Eli Lilly and (LLY) 8 Aug 242024 Q2 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Lilly Q2 2024 Earnings Call. [Operator Instructions] I would now like to turn the conference over to your host, Joe Fletcher, Senior Vice President of Investor Relations. Please go ahead.

Thanks, Paul. Good morning, everyone. for and us Earnings QX joining Call. for Eli Company's Lilly XXXX Thanks Senior Investor President Joe Vice I'm Fletcher, of Relations. And joining Chairman Dr. Lilly's Dave are me on and today's CEO; call Ricks, and Gordon and Anne Oncology; Officer; President and of of International; of Yuffa, President of Officer Jake Chief Ilya White, Scientific Lilly Neuroscience; Patrik and of Chief Financial -- Jonsson, Skovronsky, Lilly Dan Lilly Cardiometabolic Lilly Immunology; President Brooks, Lilly Van Interim Financial President USA. President Health Lilly Naarden, Mike Irons, Makela Lauren [ by joined also team. we're of ] IR Springate, the And Zurke

During and this our making conference call, we forward-looking current anticipate projections on statements based expectations.

results X. to several actual factors, Slide differ on listed Our materially could including due those

concerning is the filings information to with that our results and actual differ contained subsequent Additional SEC. materially could latest factors cause in Form XX-K

is prescribing provide promotional our benefit not information the and community. for pipeline be intended the to The sufficient decisions. products of not for investment It's is about and we

transition will to prepared we note non-GAAP please remarks, on measures. focus As our commentary our that financial

I'll Now over Dave. to the turn call

It's Joe. trajectory at Lilly quarter. second time an here growth the in accelerated as our exciting Thanks,

in to investments the people innovative Our manufacturing focused world. more around Lilly bringing medicine expansion are on advancing medicines are

for can to second the see XX% same period to compared X, and the Slide access year. in with expand. is of Mounjaro our demand and the Zepbound growing QX continue in as On to you strategic deliverables. performance nearly supply growing quarter billion $X.X financial related progress strong grew and details our Revenue new and U.S. products last

due to our our high volatile in us outlook. the weekly half progress confidence was the gives demand, first While fulfilling prescription year in of challenges on supply volume

of performance across as other saw business the impressive QX areas well.

the Baqsimi XX% accelerate revenue that in billion of was of sale in year, year. increase $X the with including United growth guidance Excluding the growth through to expectation momentum reflects spread the growth will States. the our geographies, across And non-incretin rights balance XX% worldwide last our

the We the the failure from the including donanemab the approval with Japan of approval milestones, Kisunla, and to EU U.S. resistant III achieved severe the moderate obesity. the Phase for of in sleep tirzepatide people several tirzepatide adults who inhibitors, obesity treatment positive disease, treatment with U.S. apnea for in fraction of injection SUMMIT refractory lymphoma and for top the name submission in to BTK for and intolerant preserved the other or or the in results line the Jaypirca relapsed brand Alzheimer's key mantle cell pipeline are in trial with obstructive with heart adults evaluating of of

has a now development public our strategy significant broad opportunities health dosage rational pursuing medicines Lilly long-term business and to is address form. new create our active this internal growth. a In support opportunity every crisis, mechanism, portfolio against comprehensively and indication global obesity, through to to

are We molecules XX indications. have now investing and new multiple broadly clinic the currently disease across in this in

a has tirzepatide, obesity also next and agonist. molecule, data investing Phase Phase trials GIP/GLP-X recently our of in in wide OSA III positive currently our program year. with We in glucan With diabetes the starting shared III readout underway Orforglipron, GLP-X comprehensive oral late-stage programs. of try nine running and -- We're range and a tirzepatide small

in type a readouts broad renal and initiated We osteoarthritis, as start program obesity, outcomes have These molecule XXXX. cardiovascular X Phase OSA, diabetes. development studying as the III in well

in manufacturing largest Lebanon, our our In the pharmaceutical sites, billion Indiana manufacturing in is announced States. of remains medicine ambitious synthetic expansion this in investment there We believe our active additional bringing Our history single United May, to top executing priority to we ingredient an manufacturing invest plans on total the $X $X.X investment the agenda. billion.

we pharmaceutical than to see have ingredients will upgrade began and expansion -- $XX this we to or and these Since acquire the billion manufacture active of U.S. in XXXX, committed facilities Europe, enhance Zepbound the more Mounjaro. benefit to Importantly, investments. for build, and

Lilly We Research are contract making existing like and organizations. manufacturing near-term progress to ramp sites at new production, Park, including Trial sites

North process expect of the Our is available Carolina the validation will XXXX. well. progressing in We're production of facility site XXXX this end Concur ship in and to with initiate product by running

We also for on different tirzepatide. continue to presentations make progress

our markets quick pen launch here the of vials in launched remarks, now adoption. have will And plans patient positive We U.S. the our early in he U.S. outside multidose in indicators multiple preview Gordon's with to

of serious therapies we biopharma -- company Lastly, external diseases, a a evaluated treatment to Morphic, a innovation. II In asset July, in disease. including in terms being of chronic for acquire oral inflammatory developing announced definitive Phase agreement bowel

X, since the events Slide list including other mentioned you'll important QX milestones of earlier key our and call, see updates. On several I a

your organization June, financial resigned we As thank Ashkenazi Alphabet. last of X partnership of wish leadership announced We Officer years. in in Lilly's CFO her Chief Financial the in for to Anat new as our role and and well become the her Anat

We internal as with Gordon have and been currently the also controller and the our Gordon the Interim corporate named the company. CFO an has external successor for for for company search as is underway. strategy serves group Anat leader Brooks years of and XX

of welcome Global company's company of Norton's John a service years as and for I [ executive Enterprise the of Seymour Willms the of his of to our service. recent retirement. want years year President and Alonzo will Officer, team. Quality end to Vice other and [ Melissa Ethics has In the Executive Lilly leadership thank ] Alonzo Compliance Management member ] XX after Vice our the Chief of joined Executive [ Risk following ], many and committee And at retire news, the President Melissa

review me our over QX Gordon financial the to to call turn let results. Now

Thanks, Dave.

