Eli Lilly LLY is sprinting ahead by partnering with external manufacturers to boost the production of its obesity drug, Zepbound (tirzepatide), establishing collaborations with industry giants like National Resilience and BSP Pharmaceuticals for the filling and “finishing” of its injector pens.
BSP Pharmaceuticals and National Resilience represent a subset of specialized contract manufacturers riding the wave of the obesity drug surge.
The global contract development and manufacturing sector is on the cusp of expanding from $72 billion to $90 billion within the next two years, underscoring the pressing need for increased fill-finish capabilities.
Further Reading: Eli Lilly’s Commercial Moat, Competitor Landscape: BofA Emphasizes Strength in Incretin Space, Undervalued Assets.
Both Eli Lilly and Novo Nordisk A/S NVO have injected billions into mitigating bottlenecks in active ingredient production and fill-finish processes as they grapple with a scarcity of top-tier medications for diabetes and weight management.
Despite Novo Nordisk’s recent acquisition of three “fill-finish” facilities from Catalent Inc CTLT, the company’s ability to ramp up production is delayed until 2026, as highlighted by the Financial Times.
Backed by a $410 million loan from the U.S. defense department, National Resilience is geared up to fill Zepbound injector pens at their Cincinnati plant, with a total capacity of 200 million doses by 2025.
Simultaneously, as per the reports from the Financial Times, BSP is poised to manufacture 61 million injectable doses of non-cancer medications by the end of the upcoming year.
While Eli Lilly is revving up production through external alliances, hurdles in the fill-finish phase loom large due to almost full production capacities.
Quoting industry experts, the Financial Times points out that although major players are developing oral weight-loss medications, supply constraints might persist for years to come.
With the global contract drug manufacturing market expanding, it may not offer an immediate antidote to the surging demand for obesity drugs, placing Eli Lilly and Novo Nordisk in a tight race against the clock.
Price Action: LLY shares witnessed a 1.19% surge, hitting $786.85 during the premarket session as of the latest update on Wednesday.
Disclaimer: This article was partly generated with the aid of AI tools and underwent thorough review and editing by Benzinga editors.
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