Eli Lilly and Co. (LLY, Financial) shareholders got an early Christmas gift Tuesday when shares of the Indianapolis-based pharma giant climbed more than 6% to $167.43. The company had plenty of cheer to spread around, announcing it received two Food and Drug Administration emergency use authorizations for Covid-19 therapeutics that will add between $1 billion and $2 billion in sales this year alone. And there's more.
In a news release, the company said it is also seeing strong demand for several of its mainstay products, such as diabetes drug Trulicity, psoriasis medication Taltz and breast cancer treatment Verzenio.
For the full year, Eli Lilly now expects sales to be between $24.2 billion and $24.7 billion, and earnings per share to be in the range of $6.28 to $6.48 on a reported basis.
Revenue in 2021 is expected to be between $26.5 billion and $28 billion, driven by volume growth from key products and another contribution of $1 billion to $2 billion from Covid therapies.
To pave the way for an even brighter future, Eli Lilly also announced that it was spending $1 billion to acquire Prevail Therapeutics Inc. (PRVL, Financial), a gene therapy company in early tests to treat Parkinson's and neuronopathic Gaucher disease, and another gene therapy for frontotemporal dementia. Prevail stock jumped $10.25 to $22.75 on the news.
BioSpace reported Mark Mintun, vice president of pain and neurodegeneration research at Eli Lilly, called gene therapy a promising approach to treating disease and said the acquisition of Prevail will bring the company's expertise under its umbrella. Prevail will be a cornerstone of the company's new gene therapy program that Eli Lilly seeks to advance through clinical development, he added.
In November, Eli Lilly demonstrated its commitment to developing treatments that edit genes within the body by inking a deal with Precision BioSciences Inc. (DTIL, Financial). The partnership, according to a FierceBiotech article, will focus on developing gene therapies for three targets, starting with Duchenne muscular dystrophy. If everything falls into place, this pact could be worth $2.6 billion.
Investors also had to be pleased that the company is raising its quarterly dividend for 2021 by 15% to 85 cents.
Eli Lilly is also striving to become a top provider of cancer treatments. Toward that end, the company revealed at this month's annual meeting of the American Society of Hematology that it will begin two late-stage clinical trials next year comparing a drug it acquired in last year's purchase of Loxo Oncology against Imbruvica. The latter, sold in the U.S. by AbbVie Inc.(ABBV, Financial), is used to treat a common type of leukemia as well as several forms of lymphoma. Imbruvica sales were nearly $4 billion in the U.S. last year.
Disclosure: The author holds positions in Eli Lilly and AbbVie.
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