the the I'm So X, financial quarter on which summarizes XXXX. Slide of second in performance

to revenue and year, grew growth 'XX. last of by was Gross of margin costs. prices, revenue XX% XX%. QX Verzenio. revenue of rights the well XX% in margin in of of quarter in Gross realized QX the a as Second from production in and driven -- product primarily from excluding percent higher favorable increased Mounjaro from quarter as Baqsimi When as QX benefited revenue partially 'XX by XX.X% Zepbound of higher sale to offset

R&D driven by XX%, in investment increased expenses increased promotional and investments and efforts associated well selling by in primarily in our administrative and portfolio launches expenses people. our continued as our XX% driven people. as Marketing, ongoing future

rate XX% operating was non-GAAP in income by by 'XX new increased XX.X% a effective from XX.X% basis in on products, compared offset QX Operating QX, growth. higher revenue driven expense tax The of partially with rate of sale earnings the 'XX mix of for a tax Baqsimi. in from the reflects QX earnings tax QX in reflected rights The impact the 'XX of of higher rate QX jurisdictions, 'XX. while

to of line, of $X.XX per results the negative QX delivered bottom we compared prior XX% the impact the prior $X.XX from of share an year. to in include quarter, in QX, acquired 'XX charges QX At 'XX. a increase earnings IPR&D compared $X.XX

access On XX%, 'XX price, Volume Slide of QX effect largely and Mounjaro by Realized was of the partially driven X, by revenue Zepbound, Trulicity. we sale XX% card Verzenio, dynamics. savings in declines rate quantify XX% and on driven in Mounjaro volume and for QX. increased rights of and U.S. revenue prices by Baqsimi in growth increased growth. of offset

majority medicines rebuilt demand account In as stocking XXXX fulfilled our aggregate positively of percent estimate QX we of our wholesaler and -- quarter high growth QX. in by of wholesaler sales of for stocking low unprecedented Mounjaro call, that were end levels. QX in totaled orders, we incretin sales a channel the second earnings noted these the we as for in QX, improving U.S. U.S. teens to extremely to these the Zepbound levels at the back inventory and mid-XXs impacted led brands. estimate As that spring to back from We the orders

available doses are and reflected shows as Trulicity and doses on the is group's which supply that We FDA listed website, shortage Zepbound, the two lower available. the Mounjaro pleased of all of situation currently as

back orders medicines continue complex, different note more at supply for to the the wholesaler experience have substantially, the patient doses. pharmaceutical refrigeration pharmacy and result chain These that important in so require While several counter. variability U.S. that may is factors it's at to in been reduced in the offer

has supply result and come may supply into balance, better demand expect periodic in demand for levels. dose presentations increase While certain in tightness and we

look have We further supply, we'll to increase continue and to options. all broad at agenda continued a

we launch of Today, the in the to details are X.X-milligram to the time. with excited announce further expand X-milligram plans Zepbound to access come that and files with weeks single-dose more at to coming

the in grew constant Mounjaro uptake In Germany. primarily XX% U.K. launch Europe, revenue and driven currency, by in

volume strong volume growth by offset Jardiance, also decreased from Trulicity. had from partially which was We Verzenio,

Mounjaro currency. Japan in in Volume performance was growth quarter of and revenue the driven growth with by XX% second constant of XX% Verzenio. was strong uptake

by and driven weight QX China. by China recently currency. Cialis. in Trulicity approved and to partially Olumiant was X% chronic was revenue offset Taltz, and type for increased -- Growth X diabetes Mounjaro constant in management. Moving

not timing We have announced in yet expected this market. launch

Revenue in from driven XX% World volume dynamics. primarily and currency, Rest growth in by demand of Mounjaro constant increased channel

which geographies Slide XX%, across solid revenue our by Jaypirca sales in Verzenio product growth driven the on XX CLL categories. payment building growth, uptake worldwide, from the partner patient increased Japan. on the MCL related to Jaypirca a populations. milestone cancer across worldwide quarter breast provides perspective $XX indication. million with and additional performance the quarter-over-quarter $XX continued both included impressive second major increasing early million brand's to

These international markets continue code on with U.S. expect of the to progress X. launches increasing million went starts. live well in July launched QX. to sales patient the the is And XX sales [indiscernible] as with in accelerate and we U.S., in product-specific $XX

U.S. outside earlier. in as with the channel $XXX were $X.X dynamics Mounjaro million. the continued improved Mounjaro seeing in the uptake in solid We're as QX globally sales growth demand with billion discussed U.S. U.S., Revenue in the sales $X.X in reflected billion totaling well QX strong

first presentation the the half the quick of U.K., launched pen we UAE. the in Germany year, In and the

also Pen we've Mounjaro launch Quick QX, Spain throughout launched in markets XXXX. far an to So plan additional and in

supply XX% improved QX, stocking declined due XX%. services. and decreased U.S. offset lower to Trulicity primarily partially revenue Trulicity revenue levels competitive dynamics by driven In on worldwide by wholesaler constraints, volume,

XX. Slide to Turning

seen We has trends have billion QX. ramped leading for as in to of an accelerated production that Zepbound. update over Zepbound launch on $X.X the We've sales growth U.S. have of exceptional

medicine July for We anti-obesity growing and access that coverage as We in are opted X had rapidly in as into building employers XX% and of modestly approximately commercial coverage. to our the we formulary have see XX% expand coverage Zepbound of estimate over the U.S. work segment.

