Could Donald Trump Make Eli Lilly Stock a No-Brainer Buy in 2025?

In the ever-evolving landscape of global politics and healthcare, one question has been on the minds of investors: could Donald Trump's policies make Eli Lilly (LLY) stock a no-brainer buy in 2025? As the former president's influence on the pharmaceutical industry continues to be felt, let's explore the potential impacts of his proposed tariffs and healthcare policies on Eli Lilly's long-term growth prospects.



Trump's proposed tariffs on Danish imports could significantly impact Eli Lilly's competition with Novo Nordisk, as Novo Nordisk's type 2 diabetes drug, Ozempic, and obesity drug, Wegovy, are primarily manufactured in Denmark. If the U.S. imposes steep tariffs on products imported from Denmark, the prices of Ozempic and Wegovy would likely increase. This price increase could help Eli Lilly, as it would likely see an increase in demand for its competing drugs, Mounjaro and Zepbound, especially if insurers begin directing their members to Lilly's products to lower their costs.



Based on the information provided, if Trump's tariffs on imports from Denmark increase the prices of Novo Nordisk's Ozempic and Wegovy, it could lead to an increase in demand for Eli Lilly's Mounjaro and Zepbound. This is because these drugs are direct competitors to Ozempic and Wegovy, and a price increase for the latter could make Lilly's drugs more attractive to consumers and insurers.

An analyst from Leerink Partners, David Risinger, mentioned that Zepbound's recent approval for treating obstructive sleep apnea could also drive demand, as Medicare can now reimburse patients for the cost of the drug. This approval opens up a substantial revenue opportunity for Eli Lilly, as there are approximately 20 million Americans with moderate-to-severe obstructive sleep apnea.

Additionally, Risinger noted that Zepbound outperformed Wegovy in a head-to-head study, with Zepbound patients losing up to 20.2% of their body weight compared to 13.7% for Wegovy recipients over 72 weeks. This could further increase demand for Zepbound and Mounjaro, as patients and healthcare providers may prefer these drugs over their competitors.

In summary, if Trump's tariffs lead to a price increase for Novo Nordisk's drugs, it could potentially increase demand for Eli Lilly's obesity and diabetes drugs, leading to higher revenue for the company. The approval of Zepbound for treating obstructive sleep apnea and its superior performance in clinical trials compared to Wegovy could also contribute to increased demand and revenue for Eli Lilly.



Trump's policies on healthcare and drug pricing could potentially impact Eli Lilly's long-term growth prospects in several ways. While tariffs on imported drugs could boost demand for Eli Lilly's products, changes in drug pricing, subsidies, and vaccine programs could have the opposite effect. For instance, if enhanced subsidies for health insurance exchanges expire in 2025, it could lead to a decrease in the number of individuals covered by exchanges, which might affect hospitals' payor mix and profitability. This could indirectly impact Eli Lilly's sales, as a lower number of insured patients might lead to reduced demand for its drugs.

Moreover, if Trump appoints an anti-vaxxer like Robert F. Kennedy Jr. to oversee health initiatives, it could potentially lead to decreased public trust in vaccines and reduced demand for them. This could indirectly impact Eli Lilly, as lower vaccination rates might result in increased prevalence of certain diseases, which could affect the demand for Eli Lilly's drugs.

In conclusion, Trump's policies on healthcare and drug pricing could have both positive and negative impacts on Eli Lilly's long-term growth prospects. While tariffs on imported drugs and favorable Medicare Advantage policies could potentially boost demand for Eli Lilly's products, changes in drug pricing, subsidies, and vaccine programs could have the opposite effect. It is essential to monitor these policies and their potential impacts on Eli Lilly's business to make informed decisions about the company's long-term growth prospects.