Home » Bear Case Scenario » Eli Lilly Bear Case Scenario Holds Hands with a Black Swan $LLY, $JNJ, $NVJ, $RHHBY

Eli Lilly Bear Case Scenario Holds Hands with a Black Swan $LLY, $JNJ, $NVJ, $RHHBY

Eli Lilly will release earnings shortly. Ponder if the Bear Case Scenario holds hands with a Black Swan.

Lilly has been steadily losing share in the insulin market. Diabetes is reaching epidemic proportions and insulin has a natural growth curve which they are losing. Novo Norsk is better at marketing and its long-lasting products are consider superior.

Lilly generates enough cash flow to cover dividends and capital expenditures until around 2015. The pipeline shrinks right about there and needs a boost immediately if not sooner.

The patent loss on antidepressant drug Cymbalta will have a leveraged impact on the company’s bottom line due to loss of high margins.

George Gutowski writes from a caveat emptor perspective

 

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