Slide provide capital update an we our On XX, on allocation.

financial updated our XXXX guidance. shows XX Slide

be We our billion. year $X outlook Mounjaro are between due is by across Zepbound. full to and $XX.X medicines as performance strong non-incretin revenue million well as to $XX.X and raising increase billion our This

our timing U.S. outside improved and we Additionally, the into production have pace clarity expansion of the Mounjaro launches and

the in supply-related increased in medicines and X.Xx will of production that salable salable least second milestones expectation of number a XXXX QX half taken of at our achieved doses XXXX. the half have We be regarding confidence doses of incretin of

of below compared Based the of second revenue QX. half second midpoint the growth year, year, a half on XX% In in range, of QX updated expect in the significant ] our implies first the the we XX% the in half. of the growth more [ guidance to

Given to basis XX% on of guidance, to margin the OpEx update XX% basis. non-GAAP revenue revenue expect range to now be in a the by reported gross XX% ratio XX% we divided and the on to a less of

reported interest through For million between expect on non-GAAP expense on expense ranges of million now QX basis. $XXX million reflects Both securities a equity the reflect and basis, million other income net a we 'XX. expense in and $XXX between investments and of expense, and net and losses on of lower $XXX reported range expected $XXX

well to charges on 'XX QX IPR&D -- Earnings $XX.XX have the on of QX The reported $X.XX. in of now of mix through with the anticipated expected basis. forecasted be as share in mentioned as earlier to our range in estimated per range a changes includes effective to of higher a Both earnings rate non-GAAP basis tax associated is to driven We a XX%, reported by approximately jurisdictions. $XX.XX our ranges payments. increased in updates tax charge acquired $XX.XX $XX.XX be litigation

our highlight turn Now over R&D. to call to I'll on progress Dan the

been for busy Kisunla on heart start the the another updates Thanks, approval, I'll Phase III then the FDA comments Then cover finally, tirzepatide Gordon. rest failure readout. quarter. quarter. the It's with I'll the of

the safety Alzheimer's of FDA had and of of discuss are, package chance another compelling present Advisory about of efficacy course, very to we June This Kisunla this treatment excited meeting We Committee followed the the data characterizing the where for disease. approval medicine. and

of levels. the to pleased were nearly study minimal data to when by discussion completed particularly once limited result In supporting FDA along with costs removed are the of treatment We of required. stopping infusion believe schedule, their in amyloid plaques out-of-pocket Kisunla XX in trial, our lower fewer advisers, and of infusions half our therapy participants course treatment monthly with a therapy, patient could months. Kisunla We regard with duration

all of of Kisunla The including amyloid vote Then FDA weeks labeling was unanimously physicians may questions later, a that stopping positive dosing on the approved few based presented. plaques. consider on reduction Kisunla,

Following that of approval, begun we we're as launched medicine clinical the and practice. receiving Lilly delighted see this July part Kisunla, already patients have to new

covered We that note approved for countries. action continue several Regulatory around CED is Kisunla world in yet with patients reviews broadly Medicare the registries. through this year potential

We're And TRAILBLAZER our a from genenimab positive X, received to pleased recently Medical III Agency have study, ALS the in as prevention Japan. for to Devices and opinion continues planned. Pharmaceuticals progress finally, Phase

SUMMIT III the positive XX, of and dose failure heart obesity. to which tolerated you'll Slide statistically with trial, results significant preserved treatment our Phase This demonstrated the in endpoints for of On improvements both to detection for primary Moving compared see study maximum fraction tirzepatide, tirzepatide. tirzepatide evaluated recent placebo.

for first or failure compared composite the heart was by The visit intensification diuretic outcome cardiovascular urgent oral endpoint, XX% the median endpoint hospitalization, by weeks. risk heart follow-up worsening placebo measured or of tirzepatide to as XXX a In death. of primary failure reduced this

XX compared significantly placebo weeks. physical to by XX.X in In the for reduction secondary Summary as weight key including to KCCQ baseline the heart Cardiomyopathy efficacy measurement symptoms measured limitations Kansas demand tirzepatide of X.X% improved was were points in endpoints compared and changes body met All the endpoint, Main this the from for as study, points Questioner, while at on score. second primary based tirzepatide, failure mean XX.X% is XX Clinical City placebo. placebo

and The consistent of including overall in tirzepatide safety SUMMIT SURPASS. with trial previously SURMOUNT profile tirzepatide reported was studies, the

starting upcoming plan a We and regulatory detailed medical journal. other review results results an later at peer to -- will year. submit submit agencies present FDA and to this We the to

potential other XX August across obesity. our internal the Slide start shows updates shows of events our the in X. select health, which known for key new In as business, cardiometabolic and opportunities is portfolio, name updates as of XX Lilly I'll formerly pipeline year. with Slide diabetes

In and June, presented Association results England of published results American primary sleep and and of obesity Meeting. in treatment key were Phase secondary achieved detailed studies. the New to we our endpoints tirzepatide Diabetes of III obstructive for Journal trials the apnea moderate Medicine, All in we for the these severe at

EMA. on XX.X% the sleep the Notably, in to one XX, of FDA as our key up apnea. secondary for endpoints, of that resolution tirzepatide obesity the participants met moderate tirzepatide to severe now submitted apnea treatment criteria disease the as Slide sleep to obstructive as We've of shown for well demonstrated of and

granted which We of priority as FDA breakthrough are XXXX, pleased action FDA end U.S. that has we therapy granting dependent and the review. the designation, on as will expect the regulatory be early

trial Stage England Journal or of the Association in results published II these [indiscernible]. dysfunction the metabolic with from at we we results of fibrosis or New associated our for presented and European the steatohepatitis, June, for MASH, Study in tirzepatide Also III Phase II

of show We on read-through which more liver are pleased we're the with weeks the We're in Phase potential Phase tirzepatide improvement that a on in authorities in in Slide half registration and significant secondary potential fibrosis improvements taking these than encouraged by a to also of showed engaged also shown achieved at patients retatrutide, to II. as III XX strategy, regulatory results fats XX. endpoint,

look diabetes endpoints III QWINT-X glargine insulin for AXc primary for and be the of time each of sharing QWINT-X line Detailed of to line efsitora data adult per QWINT well insulin insulin data was [ trials non-inferior QWINT-X European the XX degludec our naive previously insulin Meeting. we this weekly Study at once-daily the also QWINT-X program forward and later day tolerated. for weeks both We and two reduction. treatment quarter, and from compared top efsitora Diabetes will meal safe QWINT-X insulin efsitora type additional their Association trial Phase to called basal QWINT-X XX presented Annual met trials from treated This X results weeks alfa, with at in injections for least in the two once of year. efsitora, ]. adults. compared September for the to announced In daily in

