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In the field of innovative drugs that must talk about FICs, Lilly may be an alternative
.
It has always been a follower: FIC products are extremely rare in its pipeline, mostly "me better" products
.
But for now, this strategy is working well
.
Today, with a market capitalization of $312.
6 billion, Eli Lilly ranks second among all pharmaceutical companies in the world, perhaps as it should be
.
Before it, Johnson & Johnson was not a pure pharmaceutical company in a sense, because the device sector contributed a large proportion of the valuation
.
Lilly's success is essentially a triumph
of pragmatism.
Although people are more obsessed with the success of FIC drugs from 0, the plot of life hanging by a thread and nine deaths is more in line with people's understanding
of the difficulty of innovative drug research and development.
However, Lilly's growth trajectory shows another version of the story of innovative pharmaceutical companies: rational, pragmatic and efficient
.
Lilly's success is hard to replicate, but it is not without inspiration:
If you want to go further in the arena of innovative drugs, you need to be clear about your advantages and possible costs, and then find the most reasonable route and execute to the extreme
.
/ 01 /
/ 01 /Best performing pharmaceutical stocks over the past four years
Best performing pharmaceutical stocks over the past four years Who has been the best big pharma company in the past four years? Is Johnson & Johnson, the first drug in the world in terms of annual revenue? Or Pfizer, which has both the covid vaccine and the oral medicine? Neither
.
The answer is, Eli Lilly
.
Since 2019, in less than four years, Lilly's share price has risen by 184.
56%, and its market value has increased by more than $200 billion to $312.
6 billion
.
What is the concept of $200 billion? Let's put it this way, Hengrui Pharmaceutical, as the big brother of domestic innovative drugs, has a market value of only 255 billion yuan, or about 35 billion US dollars
.
200 billion US dollars, enough to buy 6 Hengrui
.
Even among the many multinational pharmaceutical companies overseas, only two
companies, Johnson & Johnson and Eli Lilly, have a market value of more than $300 billion.
However, according to seniority, whether in terms of revenue scale or growth rate, it is not Lilly's turn to stand behind
Johnson & Johnson.
So, what do investors really like about Lilly?
The answer to the question needs to be found in Lilly's financial reports
According to Eli Lilly's semi-annual report, the drugs that currently promote the company's performance growth are mainly dulaglutide, eqizumab, abeccilib, and empagliflozin baricitinib
.
In the first half of 2022, Lilly's total revenue was US$14.
298 billion, of which these five products combined for US$7.
126 billion, accounting for 50%
of Lilly's total revenue.
It is these products that have laid the foundation
for the steady growth of Lilly's performance.
To determine the value of pharmaceutical companies, in addition to the current performance, it also depends on the
future growth of pharmaceutical companies.
Judging from the performance of investors, it is inevitable to think that the future of Lilly is still worth looking forward to
.
/ 02 /
/ 02 /Lilly's present and future
Lilly's present and future Indeed
.
It seems that Lilly's existing five pillar products still have some room for
growth.
Let's start with the GLP-1 receptor agonist dulaglutide
.
As a powerful hypoglycemic drug, dulaglutide is Lilly's trump product, with sales of $3.
653 billion in
the first half of the year.
The growth of the diabetes market is not yet in sight, and the potential of GLP-1 receptor agonists also includes a more attractive weight loss market
.
From only two points of view, the future of dulaglutide still has a lot of imagination
.
Let's look at the IL-17A inhibitor ichizumab
.
With sales of US$1.
09 billion in the first half of the year, it is the second pillar product
of Eli Lilly.
As one of the core products in the field of self-immunity, the biggest focus of ichizumab is to expand the indications, including psoriasis, psoriatic arthritis and ankylosing spondylitis
.
At present, Eli Lilly is constantly expanding its indications, so the growth of ichizumab seems to have not come to an
end.
Next, look at the SGLT-2 inhibitor empagliflozin
.
With first-half sales of $800 million, Empradizin is Lilly's third pillar product
.
As a hypoglycemic drug, empagliflozin's imagination is more than diabetes
.
Previously, the FDA has approved empagliflozin for the treatment of type 2 diabetes and heart failure
.
In March this year, the Phase III clinical trial of empagliflozin in the treatment of chronic kidney disease reached its endpoint, which means that empagliflozin will soon gain another major indication
.
With three indications in hand, the upper limit of SGLT-2 inhibitors may not be too low
.
Then look at the CDK4/6 inhibitor abecilib
.
Abeseli's first-half revenue was $1.
058 billion, an increase of 73%.
Clinically, abeclib can still exert efficacy in patients resistant to pibociclib, and is the only CDK4/6 inhibitor that can be used for adjuvant therapy for early breast cancer, which has a significant competitive advantage
.
Abeseli's growth may not be over
either.
Finally, let's look at the JAK inhibitor baricitinib
.
Baricitinib had first-half sales of $442 million
.
Although compared to last year, the growth rate of baricitinib has declined
.
However, with the approval of this new indication for alopecia areata, the future market potential of baricitinib is huge
.
