Eli Lilly (NYSE:LLY) shares lost about 4% during Thursday’s pre-market after the company failed to beat revenue projections for the second quarter of 2022, with the first topline decline since the second quarter of 2020.
Eli Lilly’s Revenue Plummets as COVID-19 Treatment Sales Decline
Worldwide revenue for the quarter decreased by 4% year-over-year to $6.5 billion on a reported basis, missing Street expectations of $129.1 million with a 13% year-over-year decline due to sales of COVID-19 antibodies. Lilly reported $1.5 billion in COVID-19 antibody sales in the first quarter of 2022, an 81% year-over-year increase.
Eli Lilly ascribed the decline in sales to an 11% drop in realized prices and a 3% negative impact from foreign exchange. Income from the United States increased by 6% year-over-year to $3.9 billion, while revenue from other countries fell by 16% year-over-year to $2.6 billion.
According to Lilly’s chief financial officer Anat Ashkenazi, “Excluding revenue from the Alimta loss of exclusivity in major markets, the sale of rights to Cialis in China in the base period, and COVID-19 antibodies, Lilly experienced 6% revenue growth in our core business led by a strong performance from key products such as Trulicity, Verzenio, and Jardiance.” This growth was driven by the strong performance of key products like Trulicity, Verzenio, and Jardiance.
While Trulicity and the diabetes medicine Jardiance gained $1.9 billion and $461.0, respectively, to surpass projections with 25% year-over-year and 29% year-over-year increases, the sales of the lung cancer drug Alimta decreased 63% year-over-year to $227.7 million.
While non-GAAP gross margin increased to 79.8% from 79.3% in the same period last year, non-GAAP net income decreased by 33% year-over-year to $1.1 billion.
Eli Lilly Reiterates its Sales Target
On the regulatory front, Lilly said that the FDA has granted Priority Review status for accelerated review of the marketing application for the much-awaited Alzheimer’s medicine donanemab.
In addition, Eli Lilly has chosen to distribute its COVID-19 medication bebtelovimab through a single distributor starting the following week to increase commercial availability. As a result, before the government’s stocks run out, U.S. states/territories, hospitals, and other healthcare organizations can buy bebtelovimab.
Despite an additional $400 million effect from adverse FX movements, Lilly reaffirmed its sales target for 2022. However, Lilly reduced its earnings estimate from $7.30 to $7.45 and $8.15 to $8.30 three months ago to $6.96 to $7.11 on a reported basis and $7.90 to $8.05 on a non-GAAP basis.
Featured Image: Megapixl @Michaelvi
