For both the biotech and pharmaceutical industries, what happens in the laboratory is critical to success (or failure, on the flip side).

Some good news from a clinical trial conducted by Eli Lilly (LLY 5.22%) boosted the share price of the pharmaceutical giant (by 0.5%) on Wednesday, leaving several rivals in the dust. These included device makers ResMed (RMD -2.43%), whose stock suffered a 6% blow, and AdaptHealth (AHCO -1.58%), with a nearly 2% decline.

One very useful molecule

Before market open, Eli Lilly announced that its molecule tirzepatide had achieved its primary endpoints in a set of phase 3 clinical trials. The studies aimed to judge its efficacy in treating obstructive sleep apnea (OSA), a common disorder in which people struggle to breathe properly while asleep.

The company said that tirzepatide had been shown to significantly reduced the apnea-hypopnea index (AHI) compared to a placebo. The AHI, which measures how frequently a patient's breathing is restricted or blocked, is considered an important measure of the condition's severity.

Tirzepatide is the basis for Mounjaro and Zepbound, the pharmaceutical titan's Food and Drug Administration (FDA)-approved diabetes and weight loss medications. Along with Novo Nordisk's highly popular Ozempic and Wegovy, they appear to have properties that could be beneficial in treating other ailments. Both Eli Lilly and Novo Nordisk have been eagerly investigating such properties.

Eli Lilly's good news wasn't being taken well by investors in companies focused on sleep apnea. ResMed is particularly vulnerable, as its main focus is on products for that disorder and related respiratory afflictions such as chronic obstructive pulmonary disease (COPD). AdaptHealth is also active in these segments.

In its press release touting tirzepatide's results, Eli Lilly pointed out that 80 million adults in this country are affected by at least moderate forms of OSA. However, 85% of such cases are not diagnosed, and therefore many suffering receive no treatment.

The company quoted its senior vice president of product development Jeff Emmick as saying that "Addressing this unmet need head-on is critical, and while there are pharmaceutical treatments for the excessive sleepiness associated with OSA, tirzepatide has the potential to be the first pharmaceutical treatment for the underlying disease."

It's just the start

We are only at the beginning of a long-tail series of investigations into what molecules like tirzepatide and semaglutide (which is the basis of Ozempic and Wegovy) can do to treat afflictions other than diabetes and obesity. If any pharmaceutical company is going to discover new and potentially lucrative treatments, it's the extremely well-capitalized and cash-rich Eli Lilly. Investors in much smaller rivals are right to be concerned about this.