uploads/2017/04/Chart-006-Neuro-1.jpg

Eli Lilly’s Estimate for Strattera, Other Neuroscience Products

By

Updated

Neuroscience franchise

Neuroscience is one of Eli Lilly and Company’s (LLY) franchises in its human pharmaceutical segment. Key drugs in this segment include Zyprexa, Cymbalta, and Strattera.

Article continues below advertisement

Strattera

Strattera, a drug for ADHD (attention deficit hyperactivity disorder), is expected to report a rise in revenues for 1Q17 due to increased sales worldwide. Strattera competes with Shire’s (SHPG) Vyvanse and Intuniv, and Johnson & Johnson’s (JNJ) Concerta.

Other drugs in the neuroscience franchise

The contribution of neuroscience products is more than 13.0% of Eli Lilly’s total revenues. Other drugs in the neuroscience franchise include Cymbalta and Zyprexa.

Article continues below advertisement

Cymbalta

Cymbalta is an antidepressant used for the treatment of depression and anxiety. It’s sometimes used for bone and muscle pain. Cymbalta revenues are expected to fall in 1Q17 due to lower sales in the US and international markets following its loss of exclusivity.

Zyprexa

Zyprexa is an antipsychotic drug used in the treatment of brain disorders such as schizophrenia and bipolar disorder. Zyprexa revenues are expected to fall in 1Q17 due to lower sales in international markets following the loss of exclusivity in Japan. Other pharmaceutical companies such as Mylan (MYL) and Teva Pharmaceutical Industries (TEVA) offer generic products similar to Zyprexa.

To divest the company-specific risks, you can consider ETFs such as the VanEck Vectors Pharmaceutical ETF (PPH), which holds 5.0% of its total assets in Eli Lilly (LLY). PPH also holds 10.3% of its total assets in Johnson & Johnson (JNJ), 4.1% in Teva Pharmaceutical Industries (TEVA), and 3.9% in Mylan (MYL).

Advertisement

More From Market Realist