In Big Pharma's growth rankings, Lilly took top spot from Novo Nordisk in Q1

The momentum the biopharma industry showed in the fourth quarter of 2023 has continued into this year. With 18 of the industry’s top 25 companies achieving year-over-year revenue gains, the first quarter of 2024 nearly matched the final quarter of last year, when 21 of the industry's top 25 companies posted sales increases.

Additionally, nine companies realized double-digit growth in the first three months of this year, which was one more than in the previous period.

Once again, the dominant players were the sellers of GLP-1 diabetes and obesity drugs. While Novo Nordisk dropped out of the top spot with its 22% year-over-year revenue increase, Eli Lilly took over as No. 1 thanks to its 28% quarterly boost.

Lilly may hold the top spot for a while. Last month, GlobalData projected Lilly’s Mounjaro will overtake Novo’s Ozempic as the top blood sugar-modulating treatment, generating staggering sales of $34 billion by 2029.

“Mounjaro’s novel dual mechanism not only underscores its clinical value but also its potential to become the top-selling drug in its category,” Eleni Tokali, pharma analyst at GlobalData, said in a release. “Mounjaro’s projected growth rate signifies a potential shift in market dynamics in Eli Lilly’s favor.”

While Novo’s older GLP-1 medicines outsold Lilly’s by a margin of better than 2 to 1, the momentum appears to be on Lilly’s side.

In the first quarter, while Ozempic generated sales of $4.3 billion, good for a 35% growth rate, Mounjaro brought in $1.8 billion, triple its haul from the first quarter of 2023.

As for the companies’ obesity follow-on treatments, Novo’s Wegovy pulled in $1.3 billion, a 107% increase, while Lilly’s Zepbound accounted for $517 million in sales in its first full quarter on the market.

While Novo’s 22% growth rate put it among the top companies in the industry in the first quarter, it was a decline from the gaudy 37% growth rate it enjoyed in the previous quarter. Novo’s 65.3 billion Danish kroner ($9.4 billion) in the first quarter also was a slight decline from the 65.9 billion Danish kroner the company achieved in the previous quarter.

It was the first sequential drop for Novo since the second quarter of 2022, indicating it is not scaling up its manufacturing quickly enough to meet the overwhelming demand for semaglutide. The company hopes to remedy that with its acquisition of three plants from CDMO giant Catalent.

Lilly’s edge came despite its own manufacturing challenges that are limiting its ability to meet the demand for its diabetes and obesity drugs.

“Both Mounjaro and Zepbound are expected to remain supply-constrained as growing volume production is overwhelmed by building wholesaler backorders and increasing demand,” Third Bridge analyst Lee Brown recently wrote.

Double-digit gainers

Seven other companies—including three from Japan—realized double-digit growth in the first quarter, though there were asterisks next to a few of them.

While revenues for Daiichi Sankyo were up by 25%, much of the boost can be attributed to the company’s sale of three antibody-drug conjugate (ADC) investigational treatments to Merck for $4.5 billion upfront. Daiichi is deferring the payments and booking them as revenue. Last year as a result of the deal, Daiichi jacked up its projection of 2024 revenue by 100 billion Japanese yen ($662 million).

Another Japanese firm, Astellas, saw a 17% revenue increase in the quarter, though part of the gain can be attributed to geographic atrophy treatment Izervay. Astellas acquired the drug last year in the company’s largest-ever M&A deal, a $5.9 billion buyout of Iveric Bio.

Amgen’s sales were up 22% from the first quarter of 2023. But of the firm's $1.3 billion year-over-year revenue bump, $914 million can be chalked up to products gained in the company’s buyout of Horizon Therapeutics.

Companies that achieved mostly organic double-digit growth were AstraZeneca (17%), Vertex (13%), Takeda (10%) and Novartis (10%). AZ and Vertex also showed their momentum with sequential revenue increases of 6% and 7%, respectively.

AstraZeneca was boosted by its wealth of blockbusters that are in their prime, including heart treatment Farxiga, rare disease drug Ultomiris and cancer therapies Calquence, Imfinzi and Tagrisso. Vertex continues to climb behind its cystic fibrosis drugs while laying the groundwork for the launch of sickle cell disease gene therapy Casgevy.

Single-digit gainers

Several giants of the biopharma industry are among the companies that posted single-digit revenue increases in the first quarter, including Merck (9%), GSK (6%), Bristol Myers Squibb (5%), Gilead (5%), Teva (4%), Sanofi (2%), Johnson & Johnson (2%) and AbbVie (1%).

Merck’s rise paralleled the continued growth of mega-blockbuster Keytruda, which was up 20% to $6.9 billion in the quarter. Meanwhile, HPV vaccine Gardasil was up 14% to $2.2 billion. Together, the two products accounted for 58% of the company’s revenue of $15.9 billion for the quarter.

GSK and J&J showed growth after a year in which they shed their consumer health units in an industry trend where companies are becoming increasingly focused on their prescription drug units.

Gilead’s 5% increase came after it was down 4% in the previous quarter, owing largely to an 18% boost in its oncology products and a 9% increase in its liver disease portfolio.

On the downside, in addition to reporting its revenue increase, BMS also revealed a massive cost-cutting plan in which it will lay off more than 2,000 employees. The news came months after the company pulled off pricey acquisitions of Mirati, Karuna and RayzeBio in an M&A splurge.  

Seven in decline in Q1

Of the companies that saw sales declines in the first quarter, the new surprise member is Regeneron, which had a 1% drop despite the continued growth of Dupixent. The decline for the New York biotech is due largely to a drop in sales for eye disease treatment Eylea.

The company’s Eylea partner Bayer also was down by 3% in the period, continuing a trend for the troubled German company which is undergoing a massive restructuring under CEO Bill Anderson.

With quarterly sales falling by 19%, Pfizer was the only company in the industry that sustained a double-digit decrease in the first quarter. The fall, of course, is due to declining demand for its COVID products. That effect should now be in the rear-view mirror, the company said.

There were plenty of positive numbers for Pfizer as its $14.9 billion revenue haul was $1 billion higher than the analyst consensus. It also was the third straight quarter in which Pfizer had a sequential revenue increase. Excluding sales of COVID products, the company was up 11% in the most recent quarter.

Two other companies that saw sales declines in the quarter—Roche at 6% and Merck KGaA at 5%—also chalked it up to the loss of revenue from COVID products and related services. Roche’s drop came despite skyrocketing sales of its eye disease treatment Vabysmo, which has quickly taken market share from Eylea.

Other companies that suffered revenue declines were Biogen, at 7%, and Viatris at 2%. With sales falling for its multiple sclerosis products, Biogen sees the trend continuing in 2024 as it is projecting an annual revenue decline for the fifth straight year.

Viatris’ decline also reflects an overall trend for the company which has seen annual revenues fall each year since 2021 when it was formed by merging generics powers Mylan and Upjohn.