The Zhitong Finance app learned that before the market on November 2, Lly.US (LLY.US) announced financial results for the third quarter. According to financial reports, the company's third-quarter revenue was 9.5 billion US dollars, up 37% year on year, exceeding market expectations of 9.02 billion US dollars; net loss of 57.4 million US dollars, net profit for the same period last year of 1,452 million US dollars; adjusted net profit of 94.8 million US dollars, down 95% year on year; adjusted earnings per share of 10 cents, and the market expects a loss of 13 cents per share. In terms of guidance, Lilly lowered its full-year adjusted earnings per share forecast from $9.7 to $9.9 to $6.50 to $6.70.

Lilly reported third-quarter revenue that surpassed Wall Street expectations, mainly due to the company's blockbuster diabetes drug Mounjaro and its promising line of obesity drugs. Q3 sales of this best-selling product increased to $1.41 billion, up 44% over the previous month, exceeding analysts' expectations of $1.26 billion.

According to information, investors have high expectations for Mounjaro's potential treatment to surpass diabetes. Some studies have shown that it may be more effective than Novo Nordisk's popular Wegovy and Ozempic injections for weight loss. Earlier this year, Eli Lilly applied to the US Food and Drug Administration (FDA) for approval of the injection for long-term weight management.

Analysts at J.P. Morgan, headed by Chris Schott, said in a report that Eli Lilly's other portfolios had mixed results. Lilly's biggest diabetes drug, Trulicity, had sales of $1.67 billion, which fell short of analysts' expectations, while Verzenio, the third-largest breast cancer drug, had sales of $1.04 billion, exceeding expectations.

However, J.P. Morgan analysts say Lilly is still “one of our favorite companies.”

As of press release, the stock rose more than 1% before the market to $561.14. By Wednesday's close, the stock had accumulated gains of more than 50% so far this year.

The growing market for diet pills

By 2030, the global obesity market is expected to reach 100 billion US dollars, and Eli Lilly and Novo Nordisk (NVO.US) will be leaders in this market. The market's enthusiasm for the diet drug market drove the stock prices of these two drug companies to new heights. Among them, Lilly is now the most valuable healthcare company in the world, and Novo Nordisk, the manufacturer of Ozempic and Wegovy, won the title of Europe's most valuable company in September.

Eli Lilly and Novo Nordisk are working to meet market demand for their products. Danish drugmaker Novo Nordisk said on Thursday that it will continue to restrict certain doses of its diet drug Wegovy next year.

However, Mounjaro is still listed in the Food and Drug Administration's shortage database. It is worth mentioning that in a slide released before the investor conference call, Lilly said that sales of the drug “significantly exceeded” previous injection products similar to type 2 diabetes, including Novo Nordisk drugs.

In addition to diet pills, Lilly said the company's experimental drug for Alzheimer's disease, Donanemab, is expected to be approved early next year, not this year. In last-stage trials in early Alzheimer's patients, the drug reduced the condition by 35% over a year and a half.

Looking ahead, Lilly lowered its adjusted earnings per share forecast for 2023 from $9.7-9.9 per share to $6.5-6.7 per share to reflect R&D expenses in the third quarter. Furthermore, the company maintained revenue expectations of US$33.4 billion to US$33.9 billion unchanged.