Eli Lilly shares hit record high after FDA approves drug for weight loss treatment

Takeaways

Eli Lilly shares hit an all-time high after receiving FDA approval for Zepbound, an injectable drug intended to help people lose weight.
The active ingredient The drug, tirzepatide, had previously been approved to treat patients with type 2 diabetes under the brand name Mounjaro.
A phase 3 trial indicated that some Zepbound patients lost more than 58 pounds after 72 weeks of treatment.
The FDA approval comes as demand has soared for treatments that can help patients lose weight, boosting sales for Eli Lilly and Novo Nordisk, the maker of Lilly. Ozempic and Wegovy.

Shares of Eli Lilly (LLY) hit a record high Wednesday after the Food and Drug Administration (FDA) approved the drugmaker's Zepbound injection to treat people who are obese or overweight and have also weight-related medical problems, such as hypertension and type 2 diabetes.

The FDA had previously approved the drug's active ingredient, known as tirzepatide, in May 2022 as a treatment for patients with type 2 diabetes. 2 under the Mounjaro brand.

The company said the approval was based on results from its Phase 3 study, which showed that patients who took the highest dose of Zepbound for 72 weeks lost an average of 48 pounds, while those who who received the lowest dose lost an average of 34 pounds. He added that one in three patients given a high dose lost more than 58 pounds.

“For decades, diet and exercise have been the go-to, but it's not uncommon for someone to have tried 20 to 30 times to lose weight with this approach. Research now shows that the body can respond to a calorie deficit diet by increasing hunger and reducing feelings of fullness, making weight loss more difficult. Lilly aims to eliminate misconceptions about this disease and transform how it can be managed," said Dr. Leonard Glass, senior vice president of global medical affairs at Lilly Diabetes and Obesity.

Approval of FDA responds to skyrocketed demand for treatments that can help patients lose weight, boosting sales for Eli Lilly and Novo Nordisk (NVO), the maker of Ozempic and Wegovy .

Lilly indicated that Zepbound is expected will be on the market by the end of the year at a list price of $1,060 for a one-year supply.