Lilly seeks court ruling that could mean big money for new weight-loss drug

Eli Lilly and Co. wants a federal court to uphold a simple math equation: 41 is greater than 40.

The Indianapolis-based drugmaker filed a lawsuit in federal court this month, challenging the U.S. Food and Drug Administration’s ruling that the company’s experimental obesity treatment, called retatrutide, does not contain more than 40 amino acids and is therefore not a protein.

Lilly wants a court to find that retatrutide, which is in late-stage clinical trials, contains 41 amino acids and is therefore a protein. It wants the court to overturn a decision in March by the FDA, which rejected Lilly’s request to designate retatrutide as a biological product and instead classified it as a drug.

What’s the difference? If Lilly can get a federal court to rule that retatrutide is a biological product, the treatment could get 12 years of market exclusivity instead of five years given to drugs under the law, according to Pink Sheet, an industry newsletter.

“But perhaps more importantly, because patents could last longer than exclusivity, retatrutide as a biologic could have an easier time staving off lower-price biosimilars than as a drug fending off generics, due in part to differences in patent disclosure rules,” Pink Sheet said.

In addition, retatrutide would also have a longer period of unrestricted pricing in Medicare as a biologic than as a small-molecule drug. Under the Inflation Reduction Act, biologics could be subject to Medicare-negotiated prices 13 years after approval, compared to nine years for small-molecule agents, the newsletter said.

So getting back to that math equation: Lilly’s complaint spends the bulk of 30 pages stating that retatrutide consists of 41 amino acids.

Federal regulations state that a product qualifies as a protein, and hence a biological product, if it is an alpha amino acid polymer, has a specific, defined sequence, and is greater than 40 amino acids in size, counting the “total number of amino acids.”

“That aptly describes retatrutide, which is an alpha amino acid-containing polymer with a specific, defined sequence of 41 amino acids—40 alpha amino acids and one other, non-alpha amino acid—that are associated with one another in a manner that occurs in nature,” the drugmaker’s complaint said.

But the FDA determined that retatrutide does not satisfy the third requirement on the grounds that it is not greater than 40 amino acids in size.

“But 41 is plainly greater than 40,” Lilly retorted in its complaint.

The difference could mean tens of millions of dollars to Lilly—and to patients and the Medicare system. Lilly is positioning retatrutide as its next blockbuster obesity treatment—and to help patients manage other chronic problems, such as sleep apnea, knee pain and type 2 diabetes.

Injected weekly, retatrutide work through a biological mode of action, targeting multiple receptors in the body to suppress appetite and increase energy, Lilly says. The product is still in Phase 3 clinical trials and won’t be up for FDA approval for more than a year.

Lilly CEO David Ricks told the Wall Street Journal in June that retatrutide “has a strong effect on visceral fat and liver obesity and other really difficult-to-treat types of obesity.”

“As a result, you lose even more weight than [with] tirzepatide,” he said.

That’s a big claim. Tirzepatide is the generic name for the active ingredient found in Lilly’s two recent blockbusters: diabetes treatment Mounjaro and obesity treatment Zepbound.  In recent months, demand for both drugs have overwhelmed Lilly, prompting it to invest billions of dollars in additional manufacturing capacity in Indiana, Germany, Ireland and other sites.

The case was assigned to Judge Tanya Walton Pratt and Magistrate Kellie Barr.