Eli Lilly and Co at Leerink Partners Global Healthcare Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: David Risinger - Leerink Partners - Analyst : And I guess to kick us off, it would be great, Lucas, to hear your perspective on the revenue guidance for this year. So we'll get right into it, since you're the CFO, on the numbers. So the guidance is $58 billion to $61 billion in revenue. Hoping you could discuss the factors that could drive performance towards the top end of the range and on the flip side towards the bottom end of the range.

Question: David Risinger - Leerink Partners - Analyst : Excellent. Maybe you could expand a little bit more on just the expansion of capacity. There was an additional facility in North Carolina that I think opened recently. But how would you contextualize that volume expansion that you're going to be benefiting from over time?

Question: David Risinger - Leerink Partners - Analyst : Yes. That's super impressive. But actually now that you mentioned it, so you said $27 billion, 3 API sites and one parenteral?

Question: David Risinger - Leerink Partners - Analyst : So that's all you get for $27 billion? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 10, 2025 / 1:20PM, LLY.N - Eli Lilly and Co at Leerink Partners Global Healthcare Conference

Question: David Risinger - Leerink Partners - Analyst : I look forward to seeing Dave smiling for a picture with Donald Trump in the Oval Office soon. Okay. So with respect to the momentum to date, if we could just pivot to just what you've seen year-to-date, we're now in mid-March. So with respect to the prescription demand that Lilly is observing, is it consistent with your expectations that you've set for revenue guidance this year?

Question: David Risinger - Leerink Partners - Analyst : Excellent, excellent. And could you just talk about the -- maybe this is a question for Mike. Just talk about the IQVIA inflection and how we should think about that and whether that's still a moving target or whether the new base that was starting to be reflected on February 14 or in the February 14 dataset, including LillyDirect, was the go-forward level from that point.

Question: David Risinger - Leerink Partners - Analyst : All right. So regarding compounders, it looks like they're finally going to be off the market on March 19. So management has characterized the compounders as having had no meaningful impact on performance despite all the noise. And obviously, that's because tirzepatide is more difficult to make than sema, and most compounders are making compounded sema. But how should we think about the impact? I guess maybe I've already answered the question, right? But you said that they've had no meaningful impact on performance. How would you characterize whether there will be anything noticeable in coming months once they are off the market? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 10, 2025 / 1:20PM, LLY.N - Eli Lilly and Co at Leerink Partners Global Healthcare Conference

Question: David Risinger - Leerink Partners - Analyst : Excellent. And then in terms of OSA as the driver sleep apnea, could you characterize that for 2025?

Question: David Risinger - Leerink Partners - Analyst : Got it. And then in terms of SURMOUNT-5, my guess is that consumers/patients probably still underappreciate how much better a drug tirzepatide is than semaglutide. The media just typically talks about Ozempic, et cetera. So could you speak to when we should expect the company to be able

Question: David Risinger - Leerink Partners - Analyst : Okay. Got it. All righty. In terms of ex US markets, so I'm hoping that you could provide a little bit more color on tirzepatide's rollout just so that we better understand how gated it is, whether there are supply constraints in any of the markets of the 30 that you've launched in to date. Just contextualize for us where those rollouts stand and how the additional volume ramp will play into ex US sales over the course of the year.

Question: David Risinger - Leerink Partners - Analyst : And so just to repeat, so you've launched in more than 30 countries.

Question: David Risinger - Leerink Partners - Analyst : How many of them have reimbursement for diabetes? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 10, 2025 / 1:20PM, LLY.N - Eli Lilly and Co at Leerink Partners Global Healthcare Conference

Question: David Risinger - Leerink Partners - Analyst : Got it. Okay. Excellent. So why don't we pivot to orforglipron since you mentioned it. So obviously, Dan has said that he expects it to demonstrate a profile that's consistent with injectable semaglutide. In terms of the forthcoming press release for the first trial in type 2 diabetes, what should we expect to be included?

Question: David Risinger - Leerink Partners - Analyst :

Question: David Risinger - Leerink Partners - Analyst : So it is the shorter end of what you're seeing?

Question: David Risinger - Leerink Partners - Analyst : The ATTAIN studies, if you think about the ones that are people very interested in, we might see a higher weight loss, ATTAIN-1, ATTAIN-2, is like a 72-week endpoint. So...

Question: David Risinger - Leerink Partners - Analyst : Excellent. Okay. And it would be helpful for you to just contextualize how you see the market opportunity for the oral, right? So on the one hand, it sounds like you're not really going to have any manufacturing constraints, which is very important. You could also price it slightly lower. But then again, you would just be pricing against yourselves since there are no oral small molecule competitors. And so maybe you could just paint the picture for how you're framing the commercial potential for orforglipron, assuming it has the profile you expect. I guess -- and I'm thinking specifically for obesity. We'll just leave diabetes aside for now.

Question: David Risinger - Leerink Partners - Analyst : Excellent. And could you talk about the opportunity just with your portfolio, including orforglipron, to really strengthen your role with insurers/PBMs. So it seems like orforglipron is going to offer the opportunity to fortify the company's leadership position in diabetes and in obesity well before various injectable and oral small molecule competitors launch three years plus from now.

Question: David Risinger - Leerink Partners - Analyst : That makes a lot of sense. Excellent. So why don't we pause for a minute? We have about 5 minutes left. Just wanted to see if there are any questions from the audience. All righty. So I'd like to pivot since we only have a few more minutes left to Verzenio. So Verzenio has been a very powerful growth driver, and it is a very substantial drug for Lilly. Could you talk about the pushes and pulls considering the positive growth drivers but also the competitive dynamics?

Question: David Risinger - Leerink Partners - Analyst : Excellent. Okay. And then just thinking about a few other financial questions. So with respect to R&D, so the company appears set to spend $13 billion or so, maybe a little more, in '25. And considering that orforglipron's 12 Phase III trials will be basically completing this year or the vast majority will and retitrutide Phase IIIs will be wrapping up over the next year or so, is it appropriate to think about sort of your incretin spending levels on R&D sort of peaking this year, considering the rollovers of those Phase III programs? And how should we think about that total R&D spend progressing in the future?

Question: David Risinger - Leerink Partners - Analyst : Excellent. And one final question. So obviously, your financial prospects are very robust this year, including, I think, slight gross margin expansion. How should we think about the gross margin longer term for the company? I would think that you'll get the benefits of manufacturing operating leverage plus some mix shift towards orforglipron, which will be higher margin. But then again, you're expanding into ex US markets, which are lower priced, et cetera. So how should we think about the gross margin beyond '25?

Question: David Risinger - Leerink Partners - Analyst : Excellent. Well, we are out of time. Thanks so much for being here with us. Appreciate it.