This Analyst Sees Potential Downside In Eli Lilly, Adjusts Model For Acquired IPR&D Charges

Cantor Fitzgerald analyst Louise Chen reiterated an Overweight rating on the shares of Eli Lilly And Co LLY and maintained a price target of $885.

The company is slated to report its second-quarter FY24 earnings on August 8.

The analyst highlighted that Eli Lilly’s GAAP and non-GAAP financial results for 2Q24 will include acquired IPR&D charges of ~$154 million on a pre-tax basis, representing a charge of ~$0.14 to both GAAP and non-GAAP earnings per share. 

The following are some of the points the analyst lists that are important for the company’s growth in the coming days.

The analyst expects U.S. approval for Lebrikizumab to treat atopic dermatitis in 2H24E.

Also Read: Eli Lilly Announces CFO Change

The analyst also expects Morphic acquisition to close in 3Q24. Morphic’s lead program is a selective oral small molecule inhibitor of α4β7 integrin for the treatment of IBD.

By the end of 2024, LLY expects to have results of SURMOUNT-5 which is its H2H study of tirzepatide vs. high-dose semaglutide in participants with obesity, said the analyst.

The analyst sees the first set of Phase 3 results on orforglipron in T2D/obesity in 2025, from Phase 3 ACHIEVE T2D program.

LLY submitted tirzepatide for the treatment of moderate-to-severe OSA and obesity to the U.S. FDA with regulatory action anticipated as early as the end of this year, said the analyst.

Key competitive readouts that the analyst looks forward to include, Novo Nordisk A/S’s NVO semaglutide in MASH, Akero Therapeutics Inc’s AKRO efruxifermin (FGF21 analog) in MASH and Novo Nordisk’s CagriSema Phase 3 program for obesity.

Read Next:

• Eli Lilly’s $3.2B Morphic Deal Is ‘Crucial,’ Has ‘Strategic Merit’ Despite Investor Attention On Obesity: Analyst

Price Action: LLY shares are trading higher by 0.475 at $952.82 at last check Monday.

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