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Eli Lilly: Intriguing COVID-19 Story, but Questions Remain

Regeneron might be hogging all the headlines with its Trump administered COVID-19 antibody cocktail REGN-COV2, but it is not the only large cap pharma company staking a claim for its COVID-19 antibody program.

On Wednesday, Eli Lilly (LLY) announced it has applied for emergency use authorization (EUA) for one of its COVID-19 antibody candidates, LY-CoV555, as a monotherapy for higher risk patients with mild-to-moderate symptoms.

The positive news, however, got an added layer of gloss. The company also presented new interim trial data for the combination therapy of LY-CoV555 and another antibody, LY-CoV016, which indicates the antibody pairing improves outcomes for COVID-19 patients by significantly lowering viral load, symptoms, and COVID-related trips to the hospital.

The company will submit an EUA request for the combo treatment next month, and once enough data is available, will submit a full BLA (Biologics License Application) as early as Q2 2021.

While Mizuho analyst Vamil Divan calls the new data “promising,” the analyst believes the “clinical meaningfulness of some datapoints remains up for debate.”

“The combination therapy reduced viral load at day 11 (p=0.011), meeting the primary endpoint of the study, although the company noted that most patients including those on placebo achieved near complete viral clearance by day 11,” Divan noted.

That said, Divan also points out other benefits from the trial such as “a greater than six-fold reduction (a relative risk reduction of 84.5%) in the rate of COVID-related hospitalizations and ER visits over placebo, as well as the time-weighted average change in total symptom score from day 1 to 11 that was similar in magnitude and timing to those previously seen with LY-CoV555 monotherapy.”

Nevertheless, while the data appears encouraging, other questions still remain, and Divan wonders “where the combination would fall in the COVID treatment algorithm, how/where patients would receive it, and how Lilly may price the therapy.”

Overall, Divan rates LLY a Neutral (i.e. Hold) along with a $164 price target. This figure implies a modest upside of nearly 4% from current levels. (To watch Divan’s track record, click here)

Overall, opinions on the pharma giant’s trajectory are split, but tilting to the bulls. LLY's Moderate Buy consensus rating is based on 3 Buys and 2 Holds and is backed by a $170.67 average price target. Investors are looking at gains of 9%, should the figure be met. (See Eli Lilly stock analysis on TipRanks)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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