(Adds analyst comment, details on Trulicity, Taltz)
Oct 23 (Reuters) - Eli Lilly and Co'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.
(Reporting by Manas Mishra and Saumya Sibi Joseph in Bengaluru; Editing by Arun Koyyur)