Eli Lilly’s Obesity Drug Future Brightens, Bank of America Predicts Growth
Eli Lilly & Co. (NYSE: LLY) continues to solidify its leadership in the obesity therapeutics market, with a recent analysis from Bank of America indicating that the company’s potential growth is still underestimated. On Monday, analyst Jason Gerberry reaffirmed a Buy rating on Lilly’s stock, slightly adjusting the price target from $1,286 to $1,268. This revision does not reflect reduced confidence; rather, it suggests that there is still “room for stock upside” as Lilly launches key obesity treatments and mitigates risks associated with new therapies across various market segments.
Bank of America highlighted Lilly’s prominent position in injectable GLP-1 treatments but believes the real opportunity lies in the upcoming launch of Orfoglipron. Gerberry noted that the market consensus may be undervaluing this new oral GLP-1 weight-loss pill, which is expected to debut in the second half of 2026 after an expedited regulatory review.
Orfoglipron: A Game Changer in Obesity Treatment
Orfoglipron differentiates itself from injectable therapies by eliminating the need for refrigeration and injections, making it more accessible to patients. This ease of use can significantly enhance patient compliance, especially as expert feedback indicates that Orfoglipron’s lack of a fasting requirement offers a notable advantage over competing oral GLP-1s, such as Wegovy from Novo Nordisk A/S. Bank of America projects that Orfoglipron could generate approximately $3 billion in revenue in its launch year, substantially exceeding current consensus estimates of around $1 billion.
To provide context, Gerberry pointed out that Lilly’s Zepbound achieved roughly $5 billion in U.S. sales during its first full year despite facing supply constraints and limited access. The forecast for Orfoglipron is buoyed by recent developments regarding government access to obesity medications.
Strategic Government Agreements Enhance Access
A critical factor in Bank of America’s optimistic outlook is Lilly’s recent agreement with the U.S. government, enabling Medicare and Medicaid beneficiaries to access obesity medications at a fixed net price of $245—about $50 per month for patients. While such agreements might pressure market pricing, the bank interprets this as a strategic trade-off that may lead to increased patient volumes. Over time, this could compel commercial insurers to broaden their coverage, further solidifying Lilly’s early-mover advantage in the obesity sector.
Looking ahead, Bank of America maintains that Lilly’s long-term growth potential remains robust. Several upcoming data readouts, particularly from multiple Phase 3 trials for the treatment retatrutide (referred to as Triple G), are anticipated to shape the company’s future trajectory. Gerberry sees a significant opportunity among “super-obese” patients, with or without serious comorbidities, and believes these segments could support sales in the high-single-digit billion range.
On the competitive landscape, Bank of America expects that Novo Nordisk’s forthcoming head-to-head obesity studies will demonstrate non-inferiority but does not consider it a threat to Zepbound’s established position. Overall, the bank asserts that Lilly’s sales growth trajectory over the next five to seven years supports a premium valuation, given its leadership in obesity treatments, forthcoming oral GLP-1 launches, expanding access channels, and a diverse pipeline.
As the launch of Orfoglipron approaches, Bank of America concludes that the market may still be underestimating the potential scale of Lilly’s next chapter in obesity treatment.
