How Will Eli Lilly's Oncology Drugs Perform in Q2 Earnings?
Our model estimates second-quarter 2025 sales for the overall oncology unit to be $2.4 billion, indicating more than 11% year-over-year growth. A significant portion of these revenues is likely to have been generated from sales of the company's blockbuster breast cancer drug, Verzenio. Sales of this drug are expected to have been driven by increased demand and higher realized prices during the quarter, partially offset by currency headwinds and competitive dynamics.
Sales of RET inhibitor Retevmo and newer lymphoma drug Jaypirca are also likely to have contributed positively to top-line growth during the quarter.
However, these gains might have been partially offset by the declining sales of older cancer drugs like Alimta and Cyramza, which are being impacted by competition from immuno-oncology agents in the United States.
Though Lilly's oncology portfolio is contributing meaningfully, investor focus will largely remain on blockbuster GLP-1 medicines — Mounjaro (for type II diabetes) and Zepbound (for obesity). Investors will closely track their sequential growth and market share trends in the upcoming second-quarter results on Aug. 7.
Competition in the Oncology Space
Other bigger players in this area are AstraZeneca AZN, Merck MRK and Pfizer PFE.
For AstraZeneca, oncology sales now account for nearly 41% of total revenues. Growth in AZN's oncology franchise is being driven by medicines such as Tagrisso, Lynparza, Imfinzi, Calquence and Enhertu (in partnership with Daiichi Sankyo).
Merck's key oncology medicines are PD-1 inhibitor, Keytruda and PARP inhibitor, Lynparza, which it markets in partnership with AstraZeneca. Keytruda, approved for several types of cancer, alone accounts for nearly half of Merck's product revenues.
Pfizer's oncology segment — comprising drugs like Xtandi, Lorbrena, the Braftovi-Mektovi combination and Padcev — currently accounts for more than 27% of its total revenues.
LLY's Price Performance, Valuation and Estimates
Shares of Lilly have outperformed the industry year to date, as seen in the chart below.
From a valuation standpoint, Eli Lilly is expensive. Based on the price/earnings (P/E) ratio, the company's shares currently trade at 29.66 times forward earnings, higher than its industry's average of 14.91. However, the stock is trading below its five-year mean of 34.54.
EPS estimates for 2025 have risen from $21.92 to $21.99, while those for 2026 have declined from $30.91 to $30.79 over the past 30 days.
Eli Lilly currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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