Over the past few years, Eli Lilly (LLY 2.22%) has delivered strong returns, largely thanks to its clinical progress, particularly in one key area: weight management. The company's efforts in this niche are already paying rich dividends.
However, the pharmaceutical leader isn't stopping yet. It already leads this area, and its recent developments suggest it could leave its competitors in the dust. Can any company catch up to Eli Lilly in the weight loss drug battle?
Only one real competitor
It's worth noting that, although many companies are seeking to enter this market, only one poses a serious threat to Eli Lilly, and that's Novo Nordisk (NVO 2.05%). The Denmark-based pharmaceutical giant markets Wegovy, an anti-obesity medicine that generates billions in annual sales.
Furthermore, Novo Nordisk is anticipating significant label expansions. It recently requested approval from the U.S. Food and Drug Administration for a higher dose of semaglutide (the active ingredient in Wegovy).
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The version of Wegovy with the higher dose proved more effective in helping patients lose weight in clinical trials. There is also an oral formulation of semaglutide awaiting regulatory approval in the U.S.
But Eli Lilly's Zepbound is best in class. Zepbound caused greater average weight loss than Wegovy in a head-to-head study. And through the first nine months of 2025, Zepbound generated $9.3 billion in revenue. Wegovy generated approximately $9 billion -- despite having been approved in the U.S. more than two years before its competitor.
Could Novo Nordisk's pipeline candidates help it catch up? In addition to the expected label expansions, the company is developing products such as Amycretin, which has both oral and subcutaneous formulations in phase 3 studies.
Even looking at their pipelines, though, Eli Lilly is the winner. The company posted strong phase 3 data for orforglipron, an oral weight loss medicine, this year. It should earn approval for that candidate sometime in 2026. More recently, Eli Lilly delivered yet another significant win, this time with retatrutide, an investigational weight loss therapy that delivered a mean weight loss of 28.7% at the highest dose in a phase 3 study.
Even Novo Nordisk's CagriSema, which posted 22.7% mean weight loss -- and is now under regulatory review for approval in the U.S. -- pales in comparison. So Eli Lilly is clearly ahead of its biggest rival here.
NYSE: LLY
Key Data Points
The lead is safe for now
Other companies are too far behind to hope to catch Eli Lilly. Sure, there are interesting pipeline candidates out there, but no one seems to have a more impressive lineup.
What's more, Eli Lilly is covering as many bases as possible. Zepbound is administered subcutaneously. Some thought they would be able to get a leg up on Eli Lilly with an effective oral weight loss medicine, but then orfoglipron performed very well in clinical trials. The company is also working on anti-obesity treatments that target hormones other than GLP-1, as well as some that can be administered less frequently.
Eli Lilly should remain the top player in this area for a while.
So, what does that all mean for the stock? The company is already posting strong sales and earnings growth thanks to its success. Its third-quarter revenue jumped 54% year over year to $17.6 billion, while its adjusted net income came in at $6.3 billion, significantly higher than the $1.1 billion reported in the same period last year. With new launches in this area, Eli Lilly should maintain excellent top- and bottom-line growth at least through the end of the decade. Some might argue that its success is already baked into its stock price.
However, there is still considerable upside left for the company, and it can continue to deliver strong returns. Eli Lilly's price/earnings-to-growth ratio of 1 is within the "fairly valued" range.
In addition to its dominance in weight loss, there are several compelling reasons to consider the stock. One of them is the dividend. Even with an unimpressive forward yield of 0.6% (which is hardly surprising considering its shares have skyrocketed over the past five years), Eli Lilly routinely increases its payouts, which have more than doubled since 2020.
Eli Lilly is a top stock for growth and dividends investors to buy today and hold on to for a while.
