On Tuesday, Jefferies maintained a Buy rating on Eli Lilly (NYSE:) shares and increased the price target to $853 from the previous $814. The firm’s optimism is rooted in the potential manageability of the drug orfoscerinib’s drug-drug interaction (DDI) profile. Eli Lilly has conducted and completed a number of DDI studies with CYP/P-gp substrates, suggesting that orfoscerinib’s DDI profile could be similar to that of danuglipron, which is known to be a weak CYP3A4/5 inhibitor.
The analyst also expressed confidence in orfoscerinib’s liver toxicity profile, which has shown only transient enzyme increases. This assessment is further supported by AstraZeneca (NASDAQ:)’s licensing of ECC5004, which is seen as a de-risking factor for orfoscerinib. Based on these evaluations, Jefferies has modeled a risk-adjusted peak sales (PS) forecast for orfoscerinib at approximately $14 billion, compared to the consensus estimate of $11 billion.
Eli Lilly has been actively researching and testing the safety and interactions of orfoscerinib to ensure its efficacy and manageability. The positive outlook from Jefferies reflects confidence in the drug’s market potential and the company’s ability to navigate the regulatory and development pathways successfully.
Investors and market watchers will likely monitor Eli Lilly’s progress with orfoscerinib closely, as it represents a significant part of the company’s pipeline with the potential to impact its future growth and market position. The revised price target by Jefferies serves as a reflection of the anticipated value orfoscerinib could bring to Eli Lilly.
The recent optimism from Jefferies surrounding Eli Lilly’s (NYSE:LLY) orfoscerinib is further complemented by the company’s robust financial metrics and market performance. According to InvestingPro data, Eli Lilly boasts a substantial market capitalization of $663.02 billion, reflecting its significant presence in the pharmaceutical industry. Despite a high price-to-earnings (P/E) ratio of 76.9 for the last twelve months as of Q4 2023, which suggests a premium valuation, the company’s revenue has shown impressive growth of 19.56% over the same period. This revenue growth is a testament to the company’s ability to expand its market reach and innovate in its product offerings.
InvestingPro Tips highlight Eli Lilly’s commitment to shareholder returns, as evidenced by its track record of raising dividends for 9 consecutive years and…