LLY's Next-Gen Obesity Drug Meets Goal in First Phase III Study for T2D

Eli Lilly LLY announced positive top-line results from a late-stage study evaluating its experimental once-weekly weight-loss drug, retatrutide, in adults with type II diabetes (T2D)

This study, called TRANSCEND-T2D-1, evaluated three doses (4 mg, 9 mg and 12 mg) of the drug for 40 weeks against placebo in adults with T2D and inadequate glycemic control with diet and exercise alone. Eli Lilly reported results using two approaches — an efficacy estimand, which reflects outcomes in patients who stayed on treatment throughout the study period and a treatment-regimen estimand, which incorporates data from patients who discontinued treatment.

The study achieved its primary endpoint. Under the efficacy estimand, patients who took retatrutide achieved A1C reduction (a measure of blood sugar levels) by an average of 1.7% to 2% compared to 0.8% in the placebo group. Across the treatment-regimen estimand, patients receiving the drug reduced A1C by an average of 1.7% to 1.9%, versus 0.8% in the placebo group.

For a key secondary goal, patients who took the drug lost up to 16.8% of their body weight using the efficacy estimand, compared to 2.5% in the placebo group. Under the treatment-regimen estimand, patients lost 15.3% of their body weight, compared to 2.6% in the placebo group. LLY noted that the weight loss continued through the end of the treatment period.

The TRANSCEND-T2D-1 is the second of the eight late-stage studies evaluating retatrutide across various cardiometabolic indications, including T2D, obesity with at least one weight-related medical problem, sleep apnea and chronic low back pain. In December, Eli Lilly reported top-line data from the late-stage TRIUMPH-4 study, which evaluated the drug in adults with obesity or overweight and knee osteoarthritis, and without diabetes. Results from this study showed that retatrutide lowered weight by up to an average of 28.7%. Data from some of the remaining studies are expected later this year.

Retatrutide activates three hormone receptors — GLP-1, GIP and glucagon — compared with the company’s approved obesity drug Zepbound, which targets GLP-1 and GIP. In comparison, Novo Nordisk’s NVO obesity drug Wegovy activates only GLP-1.

Eli Lilly’s Stock Movement

As seen in the chart below, Eli Lilly’s shares have underperformed the industry year to date.

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Competition Escalates in the Obesity Space

The obesity market has garnered significant attention over the past few years due to the sizeable and still underpenetrated market opportunity. Currently, Eli Lilly and Novo Nordisk dominate this space with their respective injectable therapies.

Eli Lilly and Novo Nordisk are racing to introduce oral weight-loss pills. In late December, the FDA approved an oral version of Wegovy. The drug was commercially launched in early January. The approval made Wegovy the first GLP-1 therapy available as a pill for weight management, offering a needle-free alternative that could expand patient adoption. A regulatory filing for Eli Lilly’s obesity pill orforglipron is currently under review by the FDA, with a final decision expected soon.

Several other companies, like Viking Therapeutics VKTX, are making rapid progress in the obesity space. Last year, VKTX started two late-stage studies evaluating the subcutaneous formulation of its investigational obesity drug, VK2735. While one of these studies recently completed enrolment at a rapid pace, the company expects to complete enrolment in the other study soon.

Last year, Pfizer PFE closed the acquisition of obesity drug developer Metsera for around $10 billion, after a heated bidding war against Novo Nordisk. The Metsera acquisition has brought Pfizer back into the lucrative obesity space by adding the latter’s four novel clinical-stage incretin and amylin programs, which are expected to generate billions of dollars in peak sales. In December, Pfizer announced that it is in-licensing exclusive global rights to develop and market an oral small molecule GLP-1 drug from a leading Chinese drugmaker.

Eli Lilly and Company Price

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LLY’s Zacks Rank

Eli Lilly currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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