Lilly reports surging profit, raises full-year guidance

Eli Lilly and Co. announced second-quarter profit Tuesday morning of $1.76 billion, up 85% over the same quarter of 2022, driven by strong sales of leading drugs for diabetes, cancer and other diseases.

The company also raised its full-year guidance for earnings per share. Lilly shares surged 9.2% in premarket trading into record territory of $495.80.

Revenue climbed 28%, to $8.3 billion, higher than Wall Street estimates of $7.6 billion. Earnings per share, adjusted for one-time events, were $2.11, higher than estimates of $1.98 a share.

The Indianapolis-based pharmaceutical company said sales of several leading drugs swelled in the quarter, including cancer drug Verzenio (up 57%), diabetes drug Jardiance (up 45%) and psoriasis drug Taltz (up 16%).

Lilly’s hottest new product, diabetes drug Mounjaro, rang up $979.7 million in the quarter, placing it firmly in blockbuster territory (drugs that sell $1 billion or more in a year). For the first six months of this year, Mounjaro has sold $1.55 billion.

The drug, which has shown promise as a weight-loss drug, is selling faster than Lilly and outside vendors can make it, creating delays in fulfilling orders, the company said. Mounjaro launched in June 2022. Federal regulators are expected to approve it to treat obesity this year.

“Lilly’s financial results in Q2 were led by Mounjaro sales and a strong performance from growth products,” said CEO David Ricks said in written remarks.

Research and development expenses increased 32%, to $2.36 billion, or 28% of revenue, primarily driven by higher development expenses for late-stage assets and additional investments in early-stage research.

Marketing, selling and administrative expenses increased 18%, to $1.93 billion, primarily driven by costs associated with launches of new products and indications.

Sales of several older or discontinued products fell in the quarter, including cancer drug Alimta (down 73%), diabetes drug Humalog (down 1%) and COVID-19 antibodies (down 100%). The company sold the rights to diabetes treatment Baqsimi to Amphastar Pharmaceuticals, which brought in $579 million in the second quarter.

Lilly increased its full-year revenue guidance by $2.2 billion, to the range of $33.4 billion to $33.9 billion. It increased its earnings-per-share guidance to the range of $9.20 to $9.40 on a reported basis and $9.70 to $9.90 on an adjusted basis.