Alzheimer’s could be a ‘very big category’ for Eli Lilly: former FDA commissioner

Alzheimer’s could eventually be a “very big category” for Eli Lilly & Co (NYSE: LLY), says Dr Scott Gottlieb. He’s the former commission of the U.S. Food & Drug Administration.

FDA advisors vote in favour of Lilly’s donanemab

Lilly received backing for its Alzheimer’s drug from a panel of advisors to the FDA on Monday.

It’s an “important development for patients” because donanemab is more efficacious and required just one dose per month versus two for a similar drug from Biogen, Dr Gottlieb added in an interview with CNBC today.

Still, Biogen has called its Alzheimer’s drug that targets tau proteins the “crown jewel of the organisation”. J&J also expects its similar under development drug to eventually bring in “$5.0 billion a year”.

That’s why Dr Gottlieb is positive on what the Alzheimer’s treatment may mean for Eli Lilly & Co moving forward.

Eli Lilly is committed to Alzheimer’s treatment

Dr Scott Gottlieb was all praise for Eli Lilly’s donanemab on Monday because it’s a treatment for the “underlying biology of [Alzheimer’s] disease” and not just its symptoms. That helps “prevent progression”, he noted.

Note that the healthcare behemoth is working on a second-gen Alzheimer’s drug as well. It’s scheduled to report data for that subcutaneous treatment in 2025.

The former FDA commissioner expects subcutaneous treatments to be used much more broadly as they will not need to be administered under strict medical supervision.

Wall Street currently has a consensus “buy” rating on Eli Lilly stock that pays a dividend yield of 0.60% at writing.

What’s next for $LLY in Alzheimer’s space?

Dr Gottlieb talked of the need to win FDA approvals for Alzheimer’s drugs to be administered in the early-stage of the disease on Monday.

He touched on potential for donanemab (or its follow-on formulations) to be an even bigger benefit for $LLY if it makes its way to Medicare coverage as well.

Eli Lilly saw its revenue come in shy of Street estimates in its latest reported quarter. Still, it raised its guidance for the full year to well above expectations in April (read more). David A. Ricks – chief executive of the New York listed giant said at the time:

Eli Lilly stock is currently up roughly 45% versus the start of 2024.