According to the Food and Drug Administration (FDA), something exciting happened today. Pharmaceutical stock Eli Lilly’s (LLY) weight loss drug Zepbound is no longer in shortage as of today. But that news did not sit well with investors, as shares were down nearly 1.5% in Thursday afternoon’s trading.
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With this pronouncement, compounding pharmacies will lose the ability to make their own unbranded versions of tirzepatide, the active ingredient in Zepbound. However, those pharmacies will have some time to continue, as there will be a window of between 60 and 90 days to stop making the drug, noted a CNBC report.
The FDA ultimately determined that the shortage is now “resolved,” and that pulls the rug out from under the compounding pharmacies. Meanwhile, the pharmacies in question are crying foul, noting that the price tag on Zepbound is $1,000 a month, a price that many cannot resolve in their budgets. The And with many insurance companies not including Zepbound in their drug coverage—the anti-diabetes treatment Mounjaro, however, is—the compounding pharmacies are urging some kind of accommodation be made.
More than Mounjaro
While this by itself should have been good news, there was more positive news for Eli Lilly today. Its Kisunla treatment for early-stage Alzheimer’s disease has just been approved for use in China. That brings the total of markets that will allow the treatment up to four, including the United States, the United Kingdom and Japan.
Kisunla, noted a Reuters report, works by removing beta-amyloid, a kind of plaque related to Alzheimer’s, from the brain. It was found to slow issues in Alzheimer’s patients by 29% against a placebo, though it did come with a significant side effect: potential brain swelling. The good news there, though, is that by starting on mild doses and working your way up, the percentage of patients who have the most serious brain swelling is reduced.
Is Eli Lilly a Buy,Hold or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on LLY stock based on 16 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 33.04% rally in its share price over the past year, the average LLY price target of $1,045 per share implies 38.51% upside potential.
