Eli Lilly and Co

NYSE:LLY

Earnings Call Transcript 2022-Q2

[Operator]

Ladies and gentlemen, thank you for standing by. Welcome to the ADA Investor Update. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session with instructions being given at that time. [Operator Instructions] As a reminder, today's conference is being recorded.

And I would now like to turn the conference over to our host, Lauren Zierke. Please, go ahead.

[Lauren Zierke, Senior Director of Investor Relations]

Good morning. Thank you for joining us for Eli Lilly and Company's obesity and diabetes update at ADA. I'm Lauren Zierke, Senior Director of Investor Relations. Joining me on today's call are Mike Mason, President of Lilly Diabetes; Dr. Dan Skovronsky, Chief Scientific and Medical Officer; Dr. Jeff Emmick, Vice President of Diabetes Product Development; Dr. Ruth Gimeno, Vice President of Diabetes Research and Clinical Investigation; and Jamie Croaning, Global Development Leader for tirzepatide.

During this conference, we anticipate making projections and forward-looking statements based on our current expectations. Our actual results could differ materially due to several factors, including those listed on slide two. Additional information concerning factors that could cause actual results to differ materially is contained in our latest Form 10-K and subsequent filings with the Securities and Exchange Commission.

The information we provide about our products and pipeline is for the benefit of the investment community. It is not intended to be promotional and is not sufficient for prescribing decisions.

I'll now turn the call over to Mike to provide some introductory comments.

[Mike Mason, President of Lilly Diabetes]

Thanks, Lauren, and thank you to everyone for joining us today and for your interest in Lilly. As we continue to develop potentially novel treatment options, it's an incredibly exciting time for innovation in diabetes and obesity treatments.

During this call, we'll share updates on pipeline assets that have tremendous potential, to further our mission to deliver breakthrough outcomes for people living with diabetes and obesity. We will highlight new data presented at the ADA for these programs, focusing significant time on the SURMOUNT-1 trial results.

But first, I'd like to spend a few minutes highlighting Mounjaro's recent approval, as well as our strategic vision to discover medicines that could potentially deliver breakthrough outcomes in metabolic diseases.

Lilly has been a leader in the fight against diabetes for nearly a century. Over the past decade, you have seen us continue to raise the bar on innovation, developing and launching best-in-class medicines to address unmet needs for patients around the world living with this burdensome disease.

Moving to slide four. We are thrilled that Mounjaro, the trade name for tirzepatide, is now approved in the US as the first and only GIP and GLP-1 receptor agonist for the treatment of adults with type 2 diabetes.

I am proud of the efforts by our Lilly team to bring this medicine to people live with diabetes. I'd also like to share our sincere appreciation for the individuals who help conduct and those who participated in our SURPASS clinical trials.

Results from the tirzepatide type 2 diabetes clinical program surpassed our expectations, displaying significantly greater A1c and weight reduction versus all competitors in the SURPASS clinical trial program.

Our commercial team is excited and well prepared to launch Mounjaro with a similar, yet enhanced patient-centric approach like we used with Trulicity. Consistent with this approach, we'll support people living with diabetes initiating Mounjaro as we work to build broad access through offering samples where accepted and co-pay assistant programs. One sample pack will include four 2.5-milligram pins, which will provide four weeks of initial treatment before they use an initial prescription for transition to the five-milligram dose in their second month of treatment. This approach should simplify the start and initial dose escalation experience. We're also offering co-pay assistant programs to reduce patient out-of-pocket cost as little as $25 per month for eligible commercially insured patients.

Discussions with national payers for Mounjaro formulary access are underway. We are pleased to announce that Mounjaro is already preferred on Humana's Medicare Part D formulary and ESI's commercial national preferred formulary.

As we speak, shipment to wholesalers are underway, and pharmacies will begin to see supply as prescriptions are written. We do not anticipate supply constraints to the US launch of Mounjaro or ongoing supply of Trulicity under a reasonably broad range of demand scenarios. We are looking forward to people living with diabetes realizing the benefits of Mounjaro.

At Lilly, we focus our R&D efforts at the intersection of unmet medical need and breaking science across our therapeutic areas. At times, that pursuit creates opportunities to impact health outcomes beyond what was previously possible. Tirzepatide as well as our incretin pipeline potentially provides the opportunity to transform diabetes and obesity care given the profound weight loss and associated metabolic health benefits. We experienced a similar opportunity with Jardiance as breakthrough clinical evidence demonstrated cardio, renal and metabolic benefits beyond A1C control.

