Eli Lilly’s quarterly revenue jumps 15% as customers stockpile drugs ahead of COVID-19 restrictions

Eli Lilly and Co (NYSE: LLY) released its quarterly earnings report on Thursday that topped analysts’ estimates for earnings and revenue. The company attributed the success to higher sales as customers stockpiled essential medicines like Trulicity (diabetes drug) to prepare for the Coronavirus driven lockdowns.

The American pharmaceutical company also raised its guidance for 2020 profit on Thursday.

Lilly said it saw a £202 million increase in its revenue in the first quarter ascribed to higher sales of Trulicity and Taltz (Psoriasis drug). The company, however, expects the increase in revenue to be reversed later this once the virus subsides and stockpiling stops.

Lilly’s Revised Earnings Guidance For 2020

The company also said on Thursday that its newer drugs are also in great demand as it raised the upper-end of its guidance for full-year profit (adjusted) by 8 pence. Eli Lilly now estimates £5.43 to £5.59 of earnings per share in 2020.

The pharmaceutical company acknowledged the impact of Coronavirus on delaying its ongoing clinical trials but expressed confidence that the trials will be back on track in the 2^nd half of 2020.

According to Eli Lilly, 40% of its customers are commercially insured while 10% are enrolled in Medicaid. The rising unemployment in the U.S due to COVID-19, the drug manufacturer added, is likely to increase the number of its customers that are either covered by a federal program or are uninsured. In such a case, CEO David Ricks of Eli Lilly commented, payments for the company’s drugs are likely to plunge sharply. Ricks also added that the unemployment driven hit to the company is like to be more pronounced next year.

Earlier in April, Lilly slashed the insulin-related out-of-pocket expense to £28/month for diabetes patients in the U.S.

Lilly Is Testing Olumiant As A Potential COVID-19 Treatment

The American pharmaceutical company is currently testing Olumiant (rheumatoid arthritis drug) as a potential cure for COVID-19. Its experimental biotech drug is also being tested in Pneumonia patients.

At £4.75 billion, Lilly’s quarterly revenue came in 15% up as sales for its diabetes drug, Trulicity, increased by 40% in the recent quarter to £1.0 billion. Analysts had forecast the company to print £4.46 billion in revenue in the first quarter.

On the earnings front, the company made £1.42 per share (excluding items) in Q1 that beat experts’ estimates of 22 pence per share.

At £130 per share, Eli Lilly is currently over 20% up year to date in the stock market. The pharmaceutical company is currently valued at £125 billion and has a price to earnings ratio of 32.51.