Why Lilly Shares Are Moving Thursday

Eli Lilly and Company LLY shares are advancing solidly Thursday following an update the company provided on its Alzheimer's program.

What Happened: Lilly, which is developing donanemab as an investigational antibody therapy for Alzheimer's disease, said the Food and Drug Administration granted breakthrough therapy designation for the therapy.

More importantly, the company said it intends to submit a biologic license application with the FDA for donanemab under the accelerated approval pathway later this year.

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Why It's Important: The decision to seek accelerated approval comes as a surprise as the company hinted in April it doesn't think it could apply for approval of donanemab under the accelerated approval pathway.

Lilly's decision may have been prompted by FDA's recent decision to approve Biogen's controversial Alzheimer's drug Aduhelm despite the not-so-clean data package to support approval. Since Aduhelm's approval is conditional, Biogen has to prove its efficacy and safety with a confirmatory trial, while it is on the market.

Both Aduhelm and donanemab has a similar mechanism of action of targeting the amyloid plaques.

The breakthrough designation accorded to donanemab will support expedited development and review of the drug.

Donanemab is currently being evaluated in a Phase 2 trial, dubbed TRAILBLAZER-ALZ, to assess its efficacy and safety in patients with early, symptomatic Alzheimer's disease.

At last check, Lilly shares were rallying 9.47% to $237.65.