By Sriparna Roy
(Reuters) – Eli Lilly is betting big on its experimental oral weight-loss drug even before reporting data from its late-stage trial by recording nearly $550 million in “pre-launch inventory” in its financial statements, a filing showed on Wednesday.
The move is unusual as it comes more than a year before the drug, orforglipron, is expected to be launched. Most drugmakers include such inventories, or assets, in their financial statements to show how much drug product has been manufactured right before approval.
“There have been recent similar pre-launch inventory builds, especially around COVID-19 vaccines, but with the launch not coming until 2026, this earlier-than-normal inventory build is certainly much larger than normal,” said Kevin Gade, chief operating officer at Bahl & Gaynor, which owns Lilly’s shares.
This reflects Lilly’s desire to be on the front foot by launching the drug as early as possible to build a time advantage in the market for tackling future competition, Gade said.
Danish drugmaker Novo Nordisk and Eli Lilly currently dominate the market for weight-loss treatments with their injectable drugs. Novo is studying the pill version of its experimental drug, amycretin, while others including AstraZeneca are also developing oral obesity treatments.
Evercore ISI analyst Umer Raffat, who highlighted the inventory build in a research note on Thursday, said the so-called capitalized inventory implied $10 billion in sales, based on 2024 figures alone. Raffat added that the inventory build-up will inevitably amplify.
In a mid-stage trial, the highest dose of orforglipron led to 14.7% weight loss after 36 weeks for people who were obese or overweight. Lilly is expected to report late-stage data for the drug by April.
Lilly also said on its post-earning conference call this month that it was already building manufacturing capacity for the drug.
(Reporting by Sriparna Roy in Bengaluru, additional reporting by Bhanvi Satija; Editing by Manas Mishra and Anil D’Silva)
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