Eli Lilly deploys weight-loss cash on ‘App Store’ for scientists

{"text":[[{"start":8.4,"text":"Eli Lilly is deploying its cash pile into untested drug development strategies, including an “App Store” for scientists, as the pharma group aims to shield itself from the expiry of patents on its blockbuster weight-loss drugs. "}],[{"start":23.85,"text":"The Indianapolis-headquartered group last year launched its own data centre with 1,016 advanced Blackwell computer chips, bought from semiconductor giant Nvidia, as part of a push into AI as a tool for drug discovery. "}],[{"start":38.1,"text":"Lilly’s computing investment included a new collaboration with about 100 smaller biotechs, allowing them to work with AI models in return for their data, chief executive Dave Ricks told the FT in an interview. "}],[{"start":52.05,"text":"He acknowledged that using AI to find new treatments is in its infancy but said the project was “like the App Store” for biotech scientists, referring to Apple’s marketplace that spurred software development."}],[{"start":64.1,"text":"“I hear speeches from [AI] founders saying, ‘oh, we’re going to make drugs with our computers.’ I don’t think that’s a present reality,” he said. “But of course, we also need to invest in those technologies.” "}],[{"start":75.55,"text":"Lilly’s revenues have been powered by its weight-loss products, including its Mounjaro injections and Foundayo pills. Its profits more than doubled in the first quarter with earnings per share jumping to $8.26. "}],[{"start":88.64999999999999,"text":"By the end of 2025 it had amassed cash and other highly liquid assets of $7.3bn, a 121 per cent year-on-year rise, giving it the dry powder to invest heavily in diversifying its business before its blockbuster weight-loss drugs start to come off patent in the 2030s. "}],[{"start":107.75,"text":"Biotechs that have joined Lilly’s AI training hub include drug research firm Charles River Laboratories, which announced it would take part in the collaboration last week."}],[{"start":null,"text":"

"}],[{"start":117.05,"text":"“It’s an open-source, federated model so that the cost to use it is participating with your data,” Ricks said, adding that all the data is being shared anonymously. “Our scientists use those models too so we get better and better.”"}],[{"start":132.15,"text":"The group, which this year celebrates its 150-year anniversary, said it had also signed about 20 deals to license AI technology from third parties. That is more than any other pharmaceutical company as of May, according to UBS."}],[{"start":146.05,"text":"In March Lilly also announced a $2bn deal with AI drug discovery business Insilico Medicine, gaining the exclusive rights to sell a GLP-1 drug if it is successfully developed and approved."}],[{"start":159.20000000000002,"text":"Ricks added that the AI hub was not available to everyone and “a Russian-based AI lab” would not be getting access."}],[{"start":166.85000000000002,"text":"Although AI remains an unproven technology as far as drug discovery is concerned, Lilly’s investment underscores a wariness about future competitors from the tech sector. "}],[{"start":null,"text":""}],[{"start":177.00000000000003,"text":"Google’s parent company Alphabet spun out a drug discovery business called Isomorphic Labs in 2021. Anthropic is integrating its Claude chatbot into tools such as lab management systems, genomic analysis platforms and biomedical databases, while Nvidia has open-source tools and GPUs dedicated to drug discovery."}],[{"start":198.00000000000003,"text":"Lilly’s AI spending has won applause from its shareholders. Using excess cash to do deals with Nvidia and partner with young biotechs in its hub “could potentially inform future drug discovery”, said Kevin Gade, chief operating officer at investment firm Bahl & Gaynor, which manages about $58bn and owns Lilly shares. "}],[{"start":218.10000000000002,"text":"Lilly’s collaborations with Nvidia include a San Francisco lab where the pharma group’s scientists will work alongside the AI group’s engineers to search for new treatments. "}],[{"start":229.00000000000003,"text":"“If AI is going to work, it pretty much has to apprentice under successful scientists over a long period of time . . . Lilly is the only company that is really doing that right now,” said Gade. "}],[{"start":240.65000000000003,"text":"The success of its weight-loss injections and pills has propelled Eli Lilly’s market capitalisation to around $1.1tn, above that of JPMorgan. The group generated more net income than ExxonMobil or Walmart in the first quarter of the year. "}],[{"start":255.70000000000005,"text":"Ricks declined to specify how much the company was spending on data centres, but said it was part of the company’s increasing R&D budget, which would be in the “high teens” in billions of dollars this year, up from $13bn in 2025."}],[{"start":270.20000000000005,"text":"With the gains from AI yet to be felt in launching new medicines, Ricks, 59, is also preparing for Lilly’s future the old-fashioned way by buying up biotechs. So far this year, Lilly has announced 11 acquisitions, more than in 2025 and 2024 combined, according to S&P data."}],[{"start":288.95000000000005,"text":"The group’s announcement in May that it is acquiring three vaccine companies working on treatments for infections like shingles showed it was willing to spend even on medicines with long development timelines, Ricks said. “We have a pretty long runway of growth and cash flow and ability to invest in R&D,” he added. "}],[{"start":306.55000000000007,"text":"Lilly continues to trounce its only rival in weight-loss competition, Novo Nordisk, which was Europe’s largest company in 2023 but has since seen its shares tumble."}],[{"start":316.95000000000005,"text":"As of the first week of June, Lilly’s obesity and diabetes weight-loss drugs totalled 1.6mn US prescriptions, compared with 1.1mn in the US for those of Novo, according to data from Iqvia."}],[{"start":null,"text":""}],[{"start":330.85,"text":"Sales of weight-loss drugs are expected to get a boost in July when the US government starts an unprecedented pilot programme to offer these medicines through Medicare, a government-funded health scheme for older Americans. "}],[{"start":344.65000000000003,"text":"Previously, the US government has not funded weight-loss drugs but their temporary inclusion was part of pricing deals both Novo and Lilly announced with the White House last year. The agreement is scheduled to last until the end of 2027. "}],[{"start":359.6,"text":"Ricks pushed back against the suggestion that inclusion in the Medicare programme would cannibalise Lilly’s current sales."}],[{"start":366.45000000000005,"text":"“It’s not a risk, it’s an opportunity,” he said. “The growth in volume will be way offsetting whatever we would lose marginally in pricing.” "}],[{"start":373.90000000000003,"text":"“We’re actually going to actively work to communicate with seniors who are buying out of their own pocket to switch,” he said. “It’s better for them.” "}],[{"start":390.15000000000003,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1782202850_6380.mp3"}