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Eli Lilly and Company (LLY)

  • Apr. 23, 2014, 5:30 PM
  • Apr. 22, 2014, 12:50 PM
    • Eli Lilly's (LLY -0.9%) all-cash $5.4B acquisition of Novartis (NVS +1.4%) Animal Health makes Elanco the world's second-largest animal health company.
    • The purchase will be made with $3.4B of cash on hand and $2B in debt.
    • Lilly expects to wring out $200M (~10%) in annual cost savings within three years of the expected Q1 2015 close.
    • It forecasts EBIT yield in the mid-20% range by 2018.
    • The transaction will be accretive to earnings on a cash basis starting in 2016, exclusive of integration costs.
    • Management does not expect the deal to change the firm's dividend policy or current share repurchase program.
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  • Apr. 22, 2014, 2:11 AM
    • Novartis (NVS) has agreed to exchange certain assets with GlaxoSmithKline (GSK) and it is selling its animal-health division to Eli Lilly (LLY) for around $5.4B.
    • Novartis will buy GSK's oncology products for an initial $14.5B and up to $1.5B in development milestones. The Swiss company will also sell its vaccines business to its U.K. rival for $5.25B upfront and as much as $1.8B in milestones, as well as royalties. The latter deal doesn't include Novartis' flu business, which the company plans to sell separately.
    • Novartis will also combine its over-the-counter operations with GSK Consumer Healthcare in a joint venture in which Novartis will own 36.5%.
    • Eli Lilly will fold Novartis' animal-health unit into its Elanco business, creating the second-largest company in the sector in terms of global revenue.
    • Novartis PR, Eli Lilly PR
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  • Apr. 21, 2014, 5:16 PM
    • The FDA approves Eli Lilly's (LLY) Cyramza (ramucirumab) for advanced stomach cancer and gastroesophogeal junction adenocarcinoma. The product is an angiogenesis inhibitor that blocks the blood supply to tumors.
    • According to the National Cancer Institute over 22K people will be diagnosed with stomach cancer this year. The mortality rate is ~50%.
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  • Apr. 14, 2014, 9:20 AM
    • The FDA accepts the NDA filed by Boehringer Ingelheim Pharmaceuticals and Eli Lilly (LLY) for the combo tablet of empagliflozin and Tradjenta (linagliptin) for the treatment of Type 2 diabetes in adults.
    • The product offers the mechanisms of a sodium glucose co-transporter-2 (SGLT2) and a dipeptidyl peptidase-4 (DPP-4) inhibitor in a single tablet.
    • SGLT2 inhibitors remove excess glucose through the urine by blocking its re-absorption in the kidney. DPP-4 inhibitors work by increasing hormones that stimulate the pancreas to produce more insulin and stimulate the liver to produce less glucose.
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  • Apr. 10, 2014, 9:32 AM
    • In its recent healthcare budget, French lawmakers introduced a measure that will allow pharmacists to substitute generics for prescribed brand-name biotech drugs. This has rattled the industry since France is Europe's #2 pharmaceutical market behind Germany.
    • A decree must be passed before it becomes effective.
    • France is the first European country to pursue biologic substitution. Big Pharma fears a domino effect if it is successful despite the heretofore slow uptake of biosimilars.
    • The initiative applies only to patients starting a new course of treatment. Doctors will still retain the ability to demand the branded product.
    • Unsurprisingly, Big Pharma is upset at not being consulted prior to the law's passage.
    • Some analysts believe France could save up to $1.4B by 2020 by using generics.
    • Substitutions only apply to retail pharmacies. 40% of biotech prescriptions are filled in hospitals.
  • Apr. 8, 2014, 3:07 AM
    • A jury has ordered Japan's Takeda (TKPYY) to pay $6B and Eli Lilly (LLY) $3B in punitive damages over allegations that they hid the cancer risks associated with the diabetes therapy Actos.
    • However, Eli Lilly could be off the hook, as Takeda agreed to indemnify Lilly for any legal liability connected to Actos.
    • In addition, the award is likely to be cut on appeal, as the Supreme Court has set limits on punitive verdicts.
    • In two previous cases, judges quashed multi-million dollar awards against Actos.
    • Notwithstanding, Takeda's shares slumped 5.2% in Tokyo.
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  • Apr. 7, 2014, 7:49 AM
    • Eli Lilly's (LLY) Bemaciclib drug aided 61% of participants in a Phase I trial of 132 patients with metastatic, hormone-sensitive breast cancer.
    • The size of tumors shrunk by 30% or didn't increase for 24 weeks.
    • Progression-free survival was 9.1 months.
    • Like Pfizer's Palbociclib, which performed well in a Phase II study, Bemaciclib is part of a new class of drug called CDK 4/6 inhibitors. These treatments limit the activity of two enzymes involved in cell division — cyclin-dependent kinases 4 and 6.