We are in at investing pleased innovation Phase with glucose insulin, patients progressing agonist molecule I type for receptor aimed approaches in cell sensing modification disease our as progress to to insulin provide who and -- diabetes, therapy. breakthrough such require X our

function Earlier evaluating Incretins initiated outcomes see in updates, late-phase outcomes, you'll important renal Phase development as for cardiometabolic patients additional trial a potential treatment cardiovascular Phase indications, optionality retatrutide.. pipeline, our our other strategy molecules patients an we've opportunities In and Triumph help are taking offers incretin in molecules schedules. III to clinical in portfolio and having mechanisms, of look part I. at we us and formulations multiple across dosages,

agonist a a molecule for daily few. of GLP-X the GLP-X receptor once highlight NPAX is administration. non-peptide To small designed oral

expect to so not year, now it as identify it this listed We pipeline our move asset slide previously on had Phase to later disclosed. been II this we whereas

excited option more pursue of to to different diversity patients of diseases. we with with another oral possibility help the Given incretins, are about potentially having the indications

next-generation dual and halfway. its weekly We GLP-X also agonist monthly we are X, to is coagonist highlight longer today given the dosing molecule which a planning explore and

development. cardiometabolic our NRGX insufficient our we as have health further in was for of profile development clinical portfolio, agonist Elsewhere the stopped

Turning to oncology.

Japan approved refractory or people We or BTK lymphoma to with resistant are are pleased that Jaypirca who relapsed intolerant been has mantle for cell now inhibitors. in other

We for is I initiated folate also outcomes I to receptor levels two Nectin-X targeting index trial for compounds which asset, receptor. clinic expression an and Mablink Phase the from ADC relative agents. this trial phase the efficacy as ADC. important -- more all We've patients. at acquisition the of a improved next-generation in came our fully This target the a therapeutic early having improve Phase we've provides an opportunities design for initiated In view construct and to our oncology, existing with second

LOXO candidate We're next-generation data about we to ongoing believe compared We year. kinase molecule also PIX from our efforts. benefit greater that alpha. from the announcing patients progressed XXXX program look molecules that the We we've this its clinical which later program, profile and to discovery forward more have the XXX candidates and terminated in the evaluated we next have sharing our to the next potential our clinic putting and into targeted

In for immunology, terminated mirikizumab of severely antagonists active development for due the we've treatment to disease now agonist, moderately our in Japan. GITR efficacy. submitted to insufficient Crohn's We've

announced also ulcerative the And We and in reflect pending inhibitor, of deal to our colitis plan II acquisition Phase alpha-X-beta-X of Morphic. MORF-XXX, oral we for Crohn's integrin completion disease. the

in study in -- neuroscience, OGA by Phase Alzheimer's inhibitor, baseline in We're at recently Alzheimer's disease. its levels Finally the data anti-tau small the the for II symptomatic study the the reviewing failed tested. later OGA trials in detailed early measured year. primary of endpoint as our presentation conference to concluded dose clinical of meet the of results decreasing of molecule either two of this change

Alzheimer's to remain studying target a outcome TAP While disappointing, continue high to plan is this in negative as committed we Taobao. disease and conviction

I'll to now call Dave remarks. the turn closing for back

Thanks, Dan.

our was QX in by Zepbound Q&A, Exceptional progress and sum growth me Before briefly revenue quarter. go up second driven we the in let Verzenio. to Mounjaro,

the production the in first half ramp of the ahead. in year with expansion expect pleased continued and are We

severe preserved submission in of Europe the disease, the and sleep III obesity. heart injection positive moderate with tirzepatide in for the obstructive apnea results U.S. to obesity Significant our the study of Alzheimer's for and Kisunla include from Phase fraction tirzepatide pipeline for failure and approval of and advances

our as product in ambitious investing well manufacturing are advancement launches, We of agenda. the as our expansion pipeline

teams All any world and history global bright company's of our a a to at this health in Lilly and scale. that the ahead than time better have incredible around future we leadership our give on work of impact human the opportunity confidence very

Now session. I'll to moderate to the Joe turn call over the Q&A

call as many Instructions] in to first provide Thanks, we're questions So to a the manner. possible the Q&A, the like instructions and Paul, callers Dave. and caller. take timely from . as conclude We'd ready [Operator for our for please

And today Instructions] the question from coming is from Seamus first [Operator Guggenheim. Fernandez

on of selling close not per stick on removing comments look market tirzepatide And in the calculations, the average trying to just look of sort reasonably with get sort seeing us price. just averages, given understanding cetera, concerns Novo's at It franchise the relative we ASP my pricing script, dramatically deterioration. of our prices movements The is By your to market, price. question. the you're to better when to really actually ASP selling rebates, with awareness inventory, I'm one with call, the I'll ASP yesterday of in et but higher so average regard a having higher real of what made

I question of are do as guess only that in Ozempic have seeing you see this of we this historically what And a with market as saw competition Trulicity an natural XXXX? from you I emergence evolution and as the is, kind here ASP perspective?

