Zhi Tong Cai Jing·2025-08-11 08:56Core Viewpoint - Eli Lilly's stock plummeted despite exceeding Q2 financial expectations and raising guidance, primarily due to concerns over the efficacy of its oral weight-loss drug Orforglipron in late-stage trials [1][3] Financial Performance - Eli Lilly reported a 72-week average weight loss of 12.4% with Orforglipron, meeting the primary endpoint of the Phase 3 ATTAIN-1 trial, but this was perceived as underwhelming compared to competitors [1][3] - The company raised its full-year revenue guidance to $60-62 billion, surpassing the previous estimate of $58-61 billion, indicating strong fundamentals [4] Market Reaction - Eli Lilly's stock fell 14% in a single day, marking its largest drop in 25 years, followed by an additional 2% decline the next day, resulting in a market value loss of nearly $100 billion [1][3] - In contrast, competitor Novo Nordisk's stock rose over 12% during the same period, benefiting from the negative sentiment surrounding Eli Lilly [1] Analyst Opinions - Leerink Partners downgraded Eli Lilly's rating from "outperform" to "market perform," reducing the target price from $944 to $715, citing lower-than-expected weight loss results and increased competition [2] - Bank of America analyst Tim Anderson argued that the market reaction was excessive, maintaining a "buy" rating and a target price of $1,000, emphasizing that the disclosed data was only preliminary [2] Industry Context - The global market for weight-loss drugs is projected to reach $95 billion by 2030, down from previous estimates of $130 billion, reflecting a shift in market expectations [3] - The competitive landscape in the GLP-1 market is intensifying, with concerns over pricing pressures and inadequate insurance coverage for weight-loss medications in the U.S. [2][6] Strategic Implications - Eli Lilly's valuation has been impacted by the market's shift from rewarding solid fundamentals to demanding exceptional performance, leading to a reevaluation of its growth potential [4][5] - The company faces the challenge of refocusing market attention on its diverse pipeline and robust operational capabilities to navigate the current crisis [6]