Moody's downgrades long-term ratings for Eli Lilly

Back to TopCommentsE-mailPrintBookmark and Share

Moody's Investors Service on Monday lowered the long-term ratings of Eli Lilly and Co. one notch, to A2 from A1, citing a wave of patent expirations the drugmaker faces in coming years.

The new rating is Moody's sixth-highest investment-grade rating.

Lilly will lose patents protecting key drugs such as its top seller, the antipsychotic Zyprexa, to generic competition. And recent setbacks in drug development and intellectual property litigation compound those problems, Moody's said in a prepared statement.

Moody's said the downgrade also reflects erosion in Lilly's global position as competitors have merged.

"Amidst a competitive landscape and high hurdles to drug approvals, Moody's believes that Lilly's near-term patent expirations pose a major strategic challenge," the ratings service said.

Moody's said last month it was placing the drug maker's long-term rating under review for a possible downgrade and it expected a one-notch downgrade.

It said Lilly's rating outlook is now stable; positive factors reflected in the new rating include a strong balance sheet and conservative financial profile, Moody's said.

The ratings service also affirmed Lilly's Prime-1 short-term rating, which was not under review.

Lilly shares closed Monday at $35.73 each, unchanged for the day.


Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
Subscribe to IBJ