This story was originally published on BioPharma Dive. To receive daily news and insights, subscribe to our free daily BioPharma Dive newsletter. Dive Brief: Novo Nordisk’s largest investor said Tuesday it wants to replace more than half of the drugmaker’s board, calling an extraordinary general meeting of shareholders in November to install a handpicked slate of candidates. The election of new candidates is necessary because the current board was “too slow in recognizing” changes in the obesity drug ...

Core Insights - Pfizer announced its intention to acquire Metsera, a weight-loss drug developer, for up to $4.9 billion, aiming to strengthen its position in the obesity treatment market [1] Company Summary - The acquisition of Metsera is part of Pfizer's strategy to enhance its portfolio in the lucrative obesity treatment sector [1] Industry Summary - The obesity treatment market is characterized as lucrative, indicating significant growth potential and demand for effective weight-loss solutions [1]

Core Insights - Eli Lilly's stock dropped by 14% despite strong quarterly earnings, revenues, and guidance exceeding market expectations, primarily driven by the success of medications Mounjaro and Zepbound [2][3] - The decline was largely due to disappointing results from the late-stage clinical trial for Orforglipron, which showed patients lost nearly 12% of body weight, below the 15% expected by analysts [3] - The market reacted positively to competitors like Novo Nordisk, which is also developing an oral weight-loss pill, raising concerns about Eli Lilly's position in the market [3][15] Financial Performance - Eli Lilly's revenues grew significantly, with a 38% increase to $15.6 billion in the most recent quarter compared to $11.3 billion a year ago, while the S&P 500 saw only a 4.3% improvement [9] - Over the last three years, Eli Lilly's average revenue growth rate was 20.2%, significantly higher than the S&P 500's 5.2% [7] - The company's operating income over the last four quarters was $23 billion, resulting in a high operating margin of 46.5% compared to 18.4% for the S&P 500 [17] Valuation Metrics - Eli Lilly has a price-to-sales (P/S) ratio of 13, compared to 3.0 for the S&P 500, and a price-to-earnings (P/E) ratio of 42 versus the benchmark's 22.6 [8] - Despite the recent stock decline, analysis suggests that Eli Lilly's stock may represent a buying opportunity due to its strong long-term outlook and financial health [4][5] Competitive Landscape - Eli Lilly faces significant competition from Novo Nordisk in the weight-loss sector, which could impact its market share and stock performance [15][16] - The potential for further stock declines of 30-40% is noted if Novo Nordisk's oral weight-loss pill proves to be more effective [15] Future Outlook - Analysts project a nearly 50% upside for Eli Lilly, with an average price target of $945, driven by the potential of the obesity treatment market and the company's recent advances in sales and profitability [19] - The company's strong fundamentals and operational performance indicate ongoing substantial revenue growth, primarily due to its GLP-1 portfolio and pipeline [16]