As you can see on slide 5, we are building on our foundation of improving and simplifying glycemic control in diabetes to an expanded focus to potentially disrupt diabetes and obesity progression. Based on the remarkable SURMOUNT-1 results, we are excited about our potential future tirzepatide obesity indication and the opportunity to improve the lives of people living with obesity.

Moving to slide 6. Our goal is to revolutionize obesity care and change the lives of people living with obesity by raising the bar for treatment and setting a new standard of care, including recognition that this is a chronic disease. To change the treatment paradigm in obesity, we are looking to drive quality, patient centric care, improved morbidity and mortality outcomes and advanced access for basic medicines.

Slide 7 highlights the significant unmet need that remains. Obesity is the number one risk factor for type 2 diabetes. And of those diagnosed with diabetes, half are not meeting their treatment goals for glucose lowering. In the United States, over 100 million people live with obesity. However, fewer than 3% are pharmacologically treated. The global economic impact associated with obesity is over $1 trillion, and obesity is a cause of nearly one out of five adult deaths. Our mission is to change these outcomes. We believe we have the medications, the people, the capabilities, the determination and passion to accomplish this mission for people living with diabetes and obesity. We look forward to continuing our century-long fight against diabetes while beginning our new fight against obesity.

Now I'll turn over the call to Dr. Jeff Emmick to provide an overview of recently presented tirzepatide SURMOUNT-1 data in patients without type 2 diabetes who have obesity or overweight.

[Jeff Emmick, Vice President of Diabetes Product Development]

Thanks, Mike. It was certainly a great ADA meeting where the focus was clearly on the importance treating people living with obesity and the impact that could have on both diabetes and complications. And along those lines, we were very excited to have had the opportunity to share detailed results from SURMOUNT-1 and ADA, particularly so soon after our top line readout, which was just less than six weeks ago.

We were also pleased to see the SURMOUNT-1 results published in the New England Journal of Medicine in conjunction with our ADA presentation, along with a very important editorial.

Now let me provide some background on the SURMOUNT-1 study, including baseline characteristics. Slide 9 shows the trial design for SURMOUNT-1, which was designed to evaluate treatment with tirzepatide compared to placebo and provide weight reduction and safety data for people without type 2 diabetes with obesity or overweight and at least one comorbidity. The trial included over 2,500 participants evaluating the 5-, 10- and 15-milligram doses of tirzepatide and placebo for 72 weeks of treatment with the same dose escalation that we used across our SURPASS program and is obviously well known to most of you.

SURMOUNT-1 will continue through 170 weeks, six weeks to evaluate whether tirzepatide can slow the time to onset of type 2 diabetes for those participants who had pre-diabetes at the time of entry into the study as well as the impact on body weight reduction over a longer period of time. We believe this could be additional important information for both patients and physicians.

Slides 10 and 11 summarize baseline characteristics related to both demographic and clinical parameters. SURMOUNT-1 was a global clinical trial with sites in nine countries. And related to what I have already mentioned about the pre-diabetes extension of approximately 44% of the total trial participants or 41% of the trial participants had pre-diabetes at baseline. And approximately 44% of the total trial participants were enrolled in the US.

We are pleased with the diversity of our US cohort, where 24% of the participants were Hispanic or Latino and nearly 20% were other minority group members. As is common for chronic weight management studies, a higher percentage of participants were female than male, but we still had very strong male representation in the study. In terms of other key clinical characteristics, mean baseline weight was 105 kilograms or 231 pounds. And now if we move to Slide 12, you can see the weight reduction curves through 72 weeks.

As we previously announced, tirzepatide achieved the first co-primary endpoint of mean change in body weight from baseline compared to placebo. Participants on the 15-milligram dose achieved an average weight reduction of 22.5% with the efficacy S demand analysis, which translates to 52 pounds.

Weight reduction was evident across all three doses during the first 12 weeks of dosing. Additionally, in a pre-specified analysis that evaluated pooled data from the 15 and 10-milligram doses, participants achieved a weight reduction of more than 13 kilograms or approximately 29 pounds at just 20 weeks. And I will remind you that for the 15-milligram dose, that is right at the time they achieve their maximum dose of 15 milligrams.

We look forward to seeing the results of the trial extension as that will assess the longer term impact of tirzepatide on weight reduction through three years in people with prediabetes. We are also very pleased that all prespecified cardiometabolic key secondary endpoints were achieved in this trial.

As we previously announced, tirzepatide met the second co-primary endpoint of participants achieving at least 5% body weight reduction in the 10 and 15-milligram treatment arms.