Seamus. Thanks,

I'll go or touch you Do Gordon. that, think to I want Patrick? on to

that. Sure. -- I'll Yes. for hang thanks the question. Seamus, with

second as moves half the out driven of just in streams, initial year away the So co-pay period. price in was the first of That program of the by Mounjaro. the half year the on goes base favorability

see of In 'XX. we quarters pricing in across pricing, stable terms sequentially

QX QX So stable to and and nothing pricing. sequential our QX continue guidance unusual, QX

second For be will the pricing. to dynamic the year the half year in second Mounjaro the half of prior don't pricing you have similar when

So see pricing. those in dynamics the are kind of we

Flynn The Stanley. next Terence Morgan question will from be from

all on for the one. just manufacturing. progress two-part that Congrats on me a the Maybe on

star that that's rolling if bound in X.X-fold sellable wondering of include or if out the the at vials you're U.S. a potential for unit in Just you're driver guidance the least doses increase Zepbound upside?

about maybe of But know RTP, the more a there. this meaningful at you step-up. continue of that scripts progress to you inventory today about think restock suggests we X/X about as The then And suggests make to through ramp peak. talked I way you're the

quantify ramp RTP? you in are the us can for you where in just So

Yes, sure.

think, want hop and... to do Dave, I in you

I just on X.X like second But the -- of can just we what saying the year. part of I about the we're can XX that. think left sort the given I today about would Yes, -- So vials say we have volume. reiterating is how think in is half weeks a are floor

limit that to the closure will part much there's container anyway. how up of the they and constrained a ship But finish of lines most chain, obviously, a still supply cartridges. uses open So it which of node different certainly in final the is than syringes or

probably So to show that it weeks. honest, will our to that be will just 'XX of up adds capacity, meaningful the that details part in new and in the coming as ramps the early coming be on most rollout form

in rather, end maybe off out nodes site across and many, relates supply I are that to also primarily levels just the it next this is through list. recover we its was and inventory the allowed more expect the to our totality site now of schedule, in product against read steadily production escalating well that of out mentioned goals. of But As RTP. RTP, time volume doing us wholesaler per year, track, is on That overall we FDA QX performance come performance network step-up the that Concord we our It's early many QX to shortage and of network. wouldn't shipped I year. of

question Schott next be JPMorgan. The will from from Chris

defending a that not market could obesity be the role breadth your the where in over time? to how emerging And earlier-stage you position in some developed on in by of surprised being debate in agents latest of of space. about But fits the I'm competitors play congrats see just market There you broadly. broader for sure these seems views interested the to newer competition terms the market entry you're and progress. in the think Lilly's all barriers

then... Maybe, on you to that? want And do start Dan,

Yes, [ BarCentry comments ]. some I'll R&D start on

first, think, III in approved. clinical having and The a Phase trials is I drug getting it successful

multiple You multiple portfolio can at once. pursuing populations our say, invested I III is thoroughly, we've often that in in Phase would indications see

to wait Just I it's investors being challenging I about develop robust But we seen releases we've a to we a space about particular able pretty know molecule. II excited get usually get have too that Phase point, Phase to and gotten of various data. excited drugs still data before until

thing. that's So the first

lot And only news make I right But to a companies I II wouldn't have see expecting of the we and think don't. the molecules which profile out which sort here. and seen it Phase data different we've XXX% as which get be from and success

A additional few comments.

we I the are at about barriers. think two marketplace, when look very important

been gaining in And XX% we the where X ] [ have marketplace, extremely quite access XX% in Part for We access across that's in and currently months are similarly, in commercial both D. successful Zepbound, Mounjaro, XX% after significant.

-- is the second The piece indications. amount of

Zepbound, III investing Mounjaro and and are the We similarly our in heavily for both Phase assets of -- retatrutide.

in are actually cetera, most leaning are side. not our firms had So I III extremely compete that see not that hands the -- the of we tomorrow. surprised are to this assets very have important And we space. on that today, into to think, in positioned we here. with cost -- different we we the assets referred think overall, Phase well But and market And to indications, therapy, deck all et are positioned well the we and today prepared remarks, compete both on what the

years different massive thing X Chris, are But our And our data highlighting that's follow-on. assets, a [indiscernible] And all tirzepatide had Phase MAD ago. [ targets. behind over I XX think, in here, maybe GIP/GLP XXXX, Maybe that last that for lead, a I agonists just was other one ] we we're -- reminder, us.

Dan advanced engagement, that based safety there. program On most on again, profile, target et the category program, in have we to oral follow-on the But to you more add of sort cetera. a portfolio today, we have side, highlighted get differentiation can and here, as

difficult to volume of The and categories is $X but really is on And things certainly this about scale, you're the probably don't category, making finally, which in volume up high takes scaling billion end manufacturing. the work history very it's know industry. And barrier, it's the do one of technically other, if the time highest in is one I talking being intensive. capital and will

will part. competitors come. already road in But for there's large ahead course, -- two that of So the walked leading a companies these have all

next from The Tim Wolfe be will question Anderson Research. from

have your I of tirzepatide. not question GLP-Xs, a limited on including, but compounders to,

And anyone companies to getting patent compounded something presumably meaning infringe How So GLP-Xs. Times patients So just can this IMS York or yesterday Novo, that courts, likely in is adjudicated in too? this you talked protection? get not with an is like and about article the the New upside else. down

on term think these the overdosing they compounded formulations. used I

So take from class. you could away not it only the do turn guys, sales of -- reputation compounders but also

to So do what Lilly can expect it? about we

Thanks, you want comments? start with Tim. Dan, some to

Thanks Tim. Yes. important topic, this raising for

Of taking watching of they're our out this been that course, we've business. not away really concern carefully,

As we've the here, largely rather having patient constraint you on it's but impact been health. know, supply

able often own our compounding found kinds all. secure We from isn't instances these are most part, labs. at most in to in And of what and is tirzepatide for we of them the samples labs this analyze kind

that we bacteria. not chemicals entirely, rather purchasing Our contaminated full find often which other of available sometimes or make drug producers either is often tirzepatide compounders, by to is they're of impurities

potential make take the we we so and we can . is This can patients patients that seriously that of dangers risk try to here safety a think help to to aware

a some. be regulators and considering actions from to just positions. kinds taken mean, obviously We're And all here. us of can Yes. public I and engaged you filed with policy standpoint, legal We've expect active

is it's is sense. see for of guess don't concerning. one. that to we tirzepatide. doses XXXA that's And industry manufacturing I under for with our that's we that compounding think why medically needs the and if in that there's patient long-standing a just provisions a shortages and be individual what step the mass medicine practice them more lot companies. with meant we not It's the But I customize a course, -- which parenteral FDA, Of in of other the production lead me would legal because back -- clear to constraints the of don't But reflect the

the by with have enforcement. way, GMP A compliant strict FDA we standards with And and is proving processes the or NXX lot investing are and constraint that enforced. that of that agree, Europe the those

the about little which is it's to So industry non-sterile that the create a a is product constraint, sterile another the product. to raising of to is that odd answer industry standards that

