Eli Lilly's GLP-1 growth is only getting started as Novo Nordisk braces for a decline in 2026

Core Insights - The article highlights the contrasting outlooks of Eli Lilly and Novo Nordisk in the obesity drug market, with Lilly expecting significant revenue growth while Novo anticipates a decline in sales [1][7]. Company Performance - Eli Lilly forecasts 2026 sales between $80 billion and $83 billion, exceeding analyst expectations of $77.62 billion, indicating a projected sales growth of 25% this year [7]. - In contrast, Novo Nordisk expects a sales and profit decline of 5% to 13% this year due to falling prices in the U.S. and the expiration of exclusivity for its key drugs in several markets [7]. Market Dynamics - Lilly's competitive edge is attributed to its more effective drug formulations and early entry into direct-to-consumer sales, which has allowed it to gain market share over Novo Nordisk [2][3]. - The total addressable market for obesity treatments is described as "gigantic," with 20 million to 25 million patients currently using both companies' medications [4]. Drug Development and Launches - Lilly's upcoming obesity pill, orforglipron, is anticipated to compete with Novo's Wegovy, which has seen a strong launch in the U.S. [4][14]. - Novo's Wegovy pill has achieved 50,000 weekly prescriptions shortly after its launch, but Lilly's pill may benefit from its easier administration and lack of dietary restrictions [14][17]. Competitive Landscape - Analysts suggest that Lilly's drug, tirzepatide, is superior in effectiveness and tolerability compared to Novo's semaglutide, contributing to Lilly's market share gains [12]. - Patent exclusivity is another differentiating factor, with Lilly's tirzepatide expected to be protected into the late 2030s, while Novo faces challenges from expiring patents [13]. Pricing and Market Access - Both companies are experiencing a global pricing decline in the low- to mid-teens percentage range due to recent pricing agreements, but Lilly remains optimistic about offsetting this pressure through increased prescription volumes [8][10]. - The introduction of Medicare coverage for obesity treatments is expected to expand access to 40 million new beneficiaries, which could significantly impact volume for Lilly [11].