Slide 13 shows the percentage of participants reaching prespecified weight reduction targets at 72 weeks based on the efficacy of demand. You can see the impressive results on all targets, but particularly at the highest dose, where 63% of participants achieved 20% or greater weight reduction compared to only 1% on placebo.

At ADA, we also presented data from an exploratory analysis showing that roughly 40% of patients achieved at least a 25% weight reduction on the 15-milligram dose compared to less than 1% of patients on placebo. Additionally, the physical functioning assessment for precisions on tirzepatide improved compared to placebo as measured by the SF-36 V2 physical functioning domain score.

On slide 14, you can see how fat body mass and lean body mass have evolved through the 72 weeks of the trial. Pooled data for tirzepatide shows that fat body mass was reduced by nearly 34%, while lean body mass was reduced by nearly 11%. Therefore, participants taking tirzepatide experienced a nearly threefold greater reduction in fat mass than lean mass, which translates into improved overall body composition following treatment.

It is important to note that when you have a reduction in fat mass, some reduction in lean mass is expected as well as evidenced even in those randomized to placebo. The reduction in lean mass is expected as the body does not need as much muscle mass to support its weight following a significant loss in fat mass. And this finding is consistent with what has been with observed with late loss from both intensive lifestyle modifications or bariatric surgery.

Slide 15 shows the impact of tirzepatide on waste circumference. A decrease was observed across all three doses, but the data for the 10 and 15-milligram doses were particularly noteworthy, given that we observed more than a 7-inch or almost 20-centimeter reduction. This is indicative of a reduction in visceral fat mass and we will provide additional data regarding the impact of tirzepatide on visceral fat later this summer.

Moving to slide 16, you can see that tirzepatide led to clinically meaningful reductions in systolic blood pressure across all doses as represented on the left side of the slide, with maximal reduction reaching approximately 8 millimeters of mercury at the 15-milligram dose and pretty similar reductions for the five and 10-milligram doses as well.

Significant decreases in diastolic blood pressure were also seeing in findings as it relates to the both blood pressure and the lipids are all consistent with what we observed across our SURPASS Type 2 diabetes program and that we have discussed previously.

These are just a few of several cardiovascular biomarkers where we see favorable effects and our ongoing and planned outcome studies will further assess the impact of these improvements in cardiovascular biomarkers on both morbidity and mortality.

Shifting to safety and tolerability on Slide 17, the overall safety profile of tirzepatide and SURMOUNT-1 was similar to incretin-based therapies approved for the treatment of obesity and also very similar to what we observed across the SURPASS program. Tirzepatide was generally well tolerated with the most common adverse events being gastrointestinal, namely nausea, vomiting, diarrhea and constipation.

And as was observed in the SURPASS program, the gastrointestinal adverse events are usually mild to moderate in intensity and generally occur during the dose escalation period. Study drug discontinuation due to gastrointestinal adverse events was infrequent, occurring in less than 5% of patients randomized to tirzepatide, and we are also encouraged that the incidence of gastrointestinal adverse events was similar across the three doses, again, supporting what we have said previously and the observation that most occurred during the dose escalation.

Serious adverse events were also balanced across the tirzepatide in treatment arms as well. It is noteworthy that the overall treatment discontinuation rates range from approximately 14% to 16% in the tirzepatide treatment arms compared to over 26% for placebo. We believe the greater percentage of patients discontinuing treatment on placebo likely reflects the limited efficacy of diet and exercise alone even in this clinical trial setting and highlights the significant unmet need for people with obesity or overweight.

The efficacy, safety and tolerability data in SURMOUNT-1 truly exceeded our expectations. Similar to the SURPASS program, we were also extremely impressed with the performance of the 5-milligram dose. And we're delighted to see the extremely robust results that were delivered with the 10 and 15 milligram doses as well.

Slide 18 just shows our robust tirzepatide clinical development program, where our goal is to not only evaluate tirzepatide in diabetes and obesity, but following on what Mike covered previously, to look at its effect in related comorbidity and metabolic diseases. Our next major clinical milestones are the initiation of additional Phase III trials, including obstructive sleep apnea, and the morbidity and mortality and obesity trial that we announced last December, which is expected to start later this year.

You can also expect to read out as the subsequent SURMOUNT-2, 3 and 4 chronic weight management studies in the middle of next year. Based on our existing robust dataset we plan to engage with regulators to discuss whether it's a potential path forward for registration of chronic weight management based on SURMOUNT-1 combined with the data from our very solid SURPASS program.

We expect to have an update on this in the second half of this year. And now let me shift to some other exciting tirzepatide data that we revealed at ADA as we seek to better understand tirzepatide's mechanism of action and the exciting possibilities this molecule could provide for patients.

