How Eli Lilly got weight-loss pill

I read an interesting story in the FT last week, which I wanted to share. The story showed how hard it is to know early on if a new drug will become a blockbuster.

In 2018, the Swiss pharma giant Roche missed out on acquiring a potential blockbuster weight-loss pill, now being developed by Eli Lilly, which could generate $14 billion annually by 2032.

Roche passed on its "right of first refusal" to buy the drug, then known as Owl-833, from its long-time partner Chugai, valuing it at just tens of millions. Instead, Eli Lilly purchased it, now called orforglipron, for $50 million. The pill is expected to launch in 2026 and could dominate the $130 billion weight-loss market, giving Eli Lilly a significant advantage with its scalable GLP-1-based formula.

At the time, Roche decided to get out of obesity drugs after past setbacks. They have since re-entered the weight-loss market by acquiring Carmot Therapeutics for $3.1 billion. Their disastrous decision in 2018 highlights the challenges of identifying future blockbuster drugs early on.

Despite the missed opportunity, Roche has had other successes with products from Chugai, such as the $4.5 billion-a-year haemophilia treatment Hemlibra.

You win some, you lose some.