Eli Lilly (LLY) PT Lowered to $1,050 at UBS

UBS analyst Trung Huynh lowered the price target on Eli Lilly (NYSE: LLY) to $1,050.00 (from $1,100.00) while maintaining a Buy rating.

The analyst commented, "A solid fundamental 1Q25 performance from LLY was overshadowed by: (1) increasing concerns over pricing of the GLP-1 class, stimulated by this morning's announcement from Novo that CVS Caremark will prioritize Wegovy ahead of Zepbound on its formularies, (2) lower expectations from the company for orfo obesity (benchmarking against SURMOUNT-5 -13.7% weight loss vs. c.15-16% expectations, (3) Withdrawing of tirzepatide's HFpEF indication, and (4) a Tech-on, Healthcare-off rotation. The stock touched -11%. While we understand some of these concerns, we think this is an overreaction based on: (1) Covered lives on CVS Caremark is low (we think 1.6m people from UBS Evidence Lab analysis), additionally management reaffirmed its group mid tohigh single-digit price erosion, (2) We think the company could be sandbagging ATTAIN expectations. The SURMOUNT-5 study is an open-label trial. We think sema's STEP-1 study is also an appropriate comparator, which showed 14.9% weight loss over 68 weeks, (3) All the patients in the HFpEF indication are already covered by the obesity indications, and there could be a way to use other subgroup data (perhaps from upcoming CVOT studies) to resubmit for this indication at a future date."

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