Eli Lilly and Co., which has launched 19 drugs in the past nine years, helping it recover from a dry spell in which it lost patent protections on its top products more than a decade ago, became the most valuable publicly-traded drugmaker in the world on Wednesday.
The Indianapolis-based company’s market capitalization climbed to $412.2 billion in midday trading, surpassing New Brunswick, New Jersey-based Johnson & Johnson, a company more than three times Lilly’s size in revenue, whose market cap was $411.3 billion.
Market cap represents the total value of a publicly traded company’s outstanding common shares. It is calculated by multiplying the share price by the number of shares outstanding.
Lilly’s stock was trading at $436.09 per share Wednesday, near its all-time high of $445.54 earlier this year.
Lilly shares have soared 57% over the past 52 weeks, buoyed in part by sales of its diabetes drug Mounjaro, which the company is also preparing to seek approval to market for obesity. The drug, launched last year, rang up sales of $568 million in the first quarter, putting it on pace to become a blockbuster (or annual sales exceeding $1 billion) by mid-year.
The company expects to seek permission later this year to market donanemab for Alzheimer’s disease, another huge potential market.
Lilly shares have remained above $300 a share since last summer, after spending most of their history below $100. Several analysts say Lilly shares are not through with their sizzling hot spell. Evan David Siegerman, analyst at BMO Capital Markets, said he expects Lilly shares to hit $505 within a year.
Lilly last year overtook the world’s largest drugmaker, Pfizer Inc., in market cap, even though Pfizer (maker of blood thinner Eliquis, autoimmune drug Enbrel, arthritis medicine Xeljanz and others) with revenue of $100.3 billion, is nearly four times as big as Lilly.
Pfizer’s market cap on Wednesday was $206.5 billion, far below Lilly’s.
Johnson & Johnson, maker of cancer drug Darzalex and immunology blockbuster Stelara, is the second-largest drugmaker in the world, with revenue last year of $94.9 billion. That includes sales of medical devices and consumer health care products.
Lilly, by comparison, is the 12th largest drugmaker in the world, with sales last year of $28.5 billion. Its products include diabetes drugs Trulicity, Humalog and Humulin; cancer drugs Verzenio and Cyramza; pain medicine Emgality; and immunology drug Taltz.
Other large publicly traded drugmakers include Swiss-based Roche AG, New Jersey-based Merck & Co., Illinois-based AbbVie and Swiss-based Novartis.
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Just an amazing turnaround. Ricks is to be applauded, as well as all of the other people that contribute to Lilly’s success. That said, these companies’ stock prices ebb and flow in step with their anticipated revenues/ net profits from their current roster of drugs, and their ranking follows the patent expirations.