On Friday, Bernstein SocGen Group maintained its Outperform rating and $1,100.00 price target for Eli Lilly (NYSE:LLY), following the FDA’s completion of their report on the availability of Tirzepatide, a drug marketed under the names Mounjaro and Zepbound. The FDA has confirmed that these medications are no longer in shortage, which is a positive development for the pharmaceutical company.
The FDA has also indicated that it will not take action against compounders for selling state-licensed pharmacy compounded tirzepatide for the next 60 days, until February 18, 2025, and for outsourced facilities under section 503B for 90 days, until March 19, 2025. However, the agency reserves the right to intervene during this period if safety or quality issues arise.
According to Bernstein SocGen Group, this development signals a winding down of the period where compounders have been actively involved in the production of tirzepatide. The analyst’s perspective suggests that while this may conclude the heightened activity of compounders, it is not expected to significantly affect Eli Lilly’s tirzepatide volumes for the year 2024. Any potential benefits from this development are anticipated to be modest and more likely to be seen in 2025.
Eli Lilly’s stock rating and price target reaffirmation by Bernstein SocGen Group follows the FDA’s update on the drug’s supply status. The FDA’s decision not to pursue action against compounders in the short term provides a window of continued availability of compounded tirzepatide, albeit with the potential for regulatory oversight on safety and quality grounds.
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