I So over coming can months we're front address And here this. think on out. see that to Lilly you the just foot pointing the

to thing primarily of on the We'll and real supply. as step employers vials, and as address with work the with to is another up drive coverage. increasing well availability the We to need government coverage expand insurance the increasing notch -- ultimately, But on we supply. that

issue. pretty are meantime, the But So hurt. we OBC as get those concerning an this points, affordable. people when what's People And in said, be will Dan it's get to can medicines happening.

will Next question from Umer be from Evercore. Raffat

in first I I on know line, it $X when by quarter, ask guidance you dropped if down want top on billion may. by to I $X.XX. operating the raised to leverage, guys the EPS

guidance. year numbers full your much basically much question quarter, Lilly's up what dropped year's a you went at higher instead, the is down be EPS momentum going guidance, XX% per And a forward billion, $X.XX right your XQ margin. or as almost is in so if now. year be I'm asking This of much at consensus leverage entire to as not guidance by to stands it of the incremental my XXXX this half annualize upside leverage could EPS it operating But EPS, where implied a almost $X but

kicks incremental the supply? really how in like functions with just think do So on plan the I'm to revenue look improving various spending could as on trying margins and what momentum through, you the

Thanks, mechanics. Umer. of There's a financial lot

allocation to think, capital comment to considerations. So effectively I I'll hand Gordon on,

Thanks. question. long XX% range. the a speaking been operating time to and getting to mid- we've for Appreciate high margins Yes, about I Good. mean, the

Zepbound seeing year, and seen point inflection As this at an are taking top end we're so that upwards and ourselves range. Mounjaro we've the of

For the first margins half, little a inflated. are

all lend channels We to haven't our in incretins. and yet promotional of

incretins. You instance, commercials TV for don't see, the in

And given R&D We to haven't R&D, the that looking done at -- scale supply the situation. takes thoughtfully. in time it

quarter-by-quarter with revenue. sync So it exactly doesn't move in always

R&D growth half. expect our the launches the look at year we guidance get half, the you and growth in stronger scale marketing thus the you in the into continue year, first seen X we within quarters' as XX% the to growth that far. the range half, see sales mix, first the And as year part if what to and should second does for we've new full from of upper second the That indicate will said, the also stay to with for growth

see the are on we dynamics those So operating for margin XXXX.

next will Mohit from be The question Bansal Fargo. from Wells

take is Congrats And the it quite there. like about if sales rest well the incretins. in in I so already out launch. for seems the like the XX% XX% early stocking doing on ex-U.S. the world like -- quarter. the is regarding is It or U.S., this My question for Mounjaro of seems

be generation efficacious understand so how both love given I uptake versus So And to incretins your is been there Mounjaro would that these prior drugs? going your for for Zepbound really far? and any different to has ex-U.S. are experience

Yes. OUS on Thanks, for you want to question. Mohit, do for Ilya, the rollout comment Mounjaro?

We've the seen question. the launch for great Mohit, U.S. Thanks, of with the of progress some Mounjaro Sure. outside

you've the terms what launch Saudi, and market drive rest momentum growth. countries, markets U.K., have achieved world, up overall key in share of already and UAE make both seen such and a think as to continue the UAE I in that and of Saudi earlier leading growth are

that with the a earlier the main has we've of in at And and driver been in growth as already of the cycle where of from Pen markets Quick take coming you launched the look majority Mounjaro QX, a lot that UAE. so in presentation in that

look same with our surpassed and is of a brand, already has dynamics to the sales at QX historical any that of a the of markets peak relative the trajectory Some to U.S. if for of that where you limited launched. we've similar At time, take QX number channel

obviously, with expect We'll launch I Germany look already Mounjaro. of capacity launched demand now just and at new expect and we coming Pen to as launched also supply Spain the the so markets coming presentation. The And markets. Quick also from recently predominantly quarters, and in would growth, near-term and we in look also monitor

be Bank Alex will from from Hammond question next The of America.

In a potential When tirzepatide and we indication? the in provide prepared remarks, thinking color could -- pivotal how Dan mentioned engagement with updates? receive you trial about NASH. any these this for regulatory versus on Lilly Can discussions on is authorities

Dan?

Thanks about suffering excited to help the really for patients opportunity Yes. question. from NASH. the We're

quite I II think of effect Phase shared the tirzepatide is the we have. really profound we in data can in that size terms for of appetite

find of drug of issues significant to in most a enroll tackle, There's current probably to the of in consent obviously development mass procedure invasive standard these the difficult of these is to to the measure is which Liver outcome. biopsy risk trials and couple liver trials and that to we're patients identify an trying then there's and patients. also patients biopsy to to course,

as could biomarkers to that to used noninvasive right in potentially identify be We're studies patients develop mass used outcome is a and drug if know to to enroll can working the be hard also working. an

those My could be approval be that hope is that we of kinds and both used biomarkers could accelerated could in future. for drugs or of mass suitable purposes the develop

traditional course, requires long-term Of still demonstration approval for outcomes. Astra of

in to those regulatory in that we'll whether see. as both on could decide we make two that both in We'll decisions these the mass think about mesh. investors updated I invest and So drugs, have we molecules we drugs one to of have drugs depending environment, path keep be or great

