Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. This is Bloomberg BusinessWeek
Speaker 1: with Carol Masser and Tim Steneveek on Bloomberg Radio.
Speaker 2: We are talking about Eli Lilly, this stock surging after
Speaker 2: data showed its experimental weight loss pill worked as well
Speaker 2: as the ozempic shot, bringing it one step closer for
Speaker 2: developing a needle free alternative. So let's get the details
Speaker 2: from Bloomberg News healthcare reporter Damian guard he's here in Gardier.
Speaker 2: Who's here in studio, Damien? Good to have you here.
Speaker 2: Often running shares of Eli Lilly. I think it's the
Speaker 2: top gainer in the s and P five hundred up
Speaker 2: something like sixteen percent right now.
Speaker 3: Which is a massive gain. I mean, just to note
Speaker 3: this is already a very expensive stock. Lily has flirted
Speaker 3: with becoming the first one trillion dollar drug company in marketcap,
Speaker 3: which I don't think they're there yet, basically based on
Speaker 3: the theory that they can corner the market by consistently
Speaker 3: kind of out innovating themselves in the race for these
Speaker 3: hot obesity medicines that everybody talks about. So to the
Speaker 3: news today, they had pivotal data from a late stage
Speaker 3: study showing that their pill and oral treatment looks like
Speaker 3: it works about as well as the injectable ozembic made
Speaker 3: by its rival Novo Nordisk, at least in patients who
Speaker 3: have type two diabetes. And this was closely watched because
Speaker 3: despite it being a relatively smaller study and it being
Speaker 3: diabetes and not obesity, everybody is looking at the read
Speaker 3: through of what is the weight loss them And if
Speaker 3: this is a pill that you take once a day, hallelujah,
Speaker 3: they can do what a weekly injection can do. That
Speaker 3: is again like a holy grail product in this market.
Speaker 4: A couple things you said, it's not yet a trillion
Speaker 4: dollar company they want to be. It's eight hundred and
Speaker 4: eleven billion dollars. That's acap right now. Today's move higher,
Speaker 4: whopping sixteen percent a pill versus an injection, And look,
Speaker 4: I don't like needles. A lot of people don't like needles.
Speaker 4: Paul Sweeney was on earlier today talking on Bloomberg Intelligence,
Speaker 4: talking about surveillance. He says he's administered this shot. He
Speaker 4: says it's no big deal. His question was more about
Speaker 4: what about side effects here? That seems to be more
Speaker 4: of a barrier, at least in his experience.
Speaker 3: That's true so for people who can get over the
Speaker 3: needle aspect, which is definitely true for people who have
Speaker 3: type two diabetes, and we're finding out based on the
Speaker 3: demand for these medicines that it's true for people who
Speaker 3: want to lose weight as well. The side effect issue
Speaker 3: is all gastro intestinal, or at least those are the
Speaker 3: most common and the most That's what yes vexing for people.
Speaker 3: So looking and again this is something scientists say never
Speaker 3: to do. And dude, anyway, a cross trial comparison, which
Speaker 3: is looking at Lily's data and comparing it to what
Speaker 3: we saw with those empics published data, I would say
Speaker 3: they're relatively comparable. The rates of you're talking about vomiting, diarrhea,
Speaker 3: I apologize, so maybe this is not the toat we
Speaker 3: usually shoot for on this show, and nausea. In some
Speaker 3: cases they were a little higher with Lily's pill. In
Speaker 3: some cases they were higher with the injections. But I
Speaker 3: think the reaction right now is that they look pretty similar.
Speaker 3: But I guess that could end up being the barrier
Speaker 3: in the future if and when this product's approved and
Speaker 3: we kind of remove the needle aspect, it's are you
Speaker 3: comfortable being one of the ten to fifteen percent of
Speaker 3: people who experience those side effects.
Speaker 2: Because I do I know of people who've like moved
Speaker 2: around because they have really bad side effects from certain drugs.
Speaker 2: They're not necessarily apples to apples. There's there's some variances.
Speaker 2: I mean, Novo's down about seven percent. Should Novo be worried.
Speaker 3: Yes, I mean there's an argument that so Lily and
Speaker 3: Novo have been the two giants of this market, Novo
Speaker 3: being based in Denmark, Lily being based in Indiana, and
Speaker 3: they've both been focused on diabetes for I mean, in
Speaker 3: Lily's case, more than one hundred years, dating back to
Speaker 3: like the initial synthesis of insulin, and so they've been
Speaker 3: fighting one another in this place for basically the entirety
Speaker 3: of their corporate histories. These data today and Lily's trajectory.
Speaker 3: Maybe this is unfair, but it feels like they have
Speaker 3: kind of out gamed Novo in this market. Nova has,
Speaker 3: you know, the major product in the form of ozempic,
Speaker 3: but Lily has an injectable medicine that works a little
Speaker 3: bit better than ozempic and now appears to be knocking
Speaker 3: on the door of having a pill.
Speaker 4: What's the next you know, when we think about pipelines,
Speaker 4: this stuff takes years. That's why the startup biotech companies
Speaker 4: are so volatile. If we're thinking about the pipeline, a
Speaker 4: pill is sort of the next iteration, that's the golden goose,
Speaker 4: That's what people are going for. What's next after that?
Speaker 3: So it's interesting because everybody has kind of differentiated You just.
Speaker 2: Breathe in, you spray something and just really no, I'm
Speaker 2: just kidding, that's a mist would not be so bad.
Speaker 3: Not impossible, I think scientifically as well. But barring the
Speaker 3: you know, aerosolization of GLP one kids, I don't think
Speaker 3: we're there yet. Okay, So both Lily and Novo and
Speaker 3: a few other companies including Astrozenca are kind of moving
Speaker 3: in parallel tracks where there is the move to develop
Speaker 3: oral medicines that might lead to a little less weight
Speaker 3: loss but would be more accessible and were able to
Speaker 3: produce and cheap to produce. And then there's a next
Speaker 3: generation of injectables that appear to, at least so far,
Speaker 3: have even stronger effects on body weight, So twenty to
Speaker 3: twenty five percent body weight loss versus the smaller numbers
Speaker 3: we see and the theory is that by let's say
Speaker 3: the end of the decade, if all these things work,
Speaker 3: it would be kind of like an armamentarium for people
Speaker 3: looking for treatments. For people who have obesity such that
Speaker 3: losing twenty five percent of their body weight is medically
Speaker 3: necessary for their health, you would have the kind of
Speaker 3: like big guns. This is all a little crude, but
Speaker 3: the more efficacious injectable treatments. And then for people for
Speaker 3: whom a smaller percentage body weight treatment is more desirable,
Speaker 3: or who perhaps just need to maintain loss that they
Speaker 3: got from one of those drugs, you would have the pills.
Speaker 2: So kind of a menu of drugs. Right. Essentially, Hey, Eli,
Speaker 2: Lily is the top gainer in the s and P
Speaker 2: five hundred. United Health is the top decliner. I just
Speaker 2: we've got you got to ask. Stocks down like twenty
Speaker 2: three percent. Here they cut its annual forecast and reported
Speaker 2: its first earnings missing over a decade. What do we
Speaker 2: need to know about this? Is this also an industry
Speaker 2: wide problem because it dragged down the group Today.
Speaker 3: It does seem like it. The word ominous has been
Speaker 3: invoked a few times now. United Health is difficult to
Speaker 3: crosscut because they are this like octopus of healthcare. They
Speaker 3: do everything, sort of developed their own medicines, but in
Speaker 3: terms of insurance managed care, they are a you know,
Speaker 3: arguably kind of monoymous. Yeah, and so, but in that
Speaker 3: sense they are perceived as a bellweather. So they report earnings,
Speaker 3: they have this unforeseen issue with their profitability relating to
Speaker 3: Medicare advantage or sort of a supplementary insurance program. And
Speaker 3: I think part of the ominous nature of that is
Speaker 3: the thing they're suffering from is from basically a government
Speaker 3: crackdown on how Medicare advantage works that began last year.
Speaker 3: And you might think that that would alleviate under a
Speaker 3: new administration, but doctor oz memet Oz, who is stepping
Speaker 3: into the role of leading the federal agency that runs Medicare,
Speaker 3: was very fiery in his Senate confirmation hearing about exactly
Speaker 3: this issue. And so I think some of the stock
Speaker 3: reaction is not just the shock of, as you mentioned,
Speaker 3: the superlative of United missing earnings for the first time
Speaker 3: in a decade, but also that like the storm clouds
Speaker 3: seem to just still be on the horizon.
Speaker 2: Yeah, storm clouds over another industry is what a kind
Speaker 2: of feels like what.
Speaker 4: He can talk about anything. Damian Guardia can talk about anything.
Speaker 4: It's like he's been writing about Lily all day and
Speaker 4: you throw him the United Health question and he knocks
Speaker 4: it out of the park.
Speaker 2: Thank you so much.
Speaker 3: Time we can talk about doctor Oz.
Speaker 4: Thanks for joining us.
Speaker 2: Blimberg News healthcare reporter Damian Guardi