Where Will Eli Lilly Be in 5 Years?

What a difference five years can make. Just look at Eli Lilly (NYSE: LLY). In April 2020, the drugmaker stood in the shadows to some extent with companies including Johnson & Johnson, Pfizer, and Merck boasting larger market caps. Today, Lilly ranks as not only the biggest pharmaceutical company on the planet but also the biggest healthcare company in the world with a market cap of roughly $718 billion.

But what matters more than Lilly's accomplishments in the past is what the company could do in the future. Where will Eli Lilly be in five years?

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The leader in diabetes and obesity

Despite Lilly's huge success in treating diabetes and obesity, it's not the leader in those markets. That honor belongs to Novo Nordisk (NYSE: NVO), which sells the blockbuster drugs Ozempic and Wegovy for treating diabetes and obesity, respectively. However, I predict that Lilly will be the top dog in diabetes and obesity within the next five years.

Lilly's Mounjaro and Zepbound, which share the same generic drug (tirzepatide), are already giving Ozempic and Wegovy, which also share the same generic (semaglutide), a run for their money. In clinical trials, tirzepatide helped patients lose more weight than semaglutide did.

I also think Lilly's late-stage diabetes and obesity candidates could have greater market prospects than Novo Nordisk's. In particular, retatrutide holds the potential to deliver more weight loss than tirzepatide. Lilly plans to report results from a phase 3 study of the drug later in 2025.

Another late-stage program, orforglipron, isn't as effective as tirzepatide. However, it's a pill rather than an injection like tirzepatide and semaglutide. I suspect there will be a sizable market for orforglipron if it's approved. Lilly intends to file for approval of the drug this year in the U.S. and Europe as a treatment for obesity.

A major player in multiple other markets

Lilly isn't a two-trick pony, though. The company has big opportunities in treating diseases other than diabetes and obesity. I fully expect Lilly will be a major player in multiple other markets five years from now.

One obvious area where Lilly should build on its success is in oncology. Breast cancer drug Verzenio raked in $5.3 billion in sales in 2024. That number will undoubtedly be much higher in 2030. I think Lilly's blood cancer drug Jaypirca will continue to gain momentum in the marketplace. Late-stage candidate olomorasib could also be effective in treating non-small cell lung cancer.

Lilly's already holding its own in immunology with Taltz, which made nearly $3.3 billion in sales last year. Omvoh could carve a niche for itself in the Crohn's disease market. Ebglyss should also be able to rack up success in treating atopic dermatitis.

I expect sales for Alzheimer's disease drug Kisunla will ramp up significantly in the coming years. I'm also interested is seeing how Lily's late-stage Alzheimer's disease candidate remternetug fares in clinical testing.

Last, but certainly not least, tirzepatide could become a medicinal equivalent of a Swiss army knife. It's already approved in treating diabetes, obesity, and obstructive sleep apnea. Lilly is evaluating the drug in phase 2 clinical studies as a potential treatment for metabolic-associated steatohepatitis (MASH), another potentially huge market.

Will Lilly be the first healthcare stock in the $1 trillion club?

I think Lilly will remain the world's biggest healthcare company five years from now. Could it even become the first healthcare stock in the $1 trillion club? The chances are pretty good, in my opinion.

Some investors might think valuation could get in the way, considering that Lilly's shares trade at nearly 33 times forward earnings. However, looking only one year into the future, as forward earnings multiples do, is myopic with a fast-growing company like Lilly. The drugmaker's growth prospects over the next five years make the stock's valuation much more attractive.

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Keith Speights has positions in Pfizer. The Motley Fool has positions in and recommends Merck and Pfizer. The Motley Fool recommends Johnson & Johnson and Novo Nordisk. The Motley Fool has a disclosure policy.