Slide 20 summarizes the renal data, we presented at ADA related to the SURPASS-4 trial. As a reminder, SURPASS-4 compared the effects of tirzepatide insulin larging in participants with Type II diabetes and high cardiovascular risk. In a prespecified exploratory analysis, tirzepatide reduced the risk of renal disease by more than 40% as judged by a common composite of endpoint of kidney function that included macroalbuminuria, eGFR decline, end-stage renal disease and renal death. Compared to insulin glargine, tirzepatide reduced albuminuria and slowed the decline of eGFR, two key measures for improving kidney health. Importantly, these effects were independent of SGLT2 use, suggesting a potential kidney benefit for tirzepatide on top of SGLT2 inhibitors.

And now I'll turn over the call to Dr. Ruth Gimeno to discuss further insights into tirzepatide mechanism of action and then review select early phase molecules.

[Ruth Gimeno]

Thanks, Jeff. We have a broad effort to understand the mechanisms that underlie the efficacy we see with tirzepatide, and this effort includes both preclinical studies as well as four dedicated clinical mechanism of action trials.

At ADA, shown on slide 21, we presented a new analysis of our first clinical mechanism of action study that compares the effect of tirzepatide and semaglutide on insulin sensitivity as a function of weight loss.

In this study, tirzepatide achieved a 63% improvement in insulin sensitivity, roughly two-fold more than semaglutide. Per unit weight loss, the increase in insulin sensitivity was more pronounced for tirzepatide, suggesting a weight independent insulin sensitizing component. This is consistent with preclinical data that show that GIP alone is a potent insulin sensitizer in the absence of weight loss.

The enhanced insulin sensitivity conferred by tirzepatide, together with its ability to improve beta cell function may contribute to the strong and durable glycemic control shown in the SURPASS program. Specifically, improvements in insulin sensitivity will decrease insulin demand and thus are expected to improve beta cell survival. We look forward to seeing data from longer-term studies with tirzepatide to better understand its potential for durable glycemic control.

On slide 22, we show the effect of tirzepatide on food intake. In our first mechanism of action study, tirzepatide decreased food intake by approximately 300 calories in a test meal, and we observed a market decrease in appetite and hunger as well as an increase in satiety.

The observed changes in food intake, however, may not completely explain the weight loss received with tirzepatide, particularly when compared to semaglutide. In preclinical models, tirzepatide protected against decreased energy expenditure after weight loss, which is different from what we see with selective GLP-1 receptor agonist.

We are conducting two dedicated clinical mechanism of action studies to further examine the effects of tirzepatide on components of appetite and energy expenditure, and we look forward to sharing the results once available. An ability to increase energy expenditure would be a highly desirable feature since this will be expected to translate into more durable weight loss.

Now, let me shift to data presented at ADA on other assets in our pipeline through which we aim to raise the bar for innovation and improve metabolic health. First, I will discuss our early phase insulin portfolio, including our oral GLP-1 receptor non-peptidic agonist on slide 24, which we licensed from Chugai in 2018. This is a selective small molecule agonist at the GLP-1 receptor with partial and biased activity, similar to tirzepatide's action on the GLP-1 receptor.

Our goal for this molecule is to enable once-daily dosing with no food or water restrictions, which would make it convenient and easy to use. At ADA, we presented data from studies in healthy volunteers. I would like to highlight this molecule's strong PK profile.

The half-life range from 24.6 to 35.3 hours, more than enough to support once daily dosing and roughly four times longer than the danuglipron. Peak-to-trough ratio at steady state for our molecule is approximately two, a profile comparable to injectable GLP-1 receptor agonist.

The long half-life, low peak-to-trough ratio and low PK variability are expected to result in a favorable GI tolerability profile comparable to contemporary injectable GLP-1 receptionist. A 12-week proof-of-concept trial in type 2 diabetes has shown the potential for this molecule to match both HbA1c and weight reduction efficacy of injectable GLP-1 receptor agonist with a similar safety profile to the injectable class.

We plan to present the data from this trial later this year at EASD. Phase II studies in type 2 diabetes and obesity are ongoing, with readouts later this year, allowing for a potential advancement of this molecule into Phase III in 2023.

As we move to slide 25, I will provide additional detail on our GIP, GLP-1 and glucagon receptor triagonist, or GGG, highlighting the data we have presented at ADA. In this Phase I trial, which was conducted in patients with type 2 diabetes using dulaglutide as an active comparator, we saw dose-dependent rate reduction in participants treated with GGG of up to 8.6 kilograms or 19 pounds over 12 weeks.

