Lilly falls short on Q1 EPS, but diabetes newcomers keep revenue in line


Once again, Eli Lilly’s diabetes brands grew for the quarter to help keep its revenues in line with expectations. But the company’s spending grew, too, dragging Q1 EPS below analyst forecasts.

The Indianapolis drugmaker posted non-GAAP EPS of 83 cents, falling just short of the 85 cents Wall Street predicted. It had higher operating expenses to blame--though those were offset by a lower-than-expected tax rate of 17.9%, which kept the shortfall to a minimum.

Revenues, though, hit their spot, checking in at $4.86 billion to surpass the $4.84 billion consensus estimate. That haul represents a 5% increase over last year’s Q1 total, and the company had a crop of new products--which generated $325 million in revenue between them, CFO Derica Rice told shareholders on a conference call--to thank for the increase.

Most of those fell into the diabetes portfolio, with GLP-1 med Trulicity, SGLT2 product Jardiance and long-acting insulin Basaglar all chipping in. Trulicity drummed up $143.6 million in Q1 sales to top expectations of $119 million, while Jardiance--closely watched since it last year became the first diabetes med to lower cardiovascular events in high-risk Type 2 patients--beat on revenue in the U.S., where it posted $29.7 million.

Lilly attributed the Trulicity and Jardiance performances to increased market share for each med--a positive sign considering the hefty competition in both the GLP-1 and the SGLT2 fields. Trulicity’s total share of the GLP-1 field is 17% and growing, and it’s now the second-most-prescribed product in its class, Rice noted. As for Jardiance, its new-to-brand share approached 30% in Q1, nearly doubling what it was last year.

The one diabetes downside for the pharma giant: Humalog, which underperformed forecasts by $100 million to hit $606.3 million for the quarter. That slide measured an 11% decrease over last year’s Q1 total--and a 14% decrease in the U.S.--driven by lower realized prices, Lilly said. But it doesn’t expect that trend to continue all year.

All things considered, Lilly saw it fitting to tweak its guidance slightly. It now think’s it’ll end the year with sales in the $20.6 billion to $21.1 billion range, up from the $20.2 billion to $20.7 billion it earlier predicted.

- read Lilly's release 

Special Report: The top 15 pharma companies by 2014 revenue - Eli Lilly 

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