Eli Lilly raises annual profit forecast on strength of diabetes drug

(Reuters) -Eli Lilly and Co on Thursday raised its annual revenue and profit forecasts after topping first-quarter sales estimates on demand for its closely watched diabetes drug Mounjaro, ahead of a decision on its use as a treatment for obesity.

The company separately said it planned to complete rolling submission to the U.S. Food and Drug Administration for use of the drug, commonly known as tirzepatide, in obesity patients in the coming weeks, following positive data from a second late-stage study.

Data from the study showed that a high dose helped people with type 2 diabetes who were also obese or overweight to lose nearly 16% of their body weight.

Lilly said it expects regulatory action for use of the drug in obesity as early as late 2023. 

Shares of the U.S. drugmaker rose nearly 3% before the bell.

Lilly has been leaning on Mounjaro, approved last May for diabetes, to soften the hit to sales from price cuts for its insulin products and competition for cancer therapy Alimta.

Investors are focused on demand and reimbursement for the potentially blockbuster drug, which clocked sales of $568.5 million for the quarter, compared with estimates of $422.5 million.

Lilly now expects adjusted 2023 earnings of $8.65 to $8.85 per share, compared with its prior forecast of $8.35 to $8.55. Analysts were expecting an annual profit of $8.45 per share, according to Refinitiv estimates.

The company also raised its annual revenue forecast to a range of $31.2 billion to $31.7 billion, compared with its prior range of $30.3 billion to $30.8 billion.

Excluding items, Lilly earned $1.62 per share in the quarter ended March 31, missing expectations of $1.73.

The company reported overall revenue of $6.96 billion, topping estimates of $6.86 billion.