Eli Lilly's $1 Trillion Milestone: Is Now the Time to Buy Before the Next Big Rally?

Eli Lilly's recent surge to a $1 trillion market cap has redefined expectations for the biopharmaceutical sector. With blockbuster drugs like Mounjaro and Zepbound dominating the GLP-1/GIP space and a robust R&D pipeline advancing, the company is poised to capitalize on multiple growth vectors. This analysis evaluates whether the current valuation reflects sustainable momentum or presents a strategic entry point for investors ahead of 2028 inflection points driven by orforglipron and Kisunla.

Q3 2025 Financials: A Blueprint for Sustained Growth

Eli Lilly's Q3 2025 results underscore its dominance in the GLP-1/GIP market. Revenue surged 54% year-over-year to $17.6 billion, driven by volume growth in Mounjaro and Zepbound, which together accounted for over 60% of total sales. Gross margins expanded to 82.9%, reflecting a favorable product mix despite downward pressure from pricing dynamics. Non-GAAP net income reached $6.31 billion, with EPS climbing to $7.02-a 584% increase from Q3 2024. The company raised its full-year revenue guidance to $63–63.5 billion, signaling confidence in maintaining its trajectory.

These results highlight Lilly's ability to scale production and optimize margins, even as it navigates competitive pressures. The company's R&D and marketing expenses, while rising by 27% and 31% respectively, reflect strategic investments in sustaining its leadership position.

Competitive Edge in GLP-1/GIP: Dual-Targeting and Oral Innovation

Lilly's dominance in the GLP-1/GIP space stems from its dual-targeting mechanism, which outperforms single-pathway competitors like Novo Nordisk's Ozempic and Wegovy. Mounjaro and Zepbound, which combine GLP-1 and GIP agonism, have captured 57% of the U.S. incretin market, offering superior weight loss and glycemic control. This differentiation has allowed Lilly to command premium pricing while scaling manufacturing faster than rivals.

The next frontier is orforglipron, an oral GLP-1 receptor agonist in late-stage development. Clinical trials, including the ACHIEVE-1 Phase 3 study, demonstrated a 7.9% average weight loss at the highest dose, with a safety profile consistent with the GLP-1 class. Analysts project orforglipron could generate $19 billion in annual sales by 2035, representing 15% of Lilly's revenue. Its oral format addresses a critical unmet need, as 40% of patients prefer pills over injections.

Orforglipron: A Game-Changer for Market Accessibility

Orforglipron's potential lies in its scalability and patient-centric design. Unlike injectable therapies, it is a once-daily pill with no food or water restrictions, enabling broader adoption. Lilly plans to submit an NDA for obesity in late 2025 and for type 2 diabetes in 2026. With 88% probability of approval, the drug is positioned to capture a significant share of the $100 billion obesity and diabetes market.

However, competition is intensifying. Novo Nordisk's amycretin and Viking Therapeutics' VK2735 are advancing rapidly, with the latter showing 23.9% weight reduction in early trials. Yet, Lilly's first-mover advantage and manufacturing scale-evidenced by its stockpiling of billions of doses-provide a buffer against rivals.

Kisunla: A High-Stakes Bet in Alzheimer's

Kisunla, Lilly's Alzheimer's drug approved in 2025, represents another growth pillar. Clinical data shows it reduces amyloid plaques and slows cognitive decline by 27% in early-stage patients. Despite safety concerns around ARIA (amyloid-related imaging abnormalities), the drug's efficacy and Medicare/Medicaid reimbursement coverage have driven adoption. Analysts project Kisunla could achieve $10 billion in annual sales by 2030, though it faces stiff competition from Biogen/Eisai's Leqembi.

The Alzheimer's market is expanding rapidly, with a projected CAGR of 23.7% through 2034. However, Leqembi's lower ARIA risk and diagnostic advantages may limit Kisunla's market share to 25% by 2030. This underscores the need for Lilly to innovate further, potentially leveraging its GLP-1/GIP expertise to explore novel Alzheimer's therapies.

Expert Outlook: A $1 Trillion Valuation Justified?

Morgan Stanley's recent upgrade of Lilly to "overweight" with a $1,290 price target reflects confidence in its growth trajectory. The firm cites the broadening GLP-1 market and Lilly's first-mover advantage in oral therapies. Meanwhile, Truist Securities notes that orforglipron's efficacy, while strong, may not match injectables like Mounjaro. However, the drug's convenience and scalability are seen as critical differentiators.

From a valuation perspective, Lilly's P/E ratio of 65x (as of November 2025) appears elevated but is justified by its high-margin business model and $19 billion in annual R&D spending. The company's ability to sustain double-digit revenue growth through 2028-driven by orforglipron, Kisunla, and continued Mounjaro/Zepbound demand-supports its premium valuation.

Conclusion: Strategic Entry Before the 2028 Inflection

Eli Lilly's $1 trillion milestone is not a peak but a springboard. The company's financial strength, combined with its leadership in GLP-1/GIP and Alzheimer's, positions it to outperform peers. While near-term risks include regulatory delays for orforglipron and competitive pressures in Alzheimer's, the long-term catalysts-oral obesity therapies and disease-modifying Alzheimer's treatments-justify a strategic entry for investors. With 2028 approaching, the next 3–5 years could see Lilly's market cap double, making now an opportune time to buy before the next rally.