1 Incredible Reason to Buy LLY's Stock in November

Eli Lilly's tirzepatide (Mounjaro/Zepbound) has emerged as the world's best-selling drug, achieving $24.8 billion in year-to-date sales by Q3, primarily for type 2 diabetes and weight loss. A recent deal with the 'Trump administration' will provide discounted GLP-1 weight loss drugs to Medicare recipients, significantly expanding market access for Lilly and Novo Nordisk and potentially reaching millions of eligible individuals. This strategic expansion into government-funded healthcare programs positions Lilly, a leader with 57% market share in the weight-loss sector, to further capitalize on a market projected to exceed $200 billion annually by 2031.

Analysis

Eli Lilly's tirzepatide (Mounjaro/Zepbound) has become the world's best-selling drug, achieving $24.8 billion in year-to-date sales by Q3, surpassing Merck's Keytruda. This strong performance, known since October 30th, highlights Lilly's dominant position in the GLP-1 market for type 2 diabetes and weight loss. The company holds a significant 57% market share in the weight-loss drug segment.

A recent deal with the "Trump administration" on November 6th is set to significantly expand market access for Lilly's GLP-1 drugs, including Zepbound, to Medicare recipients. This agreement, involving discounted pricing in exchange for expanded Medicare coverage and "most-favored nation" status, targets millions of eligible seniors. With 68 million Medicare enrollees, this strategic move provides a substantial new channel for growth.

The deal is expected to lower the cost of Lilly's forthcoming weight-loss pill, orforglipron, to as little as $150, making it more accessible. The overall GLP-1 market for non-diabetic uses has surged 700% since 2019 and is projected to exceed $200 billion annually by 2031 from $52 billion last year. Furthermore, GLP-1 drugs are being explored for additional indications like Parkinson's and Alzheimer's, suggesting sustained long-term growth potential.

Key Decisions for Investors

• Investors should assess Eli Lilly's strengthened market leadership in the rapidly expanding GLP-1 sector, driven by the strategic Medicare deal and its dominant 57% weight-loss drug market share.
• Monitor the implementation and patient uptake rates of discounted GLP-1 drugs through Medicare and Medicaid, as these will be crucial indicators for realizing the full revenue potential from expanded access.
• Evaluate the long-term growth trajectory of the GLP-1 market, considering potential new indications beyond diabetes and weight loss, which could further diversify Lilly's revenue streams.
• Consider the potential for political shifts or regulatory changes that could impact future government pricing agreements, alongside competitive dynamics from rivals like Novo Nordisk.