Bank of America boosts estimates on Eli Lilly, following consumer analysis

A customised consumer analysis undertaken by Bank of America to look at the growing excitement surrounding new obesity drugs led the company to retain its Buy rating on Eli Lilly & Co. (NYSE:LLY) and increase their 12-month price objective on the stock to $500.00 (From $450.00).

To determine the existing demand, uptake, and treatment restrictions for weight loss therapies, Bank of America analysed the replies of more than 1,100 U.S. customers.

The experts also examined the constantly shifting social media landscape, concentrating on the weight loss industry. They wanted to know what prospective clients said and how pricing influenced their decisions.

More than 55% of participants in the survey reported learning about these therapies through social media, indicating the necessity for focused advertising. Bank of America anticipates greater interest in Mounjaro as patients get more familiar with the advantages following Lilly’s introduction of the first direct-to-consumer marketing for T2D in the first quarter.

According to our data, consumers appear to be particularly interested in Lilly’s Trulicity and Novo’s Ozempic (reported on by Jain and Parry) for weight loss, which we would primarily ascribe to the novelty of Mounjaro and Wegovy. But in the end, we do not anticipate the fight against obesity will be a zero-sum game. We believe that the presence of several major firms (such as Lilly, Novo, Pfizer, and others) would result in more rapid advancements in reimbursement and competitive pricing pressure, which should speed up adoption.

For the years 23 through 30, Bank of America improved its Mounjaro Type 2 diabetes revenue predictions by an average of 19%. Additionally, they elevated predictions for tirzepatide in obesity by an average of 40% for the years 23 through 30.

Shares of LLY are up 0.51% in mid-day trading on Wednesday.