Eli Lilly’s Revenue Forecast Takes a Hit
A Shift in Expectations
Eli Lilly has revised its 2024 revenue forecast, citing unexpected market dynamics and stocking levels in the diabetes glucagon-like peptide-1 receptor agonist (GLP-1RA) market. The company now expects global revenue of approximately $13.5 billion for Q4 2024, a 45% increase from Q4 2023, but still 3% short of its initial guidance.
Strong Performance of Incretin-Based Drugs
The company’s incretin-based drugs, including Mounjaro (tirzepatide) and Zepbound (tirzepatide), have been driving growth, with sales reaching $3.5 billion and $1.9 billion, respectively. Additionally, non-incretin products across oncology, immunology, and neuroscience have seen a 20% increase in revenue.
Challenges in Predicting Growth
CEO Dave Ricks acknowledged the difficulties in predicting growth in the rapidly expanding GLP-1RA market, stating, “It’s always disappointing to miss your own expectations. We’re dealing with a business that is unprecedented in our sector in terms of size, scale, and growth rate.”
Manufacturing Investments and Shortages
Last year, the company faced significant disruptions due to shortages of tirzepatide, which drove some patients to seek alternatives from compounding pharmacies, impacting sales momentum. The FDA declared the shortages over in December 2024, following substantial manufacturing investments by Lilly.
Lawsuit Against Compounding Pharmacies
Eli Lilly has asked to join an opposing lawsuit brought by compounding pharmacies against the FDA, as the company believes it cannot rely on the FDA to fully defend its interests. The court case will determine whether compounding pharmacies can continue selling cheaper versions of Lilly’s tirzepatide-based drugs.
Meeting Surging Demand
To meet the growing demand, Lilly plans to increase production of saleable doses of incretins by at least 60% in the first half of 2025 compared to the same period in 2024.
Competition in the GLP-1RA Market
The revised guidance highlights the intense competition in the GLP-1RA market, dominated by Novo Nordisk and emerging players. Eli Lilly is advancing its portfolio with an oral obesity drug, which could further strengthen its position in the market.
Long-Term Growth Prospects
Despite the recent revision, Lilly remains optimistic about its long-term growth, forecasting 2025 sales between $58 billion and $61 billion. The company is focusing on expanding access to obesity treatments, leveraging new therapeutic indications, and ensuring pricing stability across its portfolio.
Diversification in Revenue Streams
Beyond incretin-based drugs, Eli Lilly is driving growth in oncology, immunology, and neuroscience, demonstrating diversification in its revenue streams. The company plans to release its full Q4 2024 results on 6 February 2025.
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