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Understanding Lilly’s New Product Expectations for 2Q16

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Expectation from new products

Eli Lilly and Company’s (LLY) has launched various products under different franchises. The company’s new products include Portrazza, Cyramza, Basaglar, Jardiance, and Trulicity.

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Portrazza

Portrazza is a new drug for the treatment of metastatic squamous non-small cell lung cancer, or NSCLC. The drug was launched in December 2015 after the US FDA approved the drug on November 24, 2015. Portrazza is expected to report sales of ~$7 million in 2Q16. The European Commission approved Portrazza in combination with other chemotherapy as a first-line treatment of non-small cell lung cancer on February 24, 2016, and the drug was recently launched in Europe.

The European Commission approved Portrazza in combination with other chemotherapy as a first-line treatment of non-small cell lung cancer on February 24, 2016, and the drug was recently launched in Europe.

Other drugs in the oncology field include Pfizer’s (PFE) Inlyta and Sutent, Bristol-Myers Squibb’s (BMY) Opdivo, Merck’s (MRK) Keytruda, GlaxoSmithKline’s (GSK) Mekinist and Tafinlar, and Roche’s Zelboraf.

Basaglar

Basaglar is an insulin glargine injection to control blood sugar levels in patients with both type-1 and type-2 diabetes. Basaglar is expected to be launched in US markets in December 2016. Basaglar is expected to report revenues of around $10 million in 2Q16 from Japan and a few European markets.

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Cyramza

Cyramza is an oncology drug used in combination with other drugs for the treatment of metastatic NSCLC, advanced gastric cancer, and metastatic colorectal cancer. Cyramza’s revenues are expected to increase to $141 million for 2Q16, as compared to $88 million for 2Q15, mainly due to the increased demand in Japan and its launch in European markets for the treatment of metastatic NSCLC and metastatic colorectal cancer.

Trulicity

Trulicity is a drug for improving blood sugar levels in patients with type-2 diabetes. Trulicity is expected to report revenues of $181 million in 2Q16, as compared to $44 million in 2Q15, due to increased demand of Trulicity in US markets.

Jardiance

Jardiance is a drug meant to lower blood sugar levels in patients with type-2 diabetes. Jardiance is a part of the Boehringer Ingelheim and Lilly’s diabetes alliance. Revenues are expected to increase to more than $56 million in 2Q16, as compared to $11 million in 2Q15.

To divest risk, investors can consider ETFs like the iShares S&P Global Healthcare ETF (IXJ), which has ~1.9% of its total assets in Lilly.

Now let’s discuss Lilly’s Elanco in greater detail.

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