Eli Lilly - The first "100 billion dollar" pharmaceutical company!

Thanks to the strong demand for weight loss and diabetes medications, Eli Lilly has become the first pharmaceutical company in the world to join the trillion-dollar club.

On Friday, Eli Lilly's stock price rose by 1.60%, accumulating nearly 40% growth this year. The company's market value surpassed $1 trillion, joining the ranks of the seven tech giants and Berkshire Hathaway under Warren Buffett.

(Eli Lilly rose 1.60% on Friday)

Wall Street Journal mentioned that Eli Lilly is rapidly widening the gap with competitors due to its overwhelming advantage in GLP-1 drugs.

Although Eli Lilly's weight loss drug Zepbound will not be launched until the end of 2023, it has already successfully surpassed Novo Nordisk's Wegovy in terms of new obesity drug prescriptions, thanks to increased production capacity and new clinical data.

Investor enthusiasm for the pharmaceutical sector is also continuing to rise. On Friday, the U.S. healthcare ETF rose over 2%, accumulating a 12% increase this year, as market concerns about Trump's tariff threats and drug price cuts began to ease.

(U.S. healthcare ETF has accumulated a 12% increase this year)

Strong Growth in Weight Loss Drug Sales

Eli Lilly's sales of weight loss drugs in the third quarter more than doubled compared to the same period last year, thanks to the company's expansion into new markets.

Mounjaro, used for treating diabetes, and Zepbound, used for weight loss, generated a total revenue of $10.1 billion in that quarter. Morningstar's head of healthcare research, Karen Andersen, stated:

It is currently difficult to find any flaws in Eli Lilly's strategy. Everything is in Eli Lilly's favor.

She pointed out that disappointing trial results for the new weight loss drug orforglipron last August led to a drop in stock prices, "This is the only negative news I can think of regarding Eli Lilly."

Neuberger Berman portfolio manager Rick Bradt noted that the rapid rise in Eli Lilly's stock price in recent weeks is partly due to investors shifting from chasing growth in large tech companies focused on artificial intelligence to other sectors. He said:

There has been a massive sector rotation in the U.S. stock market. Therefore, you see widespread outperformance in the healthcare sector. Eli Lilly stands out among pharmaceutical companies at every level.

Eli Lilly is on the Eve of the "Strongest New Product Cycle in Biopharmaceutical History"

Wall Street Journal previously mentioned that Goldman Sachs believes Eli Lilly's oral weight loss candidate orforglipron represents "one of the most important new product cycles across the entire biopharmaceutical coverage." **

Eli Lilly's management revealed that global regulatory submissions are about to begin, with expectations to launch an obesity treatment in the U.S. market next year.

Notably, the drug meets four out of at least three requirements of the FDA's national priority voucher program, paving the way for expedited approval.

In terms of pricing strategy, Eli Lilly views orforglipron as a sales model similar to Zepbound, focusing on leveraging the LillyDirect direct-to-consumer platform. Management emphasized that the convenience of the oral formulation will significantly expand the global target market size.

In addition to the GLP-1 product line, Eli Lilly is also performing well in next-generation obesity compounds.

According to Wall Street News, phase II data for the selective incretin agonist eloralintide shows a weight loss of 20.1%, and late-stage clinical trials will be initiated.

Kenneth Custer, president of Eli Lilly's cardiovascular metabolic health division, stated that the data shows eloralintide has strong efficacy and better tolerability, serving as an alternative to incretin therapy.

Additionally, results from six phase III trials of the triple agonist retatrutide are expected to be released by the end of 2026.

It is noteworthy that Eli Lilly has newly disclosed that its Lp(a) project muvalaplin has entered phase III clinical trials, and this emerging cardiovascular treatment area is becoming a focal point for investors. Phase II data shows that the drug can reduce biomarker levels by over 85% compared to placebo at the highest dose.

Major Shareholder Reduces Holdings and Valuation Concerns

As Eli Lilly's stock price soars, the company's largest shareholder, the Eli Lilly Foundation, has been selling shares.

According to stock sale data tracked by VerityData/TMX Datalinx, the foundation sold a record $2.4 billion in stock in the fourth quarter of 2025, surpassing the previous record of $1.3 billion set in the second quarter of 2024.

Eli Lilly commented on breaking the $1 trillion market cap:

Eli Lilly remains focused on our commitment to scientific breakthroughs and strategic investments to drive a rich product line to meet patient needs.

Moreover, as Eli Lilly's market cap surpasses $1 trillion, debates about its valuation are intensifying. Currently, data shows that the company's forward P/E ratio for 2026 is 41 times, far exceeding the pharmaceutical industry's average of about 16 times.

However, according to FactSet forecasts, the annual sales of Eli Lilly's two star drugs are expected to exceed $40 billion by 2026 and approach $60 billion before 2030, which may support the high valuation.

The biggest long-term risk lies in the patent system.

Unlike tech companies that can infinitely iterate products, any blockbuster drug faces the "physical law" of patent expiration. Citi's Davis bluntly stated:

This will be the largest patent cliff in history At that time, competition from companies such as Amgen and Pfizer will also intensify