’s clinical pipeline, oncology represents a significant new area for the company. Management’s forward-thinking approach, evident in its recent acquisition, drives home the point that Lilly is poised for long-term success.
Don’t Miss the Boat
Investors who feel they’ve missed out on successful stocks may want to consider Lilly’s oncology business. With the company’s diversified portfolio and growing presence in the cancer market, now may be the perfect time to invest before it’s too late.
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