Biotech and Pharma

Eli Lilly misses sales estimates as top-seller Trulicity disappoints

Key Points
  • Eli Lilly raised its 2019 profit forecast. The drugmaker now expects 2019 adjusted earnings per share to be in the range of $5.75 to $5.85, up from the prior range of $5.67 to $5.77.
  • The pharmaceutical company also reported a better-than-expected quarterly profit.
  • Results were helped by the performance of its diabetes drug, Humalog, and lower tax bill.
An Eli Lilly & Co. logo is seen on the cap of a pill bottle in this arranged photograph at a pharmacy in Princeton, Illinois.
Daniel Acker | Bloomberg | Getty Images

Eli Lilly's quarterly sales missed Wall Street estimates on Wednesday as the drugmaker offered more discounts or rebates for its top-selling diabetes drug Trulicity, sending shares down 3%.

Lilly has been banking on its newer drugs such as Trulicity and psoriasis therapy Taltz as it bears the brunt of increased generic competition for older drugs such as erectile dysfunction treatment, Cialis.

Demand for Trulicity remained strong in the third quarter, but its overall sales were hit by lower realized prices due to higher rebates or discounts that drugmakers pay to middlemen such as pharmacy benefit managers.

Citi analyst Andrew Baum said Trulicity sales were likely a result of Lilly trying to defend its market share against the upcoming launch of a rival drug from Novo Nordisk A/S .

Sales of Taltz, which was also hit by rebates, rose nearly 29% to $340 million, but missed analysts' expectation of $395.7 million.

The company said prices in the United States were also hurt by higher funding needs for Medicare Part D, a part of the government program for older Americans related to prescription drugs.

Revenue in the United States was flat at $3.06 billion, despite a 5% rise in the number of drugs sold, the company said.

Sales of Trulicity rose 24% to $1.01 billion, but missed the analysts' average estimate of $1.08 billion, according to three analysts polled by Refinitiv.

As a result, overall revenue rose 3.2% to $5.48 billion, just shy of expectation of $5.50 billion.

However, the company raised its 2019 adjusted earnings per share to be in the range $5.75 to $5.85, from the prior range of $5.67 to $5.77.

Lilly's quarterly profit beat estimates, largely due to lower tax bill. Excluding items, it earned $1.48 per share, beating estimates of $1.41, according to IBES data from Refinitiv.

Read Eli Lilly's earnings release here.

Next Article
Key Points
  • In the earnings report, the aerospace giant says it expects regulatory approval of the 737 MAX return to service in the fourth quarter of 2019.
  • "No incremental negative news on MAX will be a relief for most," Credit Suisse says of the results.
  • No U.S. airline expects the jets to return to service before next year, making Boeing's timeline the most optimistic.
  • Boeing also says it expects to "gradually increase" the 737 Max production rate to 57 per month by the end of next year.