Almost every day, my mind is blown by what's happening in the field of medicine...
There have been four pieces of particularly amazing news recently, all of which benefit one of my favorite stocks – drugmaker Eli Lilly (LLY).
I've written about the stock nearly three dozen times since 2022 (archive here), mainly centered around the miraculous GLP-1 weight-loss drugs. (Just yesterday, I bumped into an old friend who told me he has lost 30 pounds on Lilly's Zepbound, with no side effects.)
I pounded the table on Lilly's stock on September 25, after it had tumbled from nearly $1,000 to a low of $712.05. Since then, it has soared 50%, closing yesterday at $1,064.74.
But it may be a better idea today than it was then... because of the latest developments that could drive massive profit growth for Lilly long into the future.
The first good news addresses one of the biggest concerns about these GLP-1 drugs – that users don't just lose fat but also muscle, as this Washington Post article notes:
Several large studies in recent years had suggested that people taking GLP-1 drugs such as Zepbound or Wegovy were losing outsize proportions of their muscle mass while also shedding body fat.
In some of those studies, nearly 40 percent of people's weight loss with GLP-1 drugs seemed to come from muscle, a much higher percentage than would be considered normal among people losing weight by dieting or other lifestyle changes.
Researchers wondered if the GLP-1 drugs might somehow be targeting muscles, causing them to shrink during weight loss, potentially contributing to weakness and sarcopenia, which is a serious decline in muscle and strength.
However, as the article continues, a new study published in Cell Reports Medicine reached a different conclusion:
The study's authors looked more closely than in many past experiments at changing body composition in mice receiving various types and doses of GLP-1s and also examined the drugs' effects on strength and physical function in mice and people...
The scientists gathered a large group of obese mice, carefully measured the animals' body compositions and provided them with varying versions and doses of GLP-1s. As expected, the animals lost substantial weight, most of which was body fat, but some was muscle.
Muscle loss made up barely 25 percent of the total, though, less than the 40 percent seen in some GLP-1 studies.
The main reason for this disparity, the researchers concluded, was livers...
The livers had shed internal fat, making them healthier. But that shrinkage might be misinterpreted as muscle loss if researchers measure lean mass as a monolith.
The study also showed no loss of strength:
After heavy mice lost weight with GLP-1s they kept pace on rodent treadmills with lean mice, even though they remained somewhat larger.
Likewise, when the researchers recruited a small group of 10 middle-aged men and women with obesity and asked them to lose weight with GLP-1s, they found that the volunteers' leg muscles declined slightly in size but, according to leg extension testing, retained at least as much strength as before, relative to people's body mass.
The second piece of good news was Lilly's press release last week with the latest clinical trial results of its newest GLP-1 drug, retatrutide ("reta").
The average patient on the full 12 mg dosage lost 70 pounds (28.3% of their body weight). And the most obese patients lost an average of 85 pounds (30.3%) within two years – astounding!
The results further reinforce my belief, which I detailed in my May 8 e-mail, that reta is going to be a blockbuster of epic proportions when Lilly releases it, likely early next year.
This graphic posted on X shows how dramatically the U.S. obesity rate would drop with the universal adoption of reta:
This New York Times article about the trial's results reveals another extraordinary finding:
The unexpected happened when patients took the lowest dose. More people taking the placebo dropped out of the study because of perceived side effects than people taking the active drug, Dr. [Daniel] Skovronsky said.
At that dose, participants lost about 19 percent of their weight, which is about what people lose with the highest dose of Zepbound. But retatrutide seemed surprisingly well tolerated.
This makes me think the market for reta isn't limited to overweight or obese people. I think millions of average-weight people could microdose the drug if there are minimal or no side effects – especially given the many health benefits beyond weight loss, such as lower cholesterol and a possible reduced risk of dementia.
That brings us to the third piece of good news: There's powerful new evidence that GLP-1 drugs may also help slow the progression of cancer, as this WSJ article details:
New studies suggest drugs like Ozempic, Zepbound might slow tumor progression and improve survival; more research needed to confirm finding
- GLP-1 drugs, including Ozempic and Mounjaro, are linked to potential benefits for cancer patients, reducing tumor progression and death risk.
- Observational studies showed GLP-1 users had reduced cancer spread, with lung and breast cancer progression cut by half.
- GLP-1 users were 25% less likely to be diagnosed with breast cancer and had higher five-year survival rates in other studies.
While these studies are observational, the implications are astounding.
But most astounding of all was the fourth piece of good news, about another drug Lilly has in early-stage trials – VERVE-102, a gene-editing drug designed to lower "bad" LDL cholesterol.
As the company's press release from Monday notes:
In the Heart-2 study, a single intravenous infusion of VERVE-102 resulted in meaningful lowering of circulating PCSK9 protein and corresponding reductions in LDL-C across all evaluated dose levels. In this interim analysis of 35 participants, a single dose of VERVE‑102 resulted in dose-dependent mean reductions in PCSK9 ranging from 51% to 88%...
Aakash Gupta breaks down why these results are so significant in this X post:
Dr. Afshine Emrani shares Gupta's enthusiasm. In a five-part X post, he begins by outlining how the drug could prevent millions of cardiovascular-related deaths:
He then highlights incredible developments in many other areas of medicine, including GLP-1s:
Dr. Emrani concludes on a powerful, personal note:
I agree. Let us celebrate that, when it comes to medicine, we are indeed "living in Messianic times."
And right now, Lilly's stock could be the best way to profit from these revolutionary developments...
While it's trading at a rich 30 times this year's earnings estimates, I think the company's future prospects and growth will make today's price look cheap in the not-too-distant future.
Best regards,
Whitney
P.S. I welcome your feedback – send me an e-mail by clicking here.