Riding Q4 diabetes growth, Lilly aims for even more with Jardiance

It was a "very quiet quarter overall" for Eli Lilly & Co. ($LLY), in the words of Bernstein analyst Tim Anderson. But the company expects things to get plenty more exciting if its diabetes med Jardiance wins a label change, an event it's anticipating for the second half of this year.

Q4 revenue for the Indianapolis drugmaker grew 5% year-over-year to hit $5.38 billion, a mark that met analyst expectations, despite a 6% currency hit, Lilly said. The company measured a 7% volume increase and a 3% price increase, and it had a ramp-up in its diabetes brands to thank for the former. Diluted EPS came in at 78 cents to hit Wall Street's forecasts, too.

Within the diabetes category, brand-new Trulicity made a huge leap to net $12.5 million for the quarter, while Tradjenta climbed 23% to $101.7 million. Long off-patent Humalog jumped 10%, too, an event company diabetes president Enrique Conterno described as "remarkable, given all of the new launches that we have ongoing." U.S. price increases largely powered that gain, the pharma said in a statement, with volume chipping in "to a lesser extent."

Eli Lilly diabetes president Enrique Conterno

The way Lilly sees it, it won't be long before Jardiance joins its diabetes peers in rocketing its way up the sales charts. Earlier this week, the company announced that the FDA had accepted its bid to add cardiovascular outcomes data--which made it the first med to show it could cut risks in major CV events--to the product's label. It has submitted an application to do the same in Europe. And if it can snag the label updates, Conterno is "pretty confident that different [disease and medical] societies will have a thorough review of the different treatment guidelines," he told investors on the company's earnings conference call.

Any move by bodies such as the American Diabetes Association (ADA) could go a long way for Jardiance. Some major payers have said they're waiting for guideline updates before they ease access to the $4,800-per-year therapy. But even with the label change alone--which will allow reps from Lilly and partner Boehringer Ingelheim to start touting the CV benefit to doctors--Conterno said he expects to see a "very significant impact on the overall trend of Jardiance" and the SGLT2 class in general.

"We think that is going to make a huge difference when we have the label," he said.

And the company may not be stopping at diabetes when it comes to Jardiance, which posted a 38% reduction in cardiovascular death in the outcomes study, dubbed EMPA-REG.

"Clearly the data … was very impressive," Conterno noted. "You can imagine that we are actively exploring and thinking about this very important opportunity for the brand."

The drugmaker can use any revenue bump it can get from Jardiance as it recovers from recent patent expirations on big sellers Cymbalta, an antidepressant, and Evista for osteoporosis. Earlier this month, Lilly laid out top-line guidance of $20.2 billion to $20.7 billion for the year, missing analysts' $21.37 billion prediction.

- here's the release (PDF)

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