Bloomberg Audio Studios, Podcasts, radio News. This is Bloomberg BusinessWeek with Carol Masser and Tim Steneveek on Bloomberg Radio.
We are talking about Eli Lilly, this stock surging after data showed its experimental weight loss pill worked as well as the ozempic shot, bringing it one step closer for developing a needle free alternative. So let's get the details from Bloomberg News healthcare reporter Damian guard he's here in Gardier. Who's here in studio, Damien? Good to have you here. Often running shares of Eli Lilly. I think it's the top gainer in the s and P five hundred up something like sixteen percent right now.
Which is a massive gain. I mean, just to note this is already a very expensive stock. Lily has flirted with becoming the first one trillion dollar drug company in marketcap, which I don't think they're there yet, basically based on the theory that they can corner the market by consistently kind of out innovating themselves in the race for these
hot obesity medicines that everybody talks about. So to the news today, they had pivotal data from a late stage study showing that their pill and oral treatment looks like it works about as well as the injectable ozembic made by its rival Novo Nordisk, at least in patients who
have type two diabetes. And this was closely watched because despite it being a relatively smaller study and it being diabetes and not obesity, everybody is looking at the read through of what is the weight loss them And if this is a pill that you take once a day, hallelujah, they can do what a weekly injection can do. That is again like a holy grail product in this market.
A couple things you said, it's not yet a trillion dollar company they want to be. It's eight hundred and eleven billion dollars. That's acap right now. Today's move higher, whopping sixteen percent a pill versus an injection, And look, I don't like needles. A lot of people don't like needles. Paul Sweeney was on earlier today talking on Bloomberg Intelligence, talking about surveillance. He says he's administered this shot. He says it's no big deal. His question was more about
what about side effects here? That seems to be more of a barrier, at least in his experience.
That's true so for people who can get over the needle aspect, which is definitely true for people who have type two diabetes, and we're finding out based on the demand for these medicines that it's true for people who want to lose weight as well. The side effect issue is all gastro intestinal, or at least those are the most common and the most That's what yes vexing for people. So looking and again this is something scientists say never
to do. And dude, anyway, a cross trial comparison, which is looking at Lily's data and comparing it to what we saw with those empics published data, I would say they're relatively comparable. The rates of you're talking about vomiting, diarrhea, I apologize, so maybe this is not the toat we usually shoot for on this show, and nausea. In some cases they were a little higher with Lily's pill. In
some cases they were higher with the injections. But I think the reaction right now is that they look pretty similar. But I guess that could end up being the barrier in the future if and when this product's approved and we kind of remove the needle aspect, it's are you comfortable being one of the ten to fifteen percent of people who experience those side effects.
Because I do I know of people who've like moved around because they have really bad side effects from certain drugs. They're not necessarily apples to apples. There's there's some variances. I mean, Novo's down about seven percent. Should Novo be worried.
Yes, I mean there's an argument that so Lily and Novo have been the two giants of this market, Novo being based in Denmark, Lily being based in Indiana, and they've both been focused on diabetes for I mean, in Lily's case, more than one hundred years, dating back to like the initial synthesis of insulin, and so they've been fighting one another in this place for basically the entirety of their corporate histories. These data today and Lily's trajectory.
Maybe this is unfair, but it feels like they have kind of out gamed Novo in this market. Nova has, you know, the major product in the form of ozempic, but Lily has an injectable medicine that works a little bit better than ozempic and now appears to be knocking on the door of having a pill.
What's the next you know, when we think about pipelines, this stuff takes years. That's why the startup biotech companies are so volatile. If we're thinking about the pipeline, a pill is sort of the next iteration, that's the golden goose, That's what people are going for. What's next after that?
So it's interesting because everybody has kind of differentiated You just.
Breathe in, you spray something and just really no, I'm just kidding, that's a mist would not be so bad.
Not impossible, I think scientifically as well. But barring the you know, aerosolization of GLP one kids, I don't think we're there yet. Okay, So both Lily and Novo and a few other companies including Astrozenca are kind of moving in parallel tracks where there is the move to develop oral medicines that might lead to a little less weight loss but would be more accessible and were able to
produce and cheap to produce. And then there's a next generation of injectables that appear to, at least so far, have even stronger effects on body weight, So twenty to twenty five percent body weight loss versus the smaller numbers we see and the theory is that by let's say the end of the decade, if all these things work, it would be kind of like an armamentarium for people
looking for treatments. For people who have obesity such that losing twenty five percent of their body weight is medically necessary for their health, you would have the kind of like big guns. This is all a little crude, but the more efficacious injectable treatments. And then for people for whom a smaller percentage body weight treatment is more desirable, or who perhaps just need to maintain loss that they got from one of those drugs, you would have the pills.
So kind of a menu of drugs. Right. Essentially, Hey, Eli, Lily is the top gainer in the s and P five hundred. United Health is the top decliner. I just we've got you got to ask. Stocks down like twenty three percent. Here they cut its annual forecast and reported its first earnings missing over a decade. What do we need to know about this? Is this also an industry wide problem because it dragged down the group Today.
It does seem like it. The word ominous has been invoked a few times now. United Health is difficult to crosscut because they are this like octopus of healthcare. They do everything, sort of developed their own medicines, but in terms of insurance managed care, they are a you know, arguably kind of monoymous. Yeah, and so, but in that sense they are perceived as a bellweather. So they report earnings, they have this unforeseen issue with their profitability relating to
Medicare advantage or sort of a supplementary insurance program. And I think part of the ominous nature of that is the thing they're suffering from is from basically a government crackdown on how Medicare advantage works that began last year. And you might think that that would alleviate under a new administration, but doctor oz memet Oz, who is stepping into the role of leading the federal agency that runs Medicare, was very fiery in his Senate confirmation hearing about exactly
this issue. And so I think some of the stock reaction is not just the shock of, as you mentioned, the superlative of United missing earnings for the first time in a decade, but also that like the storm clouds seem to just still be on the horizon.
Yeah, storm clouds over another industry is what a kind of feels like what.
He can talk about anything. Damian Guardia can talk about anything. It's like he's been writing about Lily all day and you throw him the United Health question and he knocks it out of the park.
Thank you so much.
Time we can talk about doctor Oz.
Thanks for joining us.
Blimberg News healthcare reporter Damian Guardi