If you're buying Eli Lilly (LLY 1.51%) stock today, odds are, it's because of its highly popular and successful GLP-1 drugs, Mounjaro and Zepbound. The former is approved to treat diabetes, while the latter is approved for weight loss. These drugs have generated billions in revenue for the company, and they are still in their early growth stages.
But while GLP-1 may be the flashiest and most exciting reason to invest in Eli Lilly, the business is far bigger than that. There are three other amazing growth opportunities for the business to tap into in the long run, which, if they pay off, could make the seemingly expensive stock look like a steal of a deal in the future.
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1. Kisunla
Last year, the Food and Drug Administration approved Kisunla, which is a treatment for people with early Alzheimer's disease. In clinical trials, the drug has shown that it can help slow cognitive decline in people with Alzheimer's.
The obvious problem is that by the time Alzheimer's is caught, it's often not in the early stages. But there could soon be ways to get ahead of the illness. Researchers from Mass General Brigham have recently developed a test that can be done at home that can be helpful in detecting cognitive impairment to identify people at risk of developing Alzheimer's, and it involves simply sniffing odor labels.
As the healthcare industry improves methods for detecting Alzheimer's in its early stages, that could unlock a massive opportunity for Kisunla to help more people earlier. While it's already a potential blockbuster drug (with peak sales estimated to be around $5 billion per year), early detection tests could unlock even more for the drug.
2. Radiopharmaceuticals
Eli Lilly is also investing in a novel approach to cancer treatment: radiopharmaceuticals. These types of drugs use radiation and specifically target unhealthy cells. This can make them more precise in their treatment, as a big problem with chemotherapy is that it can harm healthy cells. Radiopharmaceutical drugs have the potential to revolutionize cancer care and may lead to better outcomes for patients, especially those with hard-to-treat cancers.
Last year, Eli Lilly announced a collaboration with Aktis Oncology that involves a $60 million upfront payment as Eli Lilly works to develop radiopharmaceuticals using Aktis Oncology's miniprotein technology platform. In the year prior to that, Eli Lilly announced the purchase of Point Biopharma for $1.4 billion, which is another company that's involved in radiopharmaceuticals.
While it's still the early stages of radiopharmaceutical drug development for Eli Lilly, it's a promising opportunity that could pave the way for better treatment options and unlock more growth for the business in the long run.
3. AI-powered drug discovery
Most recently, Eli Lilly announced it would be partnering with chipmaker Nvidia to utilize artificial intelligence (AI) in drug discovery. With the help of AI, drug discovery can potentially become much more efficient and effective. By tapping into existing data and using AI to potentially uncover new opportunities more quickly, this could be the most exciting growth opportunity to watch out for.
However, it will take a while, and it could take until the end of the decade before there are any significant benefits from this initiative, according to Diogo Rau, chief information and digital officer for Eli Lilly. But it's a great example nonetheless of the company's pursuit of growth and innovation.
NYSE: LLY
Key Data Points
Eli Lilly is a fantastic growth stock to buy and hold
Although the past 12 months haven't been terribly great for Eli Lilly, as the stock is up just 7%, this remains an excellent growth investment to hang on to for the long haul. The company's growth prospects look incredible, with not only GLP-1 treatments but the multiple opportunities I noted above.
This is why I'm confident that Eli Lilly will become the first healthcare stock to join the trillion-dollar club. This is an unstoppable business to invest in, and one that all growth investors should consider putting into their portfolios.
