Lilly's method-of-use patent for Gemzar, which would have given the company patent protection on the drug through 2013, has been invalidated. The company retains a patent on the compound itself, which is set to expire much sooner (Nov 2010). Goldman subsequently downgraded LLY to 'sell' over concerns about future revenue.
Eli Lilly posted better than expected Q1 earnings. Revenues were up 4% to $5.05 billion, and profits were up 23% to $1.3 billion.
Previously, there was no mechanism for generic biologic drugs to be approved - which meant companies like LLY don't face generic competition. But Obama's budget proposes to change that.
The FDA announced that it needs more time to review the application for Eli Lilly's blood thinner prasugrel.
Eli Lilly posted a net income of $958.8 million, compared to $663.3 million last year. Revenue increased by 11 percent to $5.15 billion.
Eli Lilly buys SGX Pharmaceuticals, a biotech with a focus on cancer drugs, for $64 million in cash.
Eli Lilly shares increased by $2.75, or 5.3 percent, to $54.55 after the company announced a strong than expected earnings forecast and analysts upgraded the company to 'equal weight.'
Shares gained 1.9% to $53.49, after Eli Lilly announced earnings expectations above analyst estimates. The company predicted 2008 EPS of $3.85 to $4.00, while analysts expected $3.82.