Evan Markets. next will Capital Seigerman The be from BMO question from

the specifically, been acquisition Are raised Is do Or to own sale as in given in concerned this on you've still with back Novo February concern able touch your of the what proposed to you you around manufacturing and February? Catalent less to Nordisk. wanted issue? you footprint? as an I Novo of on were by that subsequent the Holdings and

the think It's GLP-X sites production. the Yes, was the about trajectory how it. diabetes of do on of for your ramp, and concerned We situation. our Catalent transaction. your as oddity remain main rely and other more contract manufacturer disclosed, also we ever resolve being take really I I don't can about that it to although that competitor we've of one

are availability for really in capacity across an development of outcome particularly exist, pharma industry There's we ended the an really large sector think, biotech. of managing that medicines, became also out in structure if And would the captive important all issue. constrain, where up they I CDMOs didn't of sector.

proposed transaction we're and concerns and to since the So publicly privately was announced, what those we've see aired waiting happens.

outlook our for as terms company, in we're of have noticed, aggressively But building may ourselves. the long-term you

we it, Our and that's the self-run we that last our can to repeat we're primary there. know in $XX probably of comfortable we've got plan. announced large execute is online, billion sites and not we've done sites. quite newest building the sites drill base as And several years, And strategy begun operating and come

The next be Risinger from question Leerink. Dave will from

results the on well and congrats corporate the my add me Let updates. as

benefits employers persistent with encourage greater employee health patients does time let's need work to benefits from that say, is, There are be therapy, Lilly and breadth drive patients to an Lilly doing to of better productivity to seem Zepbound's worker intend benefits, communicate to as And order health what but employer obesity of is in my articles part many. inclusion of stay benefits? productivity Zepbound's from to therapy? So question or et drugs how cetera. much to time, its just by not off-ramp And underappreciated

comment you do persistency and to on want Patrik, Dave. Thanks, benefits?

Absolutely.

look providers, is a overall, persistency, this when feedback we after the the they patients because on well, we have on from also and to weight at and stay early based I it's implications the think that But benefits the want as patients loss very from drug first experience downstream on comorbidities. -- launch.

our well -- efforts gained value-based increased other the over and We're we interest. tremendously workplace et cetera, OSA, that tirzepatide You're productivity, right, we us that reduced the opt-in has coming years. also more key, the looking employee are extremely data, readout and of having will have in and of are in help several to as now a believe outcome with the lot into payers benefits agreement terms absentees, of where come

for And working and over patients the us. yes, stay and consumer, consumer experience start consumer, then Zepbound improving with digital to a channels on that also enable the we're the ease really to provides of priority to benefits time. platforms terms In key is our

question next Berenberg. The Holford be will from from Kerry

Just coming to expense another earlier, the back in given XXXX... question margin the

Apologies team.

okay that's on if line next from the question, in from the Kerry better Sachs. reconnected momentarily. Chris meantime, with And We Shibutani Goldman will we'll get to a move

I oral different kind do you seems opportunities on for be? loss, competition the weight a orals, as we the there mechanisms And while you for think basis basis particular, injectables. into really from can the as yourselves thinking variations has us your to on on as what a of of been really what it percent going profiles But of matter. move on particularly all in as comparison well With envision? competitors, the is update tolerability if it now

how do recommend do how you it? interpreting and other oral think development? we products about these different, differentiating about if you get are investors Even mechanisms So data? how thinking the And compare smarter are in datasets we when across

chime in? you to want Dan,

are actually all, Yes. to the the I'll differentiation. anything of There's But I'm GLP-X drugs start, take and in I some caution seen then I Phase Patrik Most see we'll to first aren't clinical different think on before, of Thanks. commercial as small we've the saying trials. more agonists. that add on short trials, to mechanisms that just see.

don't to terms I this differentiation in weight In be there loss. class, expect efficacy, of

population. desired the different match efficacy reasonable escalation much the is want faster you You have. loss depending it ramp higher doses, aggressively of on have in and dial that less some to their tolerability how tolerability. comes Then issue with the companies usually Tolerability you efficacy. another the dose can you to the to work what The amount along through weight you of pretty own with dosing

of The things molecule. together half-life links often those two is the that variable the

of So that's the bigger shorter peak drug. trough -- tolerability drives And pharmacokinetics half-life molecules the think in we issues. will give you the that -- what

that smoothly. want So a dose what can half-life molecule more is long be you escalated

anything differentiation efficacy. So talking than the of about in currently terms will are rather be companies that probably that

Phase before, orforglipron III some to road with long attrition. from like expect we can a data have As early we and I clinical it's said trials

pretty excited next-generation I'm also about molecule.

of and of range the offer these been about will sort ones of we've in efficacy All semaglutide. that are GLP-Xs injectable now talking

tolerability we'd orals on are does I that efficacy certainly could like for multiple like also we working and that tirzepatide exceeds that think GIP-X, agonize ultimately, that example. and see drugs to could combine incretins offer that things

us. future the and there progress on in exciting more that So come for to

is the the Just from drivers both and tolerability. market conducting provider we're oral And when actually a loss it's And beyond and efficacy. research. regularly consumer the that, need injectable-like commercial needs point the looking we safety into an of with we an still and oral, preferences, weight true at the of degree are of an view, today look and when

that's to today So comes we're currently and particularly that probably serving a serve those injections. what beyond of patients the new that have fear

compensation the I look we all over looking are be think I comes aspects, weight And beyond think of what that we fats When at into loss, of those and mass would lean aspects versus durability. well. as

running know time. short we're on I

of best So to our possible. get many as answers compress kind as we'll do through our questions we as

have Kerry we Holford And from Bernberg reconnected.

can you Hopefully, this hear me better around. time

Much better.

