Eli Lilly Bets Billions on Unapproved Oral Obesity Drug

Eli Lilly US5324571083

Pharmaceutical giant Eli Lilly is making a bold $6 billion manufacturing bet on a drug candidate that has yet to receive regulatory approval. The investment, earmarked for a new facility focused on producing Orforglipron, underscores the company's aggressive strategy to dominate the obesity treatment market with an oral GLP-1 therapy. This move comes even as the company's share price experiences a recent downturn.

In a separate strategic development, Eli Lilly finalized its acquisition of Adverum Biotechnologies on December 9, 2025. The tender offer expired the previous day, with approximately 64% of shares tendered. Lilly paid $3.56 per share in cash, plus a Contingent Value Right (CVR) that could yield an additional $8.91 per share upon achieving specific milestones.

This deal grants Lilly access to Ixo-vec, a gene therapy candidate for wet age-related macular degeneration. The acquisition represents a deliberate expansion of Lilly's clinical pipeline beyond its core metabolic disease focus.

Manufacturing for a Potential Blockbuster

The cornerstone of Lilly's capital expenditure is a new active pharmaceutical ingredient (API) manufacturing plant in Huntsville, Alabama. This facility, the third of four planned new U.S. sites, is specifically designed for the production of Orforglipron. Construction is scheduled to begin in 2026, with completion targeted for 2032.

The timing aligns with the company's regulatory roadmap; Lilly plans to submit Orforglipron for approval by the end of 2025. This oral tablet aims to challenge the current injectable GLP-1 treatments, like Mounjaro, in the lucrative obesity market. The project is expected to create 450 permanent jobs and approximately 3,000 positions during the construction phase.

Clinical Progress and Shareholder Returns

Positive data continues to emerge from Lilly's research divisions. In the Phase 3 BRUIN CLL-313 trial, the drug Jaypirca (pirtobrutinib) demonstrated an 80% reduction in the risk of disease progression or death for patients with chronic lymphocytic leukemia (CLL) or small lymphocytic lymphoma (SLL).

Concurrently, the company's board has declared a quarterly dividend of $1.73 per share for Q1 2026. The payment will be distributed on March 10, 2026, to shareholders of record as of February 13.

Share Price Pressure Amidst Analyst Confidence

Despite these fundamental strengths, Eli Lilly's stock has faced technical selling pressure. On December 9, shares closed at $982.22, marking a decline of 1.54% and extending a losing streak to nine consecutive sessions.

Institutional analysts view the pullback as a potential opportunity. Goldman Sachs analyst Asad Haider reaffirmed a "Buy" rating on December 9, significantly raising his price target from $879 to $1,145. The analyst's message suggests the current share price weakness does not reflect the long-term growth potential embedded in Lilly's obesity and oncology pipelines. The multi-billion dollar wager on Orforglipron could prove to be a decisive strategic move—contingent on successful regulatory approval.