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  • Apr. 4, 2014, 2:16 PM
    • Merck (MRK +0.4%) wants to feed its controversial additive to almost a quarter of a million cattle to prove it is safe. The only glitch is that major meat processors lack enthusiasm for animals fed with the drug.
    • Feedlot owners are glad to participate if they have assurances from the slaughterhouses that they will buy the animals.
    • The company intends to sign up 5 to 15 feedlots per slaughterhouse that agrees to process the cattle.
    • Raising a few eyebrows is Merck's silence regarding the identity of the study's lead investigator. Some observers perceive that its lack of disclosure implies the study's outcome is a foregone conclusion.
    • Since the firm pulled Zilmax in August, many feedlots have switched to ractopamine-based Optaflexx made by Eli Lilly's (LLY +0.6%) Elanco Animal Health Unit.
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  • Apr. 3, 2014, 9:05 AM
    • Cowen & Company upgrades Eli Lilly (LLY) to Outperform with a $68 PT. Yesterday's close was $59.15.
    • Consensus estimates for Q1 and Q2 are earnings of $0.70/share on revenues of $4.76B and $0.66/share on revenues of $4.85B, respectively.
    • Consensus views for 2014 and 2015 are earnings of $2.81/share on revenues of $19.7B and $3.18 on revenues of $20.2B, respectively.
    • 1825 mutual funds have positions, down from 1967 a year earlier.
    | 1 Comment
  • Apr. 2, 2014, 11:30 AM
    • Last summer's dust up between GlaxoSmithKline (GSK) and Chinese regulators over accusations of corruption has quietly subsided. Drug firms perceive the China market has returned to its "business as unusual."
    • Glaxo responded to the matter by replacing its sales targets for individual reps with broader performance-rating criteria such as improved patient care.
    • Although far from assured, other members of Big Pharma don't expect the authorities to rattle their sabers again any time soon.
    • Analysts expect the nation's drug market to continue its annual 15% growth rate and emerge as the globe's second largest pharmaceutical market behind the U.S. by 2016 on the basis of $165B in sales.
    • (SNY) (LLY) (NVS) (AZN) (PFE) (BMY) (JNJ) (BAYRY) (RHHBY) (NVO) (ABBV)
  • Apr. 1, 2014, 11:35 AM
    • A U.S. District Court rules for Eli Lilly (LLY -0.1%) in its patent case versus Teva Pharmaceutical Industries' (TEVA -0.8%) subsidiary Teva Parenteral Medicines. The suit pertains to Lilly's vitamin dosage regimen patent for Alimta (pemetrexed for injection).
    • The court finds the patents valid and enforceable. The company's IP protection will continue until 2022.
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  • Apr. 1, 2014, 8:28 AM
    • A district judge has upheld the validity of a patent on Eli Lilly's (LLY) blockbuster Alimta lung-cancer drug, which generates sales of $2.6B a year.
    • The decision will maintain the treatment's exclusivity until 2022, pending the outcome of any appeal.
    • Companies on the losing side in the case include Teva (TEVA) and Fresenius Kabi (APCVZ). (PR)
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  • Mar. 27, 2014, 10:26 AM
    • The FDA reports that 25 of 26 animal drug manufacturers have voluntarily agreed to remove labeling for "growth promotion" in response to the agency's December guidance.
    • The firms represent 99% of industry sales.
    • The change will be implemented over the next 3 years.
    • Antibiotics may still be used to treat, control and prevent disease but must be administered with a veterinarian's oversight.
    • (ZTS) (NVS) (LLY) (BAYRY)
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  • Mar. 26, 2014, 8:33 AM
    • Large cap pharma and biotech firms have regenerative therapy R&D programs underway according to a recent survey.
    • 69% of respondents are focused on developing cellular-based therapies.
    • Wound healing and burns have the greatest near-term potential.
    • Long term areas of interest are cardiovascular disease, oncology, neurodegenerative disease, monogenic disorders and ocular disease.
  • Mar. 21, 2014, 8:56 AM
    • The EMA's Committee for Medicinal Products for Human Use (CHMP) recommends approval for Boehringer Ingelheim and Eli Lilly's (LLY) empagliflozin, a sodium glucose co-transporter 2 inhibitor, as an adjunct to diet and exercise to improve glycemic control in type 2 diabetics.
    • The positive opinion is based on clinical trials involving more than 13,000 adults with type 2 diabetes.
    • The European Commission usually issues a legally binding decision withing 3 months of a CHMP opinion. Like the US, it typically follows the Committee's view.
    • Recently, the US FDA delayed its approval of the drug due to manufacturing deficiencies at Boehringer Ingelheim.
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Company Description
Eli Lilly and Co is a drug manufacturing company. It discovers, develops, manufactures, and sells human pharmaceutical products and animal health products.