Eli Lilly CEO David Ricks is confident that weight loss med Zepbound is gaining market share at the expense of Wegovy, even as its rival strikes deals with CVS and Hims & Hers pharmacies.
Eli Lilly has pulled ahead of rival Novo Nordisk in the obesity market, according to analysts, just as CVS Health chose sides in the fierce head-to-head battle.
Lilly booked $2.31 billion in sales for Zepbound during the first quarter, according to the company’s earnings report issued Thursday. But on the same day, CVS Health announced that rival med Wegovy would be made available on its formulary for just $499 per month.
“We’re not surprised this kind of thing was announced,” Lilly CEO David Ricks said on an investor call Thursday morning. “If we look at what’s happening in the market, we’re pretty deep into a replacement cycle, particularly on obesity.”
Ricks is confident that Zepbound is gaining market share at the expense of Wegovy. “Most of the growth in the category is happening with our benefit,” the CEO said. Novo will not report its first quarter earnings until May 7, but Lilly’s obesity portfolio eclipsed the Danish rival last quarter.
Calling it “important,” Ricks said Lilly would like to expand its primary pay segment, where patients pay for their medications themselves without insurance. Lilly offers Zepbound to patients through a direct-to-consumer program called LillyDirect. But Ricks brushed off the CVS endorsement and said Lilly would like to see expanded choice and access in the primary pay market, so “this type of thing isn’t too interesting to us.”
Truist Securities analysts, however, said CVS’ choice will cause some near-term pressure on Lilly. Novo also announced a deal with telehealth pharmacy Hims & Hers this week pricing Wegovy at $599.
One analyst, Steve Scala, who has a history of throwing tough questions at pharma executives, reminded executives that Lilly had used a similar formulary tactic for its earlier psoriasis medicine Taltz.
Ricks said he did not remember the situation that way, but these formulary battles typically play out when there are multiple options for patients with similar clinical profiles. In the case of Taltz, Lilly was the come-from-behind company. Zepbound, though it trailed Wegovy to market, is pushing boundaries on innovation, Ricks asserted.
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Like all of its peers, Lilly addressed the threat of tariffs, too. Ricks urged the Trump administration to consider tax policy changes instead of tariffs, similar to some of his peers like Johnson & Johnson’s Joaquin Duato.
“We support the U.S. government’s goals to increase domestic investment. However, we don’t believe tariffs are the right mechanism,” Ricks said.
The currently announced tariffs will not have an impact on Lilly’s 2025 financial outlook, the CEO noted, but expansions into other areas or increased retaliatory tariffs could change that. Lilly has already announced $27 billion in U.S. manufacturing expansions.
“We urge the administration to negotiate deals with key trading partners as soon as possible, level the playing field for American exporters like Lilly and remove harmful tariffs and non-tariff market access barriers in the developed economies.”
Elsewhere, Lilly withdrew an application for tirzepatide (the active ingredient in Zepbound) in heart failure with preserved ejection fraction (HFpEF) after the FDA requested an additional confirmatory clinical trial. The GLP-1 was submitted to the FDA and in Europe in this indication in November 2024 after the Phase III SUMMIT trial showed a 38% drop in the relative risk of heart failure outcomes.
Chief Scientific Officer Dan Skovronsky said the trial showed “a really strong and profound benefit for patients,” so he was disappointed in the FDA’s decision to require another trial. Lilly is unlikely to conduct such a large trial because there is plenty of evidence from clinical studies in related indications like obesity that can support the benefit in heart failure, Skovronsky said.
“It’s kind of hard to think of the incentive for doing large outcome trials in this population that’s already covered under an existing indication. The benefits are well understood,” the CSO continued. “Just remember that all of the patients in this trial indication are already covered under the obesity indication. So it’s not a new population to treat.”
But the decision could have a chilling effect on investment in HFpEF, Skovronsky added, noting this is an indication with a huge unmet need.
