Lilly chief resolves to stick with high-risk pipeline strategy
About the only predictable big headline that Eli Lilly ($LLY) faces this year will be on the fate of its high-risk Phase III program for a new Alzheimer's drug. In a chat with The Wall Street Journal, Lilly CEO John Lechleiter ruled out any major buyouts, repeating a theme that has guided his tenure at the top of the pharma giant.
How about diversifying the company? Nope, says Lechleiter, who only allows that some small deals might make sense. Lilly hasn't done a major league deal in about four years. His chief interest remains steadfast: Pursuing the development of the drugs already in the pipeline. And don't go banging on his door when a company comes into play.
"There are lots of opportunities to do a deal," Lechleiter said. "I don't think we can return to the Lilly of the 1970s, when we were buying up medical device companies…our core is pharmaceutical innovation."
Lilly has promising drugs to bank on, especially in the diabetes field, where it has plenty of experience. But with profits sliding as generic competition continues to heat up, analysts have been wondering how long Lechleiter--who also refuses to tamper with the research budget--will be able to maintain his steady-as-she-goes approach to new product development. A readout on the Alzheimer's drug solanezumab later this year could prove a major test of Lechleiter's resolve. But don't look for any change of strategy under the resolute chief.
"Innovation requires long-term thinking, especially in an enterprise that typically requires more than a decade to bring a new medicine to patients," Lechleiter noted in a recent speech, as reported by Inside Indiana Business. "We've stayed the course through challenging times in the past by following the science, and we need to maintain that same perspective today."
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