Eli Lilly’s Alzheimer’s Drug Could be Rejected by NHS
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Eli Lilly’s Alzheimer’s Drug Could be Rejected by NHS

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Eli Lilly’s Alzheimer’s drug, donanemab, could be rejected for use by Britain’s NHS. This rejection could cause a dip in the expected sales of the drug, which is already approved in the U.S.

Healthcare company Eli Lilly’s (LLY) Alzheimer’s drug, donanemab (marketed as Kisunla), could be rejected for use by the National Health Service (NHS) in Britain, according to a report by The Telegraph. The drug might face rejection in the UK owing to the risk of its side effects, although it has been approved for use in the U.S. by the FDA (Food and Drug Administration). A rejection could impact the expected monetary benefits for Eli Lilly from donanemab sales in the UK.

Eli Lilly’s Donanemab Faces Possible Rejection in the UK

The Telegraph report states that the National Institute for Health and Care Excellence (NICE), the agency responsible for approving drugs on the NHS, could reject donanemab. The NICE has already disapproved Eisai’s (ESALF) lecanemab, citing high costs and requirements for monitoring side effects, making it a drag on taxpayers’ money.

Donanemab is considered to be more effective than lecanemab in slowing the progression of Alzheimer’s. The drug is viewed as the best to date for treating Alzheimer’s. It is worth noting that, unlike lecanemab, donanemab is not yet approved by the UK’s drug regulator, MHRA (The Medicines and Healthcare Products Regulatory Agency). The MHRA’s decision was earlier expected in July but has been postponed. Nonetheless, the decision for the use of donanemab by the NHS rests with the health services spending watchdog, NICE. 

Here’s a Bit More About Kisunla

Kisunla or donanemab is a once-monthly drug that slowed Alzheimer’s progression by up to 39% in an 18-month trial. Kisunla’s Phase 3 trial results displayed that the drug slowed cognitive and functional decline by up to 35% as compared to placebo. The drug competes with Biogen (BIIB) and Eisai’s lecanemab, commercially called Leqembi, which has shown that it can slow Alzheimer’s progression by only 27%. Notably, Leqembi too is approved for use by the U.S. FDA.

However, both Kisunla and Leqembi have notable potential side effects, including brain swelling, bleeding, and even death.

TipRanks Bull Says, Bears Say Tool

Despite the possible setback related to donanemab in the UK, Eli Lilly is well-positioned for future growth as it has a solid pipeline of potential drugs. In its Q2 FY24 results, LLY raised its full-year revenue guidance by $3 billion, thanks to strong sales expectations for its diabetes and obesity drugs, Mounjaro and Zepbound.

According to TipRanks Bulls Say, Bears Say tool, analysts are encouraged by Eli Lilly’s future growth prospects due to the international penetration of its Mounjaro drug and promising data from Tirzepatide for treating obesity.

On the other hand, Bears are mindful of looming competition, regulatory headwinds, and the expected supply constraints for Tirzepatide.

Is Eli Lilly a Buy, Sell, or Hold?

With 17 Buys versus two Hold ratings, LLY stock has a Strong Buy consensus rating on TipRanks. The average Eli Lilly price target of $1,038.53 implies 9% upside potential from current levels. Shares have already gained 64.2% so far this year.

See more LLY analyst ratings

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