In addition to the approved products, there are still many potential players
in Lilly's pipeline.
As shown in the chart above, Lilly has a number of products in the late clinical stage
.
Among them, the most concerned is the GIP/GLP-1 blockbuster hypoglycemic / weight loss drug tirzepatide
.
UBS analysts are expecting peak Tirzepatide sales of $25 billion
.
Today's drug king Humira sales peak is just over $20 billion, if it can meet the analyst goal, Tirzepatide undoubtedly has the potential to
become the next drug king.
Secondly, there is the Alzheimer's drug Donanemab
.
On September 27, the second Alzheimer's disease drug lecanemab from Biogen/Eisai was successfully clinically successful, which made the heat in the field of Alzheimer's disease rise again; Lilly's drug Donanemab for the same target has multiplied
its hopes of success.
Evaluate Pharma predicts that Donanemab's sales have soared to $3.
1 billion
in 2026.
With steady growth in existing products and two potentially blockbuster drugs in hand, it's no wonder investors are confident
in Eli Lilly.
/ 03 /
/ 03 /The strongest king in the field of Me better
The strongest king in the field of Me better Although Lilly's pipeline has a lot to see, one thing we can find is that the main force in Lilly's pipeline is me better drugs, and FIC drugs are extremely rare
.
For example, the GLP-1 agonist dulaglutide is only a follower
in the GLP-1 agonist field.
As early as 2009, Novo Nordisk's GLP-1 agonist liraglutide was approved for marketing, becoming the world's first once-daily GLP-1 drug
.
Lilly's GLP-1 drug was approved five years late, in 2014
.
However, although it failed to take the first-mover advantage, Lilly's GLP-1 agonist can be administered once a
week.
With the advantage of medication time, dulaglutide is the last to come, and officially became the sales champion
in the GLP-1 field in 2020.
Lilly's Abeseli is also a masterpiece
of me better drug corner overtaking.
Abecilil is the third CDK4/6 inhibitor approved for marketing in the world, after Pfizer and Novartis products have been approved for marketing
.
Although not dominant in terms of schedule, Abécigli achieved corner overtaking through the optimization of the structure
.
Pfizer and Novartis' CDK4/6 inhibitors, due to neutrophil toxicity, had to stop taking the drug for three weeks and one week of dosing
.
Lilly's abeseli solves the problem of blood toxicity through differentiated structural design, can be administered uninterrupted, and has the advantage
of compliance.
Because the time-to-market disadvantage is too obvious, Abécili's sales are difficult to match Pfizer
.
But in 2021, abeclib surpassed Novartis' CDK4/6 inhibitor, rebocilib,
with $1.
35 billion in revenue.
Dulaglutide and abecilil are not isolated
cases.
As shown in the figure below, most of Lilly's SGLT-2 inhibitors, IL-17A monoclonal antibodies, JAK inhibitors and other products are not the world's first innovative drugs
.
But even so, Lilly managed to get a piece of the pie
by making some structural improvements to the drug.
/ 04 /
/ 04 /A triumph of pragmatism
A triumph of pragmatism Lilly's success does not mean that every pharmaceutical company can replicate it
.
The reason why Lilly can rely on me better drugs to achieve strong performance growth, in addition to the advantages of effect, is also a key reason is that it has strong sales capabilities
.
Don't forget, Eli Lilly is one of
the oldest big pharma companies in the world.
It can be said that it is with the double blessing of effect and sales that Lilly has achieved amazing success
.
However, while the pattern may not be successfully replicated, it is still worth learning
.
In essence, Lilly's growth was a triumph
of pragmatism.
Specifically, Lilly's pragmatism is twofold
.
On the one hand, in terms of mergers and acquisitions of pharmaceutical companies, Lilly is frugal and keeps the household, and rarely buys large amounts of money
.
Lilly's vice president has said that Lilly will choose the most suitable deal
in terms of acquisitions.
It is also for this reason that it is not difficult to find that unlike big pharmaceutical companies such as Pfizer and Merck, which often spend a lot of money to acquire pharmaceutical companies, in the M&A market, Lilly does not have many
large-scale transactions.
On the other hand, in terms of innovative drug research and development, Lilly also takes less risk to follow up some FIC targets, and more quickly follows up the development of me better drugs
after the target is relatively mature.
It is also because of the pragmatic strategy that Lilly's drug research and development efficiency is much higher than that of its peers
.
At the 2021 Eli Lilly investor conference, Lilly said that its drug development efficiency is much higher than the average
of the pharmaceutical industry.
To put it bluntly, as a big pharmaceutical company, Lilly fully knows its strengths and takes them to the extreme
.
For a pharmaceutical company, this is enough
.
Back in China, many pharmaceutical companies aspire to become Bigpharma and develop FIC products
.
Although behind the emergence of these phenomena, there is
a background of the times.
But it is clear that only a small number
of pharmaceutical companies are destined to achieve their ambitious goals.
Nowadays, as the tide recedes, many pharmaceutical companies should also sink their hearts and think about their core strengths, or what the circle of competence is
.
Then find the most reasonable development route and execute it to the extreme
.