Lovely. was on My margins. question

to your year the can higher expecting Zepbound operating are this expect we achievable? where that after Is in the now high plan? range in to land given landing XXs mid-XX%, launches, the midterm perhaps margin So -- mid- -- margin you

I previously sustainable I Dave, from on that if far, above so not margin your operating progress you innovation-focused you've know company. an that. changed an XX% your view suggested But And wonder is given

briefly? Gordon, that do on to you want touch

the appreciate question. I Kerry. Thanks, do. Will Yes.

the revenue. here. said, half, lot we inflection play the to as But see on inflated in expect we dance, range we had at XXs as position. I think There's do earlier, I like Yes, on said first line, end this still year. that an you've a points upper through top

R&D, going be that's that, starting to with in in scale do haven't a not half. intend and That's of line going exactly the And lean promotional revenue. to yet to in we our that quarter-by-quarter We dynamic leaned channels. to second we any more

those of things are to all through. So still play going

I this picture there. about 'XX, we're point, at And do about guidance said, for think the we chat just XXXX. longer-term talking when we'll that

Tewari Akash from The Jefferies. next question will be from

loss? versus potential lean are GLP So we're starting the XX% versus way it looks mass. be terms XX% absolute loss, where a not [ to in for kind muscle -- Can muscle combos weight the talk ] may combo preserve that to the to about -- quality see preservation? you particular, that where Zepbound loss. show of could think like Amlin And next-gen showing world level could you Aloralintide fit what fat also of -- show weight would maybe but In that muscle only both of of in triplet then

question focus can oral on about first Dan that [indiscernible].

multiple maybe have in play we here, mechanisms starting with the amylin. So

molecule clip. agonist, Aloralintide, in II a and is called GLP evaluating tirzepatide combination and with as we're AML have both which that We Phase monotherapy a pure

loss cricalutide have see. investigated to most terms Novo have will people mass the that scientists I combination in data semaglutide. notions with of at with don't about versus lean the that So that about what strong be be combination. fat would preconceived particular to in who a ] [ expect Probably since the interesting they've

which in brings the and us is biomass a DACRA like crugilatide we that and which dual which another and is we composition in that will a calcitonin think have I agonism, I called we'll also evaluate it. molecule one agonist, dual probably Phase mechanism, probably that to of investigate amylin be of aspects

to finally, family, in II this of -- semaglutide. that's trial acquired then share we bimagrumab we a in data in in having and you antibiotic the that a we with combination with is And from which have Phase that talk And myostatin, the forward an proceeding future. molecule look to that's and Versatis,

weight mass that loss that of we've out tirzepatide. of with effects disadvantages any get All far, I so not variable composition. the mechanisms, seen types I body these think, on to have could point we

heart things, demonstrated. show failures patients a functional variety outcomes fruit fact, we just improved including In function on of and

have of question trials these makes So could the we improvements of That's ratio to more mass? with higher fat even lean further

from will question UBS. next be The from Trung Huynh

on Just question from GLP-X. previous following the ex-U.S. on

ex-U.S. an on reimbursement how sales countries? obesity Mounjaro us to percentage countries? of of million. saw And XXX ex-U.S. you is give out-of-pocket color $XXX jumped $XXX You million this diabetes? some sales And these more from what is versus with bigger in going this million the drug quarter is the Can

good don't on of that. Okay. On we'll answer I a second think one, that much probably give

weigh that is So around on I'll maybe going. ex-U.S. just ask how in question Ilya to reimbursement first

as progressing out-of-pocket the course, reimbursed well the in both of nicely think momentum I as is Well, segments. Sure. overall the quite

the achieved in We reimbursement U.K. have

we've we're and expand markets reimbursement for in have Germany, to other in reimbursement that continuing reimbursement We look launched. and

momentum We have X out-of-pocket that some reimbursement to in in both that expand Saudi both that we of expansion is segment, progress well and both share markets been that we're the in chronically we've in covering X and in But and on and the market well we the a will as in. in And UAE enter. type diabetes. continue as market the as Type the seeing management reimbursed markets in lot

up. Thanks, the Paul, lot I wrap Maybe Ilya. know two more we a have then just in questions things have queue. and we

question The TD Scala is coming next from Cowen. Steve from

and definition this the shortage case, assume FDA that quite seems is FDA's definition definition meeting demand. clear black but to that's I and say is in seems tirzepatide least is I will shortage meeting you of the assume white imply the longer no Lilly of The determination. at not clear.

like? demand is FDA's met? being does look How So conclusion? is does Lilly demand with And How being measured? agree demand what

question. important the for Thanks Yes.

question compounding think is well. As the as important about we

said we've is, versus orders the available dosage As receive as in we're we're earlier, we know, in forms means that U.S. they you all fill doing. can What as what

on probably XX economically mean pharmacy That's and does every any that not a of all them has dosage logistically. shelf. or That pharmacy infeasible forms their certainly even lot for sitting

patients So going few I It's an told because abundance counters days to being pharmacy orders there's wait of of to to fulfillment see think and not while a more real-time situation, their supply. filled. continue a we'll

We're see quarter. these at and pretty results and it, part a flowing is flowing that rate. it's can in product high But of shipping you from the

that to as increase demand will will add files but So picture, well.

that the be end experience to So the well situation. to continue we're We given I doing think But the FDA. point choppy. pharmacy will out

the I So people wanted say, want and applies definition moment that call the think that on couldn't I get I may the That's I not it at means here. pharmacy what to. we choose

channel partners our responsibility clear try with along to to theirs. experience, the and agency the continue the and confusion consumer with which to we'll up improve is So

today will from be Louise from Chen Last Cantor. question

and about are see obesity muscle excited need? wanted true drugs unmet a I these as how ask preserving if to you you that you

Thanks. to on? add anything Dan,

No, thanks question, Lisa. Yes. the for

area interesting will an it's soon think kinds mechanisms benefits to sure. patients. exactly of these know science I translate for Too for how of into

than, At metabolic in the as is lean an BMI. a know ratio metabolic health important probably high mass mass that overall indicator health, really fat of we to example, level, determining important for more of

health fat wait increase ] data And mass translates what these spurs wait lean benefits [ while mass to to for own our see nimagrimab efforts so that's that of and loss causing patients. from how kinds into we'll see to and

Great.

closing So wrap remarks. I Dave, think we'll up.

participation everyone. Have in Thanks, you interest call today's we Joe, are your and here. thanks to the Investor earnings with Eli Please if there's few and your Great. sounds those. address, Relations a in answer all Happy great team follow any Lilly like team We of and and appreciate that questions Company. day, holding. have the it didn't to up a

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