Eli Lilly & Co. (NYSE:LLY) has intensified its fight against counterfeit versions of its popular obesity drug, Zepbound, by initiating additional legal proceedings against companies selling compounded versions of the medication.
What Happened: The pharmaceutical company filed several new lawsuits on Thursday against various establishments, including medical spas and wellness centers, for promoting their products using Lilly's brand names, Mounjaro and Zepbound, reported Bloomberg. The company accused these businesses of trademark violations, false advertising, and unfair competition.
Lilly has initiated 11 legal actions, alleging trademark violations, false advertising, and unfair competition. These lawsuits target companies selling counterfeit drugs under the names tirzepatide, which is the generic name for Mounjaro, and Zepbound.
The U.S. regulators permit pharmacies to produce copycat versions of drugs that are in short supply, a practice known as compounding.
Lilly highlighted concerns about potential counterfeit products linked to tirzepatide, mentioning issues with safety, sterility, and efficacy. Some of these products reportedly contained bacteria, and impurities, or differed significantly from Lilly's FDA-approved medication.
"In at least one instance, the product was nothing more than sugar alcohol," the company said.
Why It Matters: This latest development comes after a series of strategic moves by Lilly to address the growing demand for its weight-loss and diabetes medications. In April, the company acquired a manufacturing facility from Nexus Pharmaceuticals to close the supply-demand gap for Zepbound and Mounjaro.
In May, it made its largest manufacturing investment in history to boost production for antidiabetic and weight-loss meds.
Despite these efforts, the company has been facing challenges from counterfeit versions of its drugs. In May, Lilly reached a settlement agreement with a medical spa that sold counterfeit versions of Mounjaro and Zepbound. The spa agreed to pay a monetary settlement and cease using Lilly's branding to promote its products.
These developments are significant in the context of the broader pharmaceutical industry. According to a report by Goldman Sachs, the global sales of weight-loss drugs are expected to reach $130 billion by 2030, with companies like Eli Lilly and Novo Nordisk (NYSE:NVO) leading the market.
Price Action: Eli Lilly And Co's stock last closed at $891.46, up 0.73% for the day. In pre-market trading, the stock dipped 0.16%, according to data from Benzinga Pro.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote