Eli Lilly has “viable option’ in type 2 diabetes, says RBC Capital

RBC Capital says that while the overall tolerability and A1C reductions for Eli Lilly’s (LLY) retatrutide in the TRANSCEND-T2D-1 study were worse compared to Mounjaro in type 2 diabetes patients, weight reduction and discontinuation rates favored retatrutide. This positions retatrutide as a “viable option” for type 2 diabetes patients where weight loss is a primary goal of therapy, the analyst tells investors in a research note. RBC believes retatrutide is a “key pillar” of Lilly’s growth and margin expansion story and will demand a premium price given that it is likely to be positioned in the more severe patients. It models a launch in 2027 and 2030 sales of $4.9B, below the consensus estimate of $5.4B. The firm has an Outperform rating on Lilly with a $1,250 price target