Everything seems to be going right for Novo Nordisk (NVO -0.40%) these days. The big drugmaker reported strong revenue and earnings growth in its second-quarter results. Its shares have jumped more than 50% year to date.

The story continues to get even better. Ozempic sales are skyrocketing faster than expected. That's obviously good for Novo Nordisk. Here's why it's also great news for Eli Lilly (LLY 4.28%) stock, which has soared even more than Novo Nordisk's shares have so far in 2023.

Higher and higher

Last week, Novo Nordisk raised its full-year outlook for 2023. The company now projects sales will jump between 32% and 38%, up from its previous guidance of sales growth of 27% to 33%. Novo also anticipates operating profit will increase between 40% and 46%. Its prior forecast was for operating profit growth of 31% to 37%. 

There's no big surprise why Novo Nordisk is more optimistic about its full-year prospects. The company stated that the revised guidance reflects higher sales expectations for type 2 diabetes drug Ozempic and its sibling, weight-loss drug Wegovy. 

Ozempic and Wegovy are different brand names for the same underlying drug-semaglutide. The key distinctions between the two are the indications for which they're approved and their dosage levels. 

Doctors can (and many often do) legally prescribe Ozempic for weight loss as well as for type 2 diabetes. Ozempic became wildly popular with celebrities publicly talking about their use of the drug to lose weight. This even led to supply shortages. 

How Lilly benefits from Ozempic's success

How does Novo Nordisk's greater expectations for Ozempic help Eli Lilly? Good news for Ozempic almost certainly means good news for Lilly's Mounjaro also.

Like Ozempic, Mounjaro is approved for treating type 2 diabetes. Also like Ozempic, Lilly's drug is frequently prescribed off-label for helping patients lose weight. Soaring demand for Mounjaro has resulted in supply shortages as well. 

With Novo Nordisk now projecting increased sales growth for Ozempic (and Wegovy), it's very likely that Lilly's sales of Mounjaro will be higher than expected, too. Novo's guidance hike will also potentially ratchet up the intense anticipation of the U.S. Food and Drug Administration's approval decision for Mounjaro in weight loss, which could come by early 2024 and perhaps even sooner. 

Lilly added fuel to the fire of investors' enthusiasm about Mounjaro over the last weekend. On Sunday, the company released detailed results from a late-stage study that showed Mounjaro helped patients lose on average 26.6% of their body weight over an 84-week period.

Is Eli Lilly stock a buy?

It's rare that pharmaceutical products attract the widespread attention that Ozempic and Mounjaro have. Wall Street analysts even predict that Mounjaro could become the world's top-selling drug with annual sales of over $50 billion.

But does all of the hoopla mean that Eli Lilly stock is a buy? There's an argument to be made that it isn't. The consensus 12-month price target for Lilly is a little lower than the current share price. 

Analysts appear to be concerned that most of Lilly's near-term growth potential is already baked into the share price after the stock's impressive performance this year. They could be right. Lilly's shares trade at a sky-high forward earnings multiple of close to 48x. 

However, it's probably going to take a few years for Mounjaro to reach peak sales. In the meantime, Lilly has other growth drivers, notably including cancer drug Verzenio and type 2 diabetes drug Jardiance. The company also hopes to soon win regulatory approvals in the U.S. and Europe for its next potential mega-blockbuster, Alzheimer's disease drug donanemab.

My view is that Lilly stock remains a great pick for long-term investors. And I fully expect the sales for both Ozempic and Mounjaro will continue to climb.