Eli Lilly and Co's oral weight loss drug Orforglipron has performed exceptionally well in Phase III clinical trials, capable of rivaling or even surpassing injectable GLP-1 drugs.

The market has reacted strongly to Eli Lilly and Co's breakthrough progress. On April 17th, Eli Lilly's stock price closed up over 14%, soaring 16% during trading, marking the largest single-day gain since August 2023.

At the same time, long-term dominant player in the GLP-1 market$Novo-Nordisk A/S (NVO.US)$saw its stock price significantly drop by nearly 8%.

According to a press release from Eli Lilly and Co, its oral GLP-1 drug Orforglipron "demonstrated statistically significant efficacy results in Phase III clinical trials, with safety consistent with that of injectable GLP-1 drugs."

Data shows that participants taking Orforglipron lost an average of 16 pounds after 40 weeks, which is about 7.9% of their body weight, surpassing Eli Lilly and Co's previous expected weight loss range of 4% to 7%.

In contrast, Novo-Nordisk's star product Ozempic only reduces approximately 6% of body weight in diabetic patients at the highest dose.

"These data represent the best-case scenario for a blockbuster product right after its launch," said Jefferies Analyst Akash Tewari.

Jared Holz, a Healthcare Expert at Mizuho Securities, stated that Eli Lilly and Co will maintain its superior position in this category for quite a long time, as based on these data, its advantages over competitors in the pharmaceutical and Biotechnology sectors are expanding.

Wall Street Analysts generally believe that the GLP-1 weight loss medication field is transitioning from injectable forms to more convenient oral forms, and Eli Lilly and Co has already gained an early lead. This fierce, multi-year competition has clearly shown a winner; at least for now, Eli Lilly and Co has been crowned by the market as the new king in the realm of GLP-1 drugs.

David Ricks, Chairman and CEO of Eli Lilly and Co, wrote in a statement:

"As a convenient once-daily oral pill, Orforglipron may offer a new option, if approved, that can be rapidly produced and launched for Global use."

Oral medications: A dual victory of convenience and manufacturing advantages.

Orforglipron is a more convenient oral alternative to GLP-1 injectables, giving Eli Lilly and Co a potential advantage over competitors like Novo-Nordisk.

Eli Lilly and Co's Orforglipron is not only competitive in efficacy but also offers significant convenience advantages with its oral dosing method.

Reports indicate that while there are already GLP-1 drugs such as Wegovy achieving great success in the market, these drugs must be administered via weekly injections, which limits their usage.

If Orforglipron can provide similar effects in a simple oral form, it has the potential to reach more patients and become a significant market disruptor.

In addition to convenience, Eli Lilly and Co is also actively preparing for large-scale production of Orforglipron. The company recently disclosed inventory valued at nearly $0.55 billion, "primarily related to Orforglipron." This indicates that Eli Lilly and Co is building product inventory to avoid the supply shortage issues that Novo-Nordisk A/S and its own injectable GLP-1 drugs have faced.

David Risinger, an Analyst at Leerink Partners, stated: Eli Lilly and Co will be the only company with an easily producible oral GLP-1 drug, leading new competitors by nearly three years. This advantage will allow Eli Lilly and Co to maintain higher pricing power for a longer period.

Crowning the king of weight loss drugs?

According to previous reports from Wall Street, in the same week that Eli Lilly and Co announced this exciting news, its competitor $Pfizer (PFE.US)$announced the halt of development for its oral weight loss drug Danuglipron due to a potential drug-related liver injury observed in a patient during clinical trials. It was reported that Pfizer's exit further solidifies Eli Lilly and Co's leading position in this field.

Meanwhile, Novo-Nordisk A/S has faced a series of Bearish challenges since last June, including lower-than-expected demand for weight loss drugs Wegovy and Ozempic, disappointing mid-term trial results for the oral weight loss drug monlunabant, and poor data performance from another injectable drug in development, CagriSema, resulting in its loss of the top position in the European stock market this month.

The GLP-1 weight loss drug market is expected to grow rapidly from the current $28 billion to about $95 billion by 2030. According to forecasts from Goldman Sachs analysts, the risk-adjusted peak sales of Orforglipron (including obesity and diabetes) will reach $23.5 billion by 2035, far exceeding the market consensus of $16.8 billion.

To avoid supply shortage issues similar to those of injectable GLP-1 drugs, Eli Lilly and Co has started actively stocking Orforglipron, with recently disclosed inventory valued at nearly $0.55 billion 'primarily related to Orforglipron.' Reports indicate that the company plans to localize the entire supply of Orforglipron production in the USA within 5 years.

According to the clinical trial database, Eli Lilly and Co's main obesity trial is expected to be completed as early as July. The company plans to seek regulatory approval for weight loss indications later this year, and will apply for diabetes indications early next year. If all goes well, analysts expect the drug may gain FDA approval for market release as early as the first half of 2026.

Editor/Lee