Eli Lilly stock price forecast ahead of obesity drug approval

Eli Lilly & Co (NYSE: LLY) has rallied over the past three months but a Bank of America analyst says it’s not out of room to run just yet.

Lilly stock should be worth $500

Geoff Meacham raised his price objective on the pharmaceutical behemoth in a research note this morning to $500 – up another 20% from here.

He expects the Eli Lilly stock to benefit as demand escalates for its obesity drug (Tirzepatide) that helped patients lose 16% of their body weight in a recent clinical study.

Consumer/social media trends bolster our confidence in Tirzepatide’s commercial opportunity, as patients seem very interested in anti-obesity medications, regardless of the administrative modality.

Eli Lilly now expects FDA approval for its weight loss drug by the end of this year.   

Tirzepatide’s demand will increase

Geoff Meacham estimates demand for Lilly’s obesity drug to increase by 40% over the next seven years.

Mounjaro is not eligible for reimbursement under health insurance for now. But the BofA analyst is convinced that will change moving forward. All in all, he expects Tirzepatide to be a $20 billion drug by 2030.

In April, Eli Lilly & Co raised its outlook for the full financial year related partially to the weakening U.S. dollar. It now forecasts revenue to fall between $31.2 billion and $31.7 billion in fiscal 2023.

Earlier this month, famed investor Jim Cramer also dubbed the company’s Alzheimer’s drug a holy grail as Invezz reported here.