Eli Lilly CEO David Ricks is confident his company and peer Novo Nordisk are years ahead in the weight loss space, as biotechs press on with compelling data.
Eli Lilly’s CEO David Ricks appeared unfazed by the seemingly competitive weight loss data put forth by multiple biotech companies in August, easily brushing off concerns on an early August second quarter earnings call. His responses to analysts underscored the challenges these small companies have to rival the obesity market juggernauts.
“You’re talking about making things on the $1 billion scale, which takes time, and it’s technically difficult and very capital intensive. So of course competitors will come. But there’s a road ahead for all these that the two leading companies have already walked in large part,” Ricks said of Lilly and the company’s peer, Novo Nordisk.
Ricks was asked by an analyst for his thoughts on emerging earlier-stage competitors in the obesity market and what barriers these companies may face. He was also asked how Lilly might defend its market position over time. The earnings call came amid a summer of competitive trial results, with more to come long after the investor call ended. Metsera, Terns Pharmaceuticals and Viking Therapeutics have all been making their mark on the clinic in recent quarters.
Even so, Ricks’ confidence is supported by the numbers. Lilly launched Zepbound (tirzepatifde) in weight loss in the second half of last year and clocked $1.2 billion in sales for the second quarter, and Ricks highlighted Lilly’s expansive clinical program designed to bolster the company’s portfolio and expand existing products into additional patient populations. Lilly has 11 assets across different targets in weight loss, with thousands of patients enrolled in ongoing trials.
Ricks also spoke to Lilly’s massive head start over most companies in the weight loss space. The first Phase I data for tirzepatifde, which in addition to Zepbound for weight loss is marketed as Mounjaro for diabetes, were recorded in 2016.
“That’s a massive lead, I think, over other GIP/GLP agonists that are behind us,” Ricks said on the earnings call.
Daniel Skovronsky, chief scientific officer and president of Lilly Research Laboratories, added that the company has the scale to invest heavily in Phase III programs, running multiple high-profile trials for several indications and populations at once. He noted that investors get excited when they see early Phase I data for other candidates but it’s the Phase III data that secures FDA approvals, and no one can rival Lilly there.
“It’s still a challenging space to develop drugs and we usually wait until we’ve seen pretty robust Phase II data before we get too excited about a particular molecule,” he said. And when it comes to Phase II data for the weight loss drugs now in Phase I, “I wouldn’t be expecting 100% success here.”
Lilly is also working aggressively to develop an oral medication for weight loss, which would allow patients an easier to administer option. The company’s orforglipron oral therapy began a Phase III trial earlier in the spring, putting it well ahead of biotech entries like Viking’s tablet formulation of VK2735, which is set to enter a Phase IIb test in the fourth quarter. Structure Therapeutics and Terns are also working toward Phase II trials for their oral options.
But where Lilly and Novo really have the fire power is in manufacturing. Ricks predicted that obesity “probably will end up being one of the highest volume categories in the history of the industry.” The manufacturing challenge has required billions in investments to be able to make enough to meet demand.
Lilly’s Patrik Jonsson, president of Lilly Cardiometabolic Health and Lilly USA, summed it up: “All hands on deck on our side.”
But seemingly undaunted by the challenge, small biotechs are going all-in anyway. They may not have the scale, with the current clinical patient populations numbering in the hundreds for each individual study, but they have put up data on weight loss percentage and safety to rival the market leaders.
Brand new biotech Metsera just this month released competitive results showing 7.5% weight loss for an early-stage candidate called MET-097, with few side effects and no titration period. Terns keeps churning out positive update after positive update. Viking, long a subject of M&A chatter, is continuing to sail alone with a strong collection of obesity candidates, including a Phase III program slated to come together by the end of this year.
