Eli Lilly Weight-Loss Pill Trial Disappoints, Offsetting Solid Profit and Sales

Ely Lilly (LLY) shares sank 14% Thursday when the pharmaceutical firm reported disappointing results from a late-stage study of its experimental obesity pill. The news offset Lilly’s strong quarterly results.

The company said in a Phase 3 trial, patients taking a 36 milligram dose of its oral GLP-1 drug, orforglipron, without food and water restrictions showed an average weight loss of 12.4%, or 27.3 pounds, in a 72-week period. That’s below the 15% average weight loss of rival Novo Nordisk’s (NVO) Wegovy injectable treatment. Some on Wall Street were looking for orforglipron to come in closer to that level.

In an interview, Lilly CEO David Ricks argued that the company wasn’t disappointed with the results even though they were “one or two points below what (the) Street had.” Ricks added the goal was to create a pill that was convenient to take, could be made on a huge scale, and would provide weight loss that was competitive with other GLP-1 medicines, “and that’s what we’ve achieved.”

The company explained that it plans to seek regulatory approval of orforglipron by the end of the year.

Eli Lilly Reports Better-Than-Expected Q2 Results

Along with the orforglipron announcement, Lilly released its second-quarter financial data Thursday, reporting adjusted earnings per share of $6.31, with revenue up 38% year-over-year to $15.56 billion. Both exceeded Visible Alpha forecasts by a wide margin.

The gains came from soaring demand for its current weight-loss drug, Zepbound, which had a 172% jump in sales to $3.38 billion. Sales of another GLP-1, Mounjaro, used to treat both obesity and Type-2 diabetes, were up 68% to $5.20 billion. 

Lilly raised its full-year adjusted EPS range to $21.75 to $23.00, compared to the earlier estimate of $20.78 to $22.28. It sees revenue of $60 billion to $62. billion, versus the previous outlook of $58 billion to $61 billion.

Shares of Eli Lilly traded at their lowest level since January 2024. However, the study outcome lifted U.S.-listed shares of Novo Nordisk 7%.