Drugmakers have axed thousands of R&D workers and tightened their belts to weather the patent cliff and other troubles facing their industry, but Eli Lilly ($LLY) CEO John Lechleiter has held firm to his position that cutting expenses alone isn't a solution to the challenges at his company. And he thinks that the way forward for the Indianapolis-based pharma group resides in its pipeline.
Singing a familiar tune in an interview with Bloomberg, Lechleiter said: "I don't think we can save our way out of the enormous challenge we face. The best course is to maintain our focus on advancing our pipeline." He also makes a case for R&D investment in a Forbes commentary posted yesterday afternoon.
Ticktock. The clock is ticking for Lilly, as time is winding down to perhaps the biggest moment of the year for the drugmaker in the second half of 2012 when data from a pivotal study of its Alzheimer's disease drug solanezumab are revealed. Many analysts and industry watchers are giving the program slim chances of success, but a victory would certainly go a long way to replacing revenue from Lilly's drugs that face competition from generic meds.
Sanford C. Bernstein analyst Tim Anderson calls the experimental Alzheimer's drug Lilly's "lottery ticket" that could bring the company $9 billion in revenue if approved, Bloomberg reported. The chilling aspect of that analogy, of course, is that lottery tickets aren't often winners.
In the meantime, Wall Street has been cheering Pfizer ($PFE) CEO Ian Read as he slashes expenses from the drug giant's budget, which he vows will fall by another $1 billion this year.