Eli Lilly and

Bull case

Eli Lilly is supported by a dominant incretin franchise, with 3Q26 sales expected to beat on Zepbound and Mounjaro strength, plus robust ex-US volume growth and Mounjaro holding about 55% international market share. The shares’ pullback on Bridge Program pricing concerns looks excessive because Bridge represents only about 10% of US TRx and appears to create a favorable price-for-volume tradeoff, while the company may raise guidance by about $2bn as sales trend above the current $85bn–$87bn range. Beyond obesity and diabetes, the outlook is reinforced by a deep pipeline and improving launches such as Foundayo, along with upcoming R&D Day and other catalysts that could support continued growth and multiple expansion.

Bear case

• Eli Lilly is facing a deteriorating fundamental setup as pricing concessions and the Medicare Bridge program are pressuring Zepbound and Foundayo, with US average Zepbound pricing modeled down 18% y/y to $524 per TRx in 3Q and autoinjector pricing down about 5% YoY.
• The company’s franchise also shows softening demand in mature assets, as Verzenio TRx fell 2% y/y with a modeled -5% miss and Trulicity TRx declined more than 20% y/y for a third consecutive quarter, signaling mix and competitive pressure.
• That combination raises the risk that operating margins are compressed if obesity growth slows faster than expected, while additional pricing pressure from payors and regulators could further restrain EPS growth and weigh on valuation.