This is almost double of what we observed with tirzepatide over a similar period of time in a similar patient population. While a decrease in food intake likely contributes to this weight loss, we believe that there will also be a strong contribution of energy expenditure, since appetite scores were not significantly different between tirzepatide and dulaglutide in the study -- and between GGG and dulaglutide in the study.

On the right side of the slide, you can see the HbA1c benefit of GGG, again as compared to dulaglutide. HbA1c decreased by up to 1.9% at dose levels above 3 milligrams. Importantly, there was no loss of glucose control even at high doses of GGG. Consistent with our expectation for incretins, we saw augmentation of insulin response following an oral glucose tolerance test, resulting in a significant decrease in postprandial glucose load.

Our GGG program has Phase II studies underway in type 2 diabetes and obesity, and we are also assessing its potential utility in NASH. Both studies are expected to read out internally by the end of 2022.

Slide 26 shows the results of our multiple ascending dose trial of oxyntomodulin, now known by its new name, Mazdutide, a dual glucagon and GLP-1 receptor agonist in patients with type 2 diabetes that we shared at ADA this year.

We see weight reductions of 11.2 kilograms, which is a 12.7% change from baseline at the high dose of the 16 weeks of treatment. Mazdutide also showed a favorable impact on lipids and a reduction in waste circumference.

Importantly, we also see HbA1c improvements with a decrease up to 1.92% from baseline, as well as significant reductions in fasting glucose at both low and high doses of this molecule. Obviously, Mazdutide is earlier in development compared to GGG triagonist.

Our goal is to advance the best molecule for patients into late-stage development, using clinical data for decision-making and tirzepatide as the high bar for differentiation. We expect to announce next steps in 2023 for both GGG and Mazdutide after completion of the GGG Phase II study and careful review of all data.

Next, I'd like to discuss our weekly basal insulin FC, also known as BIF. Our goal for this asset is to develop a weekly basal insulin that optimizes both efficacy and safety and provides a simple solution for people with diabetes. This has a best-in-class PK profile with a peak-to-trough ratio of approximately 1.14, resulting in very low day-to-day variability. We anticipate that this will translate into consistent and predictable glycemic control. We have completed a comprehensive Phase 2 program and are very pleased with the results.

Last year at Endo, we discussed data from our basal switch study in patients with type 2 diabetes, where we found non-inferior glycemic control with lower rates of hypoglycemia for BIF compared to insulin degludec. At ADA this year shown on Slide 27, we presented data from our second Phase 2 study in insulin-naive patients with type 2 diabetes. This trial, which again compares BIF to insulin degludec, employed a stringent fasting glucose target of less than 100 mg per deciliter for both groups.

BIF achieved a glycemic control very similar to insulin degludec, importantly, with no imbalance of hypoglycemic events. In fact, when assessing time below range by CTM, we saw a trend towards less time spent below 51 mg per deciliter, which is the threshold for Level 2 hypoglycemia.

Our third Phase 2 study, which compared BIF to insulin degludec in patients with type 1 diabetes was similarly encouraging and will be presented at EASD later this year. The combined efficacy and safety data from our Phase 2 program are highly encouraging and have informed our Phase 3 design. Our Phase 3 program called QUINT, consists of five global registration studies in relevant diabetes populations and treatment regimens, and we are pleased to report that two of these studies, QUINT-2 and QUINT-3 have initiated with the remaining three studies expected to start data this year.

Slide 29 summarizes our current development portfolio for diabetes, obesity and related indications. In addition to our weekly insulin and next-generation ingredients that I highlighted today, we have several novel targets focused on diabetes, obesity and outcomes related to obesity and metabolic disorders. While we focus today largely on our Phase 3 and Phase 2 pipeline, I am encouraged by the diverse set of assets in preclinical and Phase 1 development.

We moved our long-acting amylin receptor agonist and our DACRA molecule into Phase 1 development earlier this year, and we are progressing PYY in Phase 1 as well. These assets could be combined with tirzepatide to potentially achieve even more weight loss and additional benefits.

As Mike shared earlier, we are broadening how we think about the management of metabolic health to include not just obesity but also related disorders such as cardiovascular disease and heart failure, where we build on our expertise and the recently launched indications for dulaglutide and empagliflozin. We look forward to updating you as our robust early and late-stage pipeline progresses.

I'll now turn the call back over to Mike to provide some closing comments.

[Mike Mason, President of Lilly Diabetes]

Thanks, Ruth. We're proud of the impact that Trulicity had on patients with type 2 diabetes and with the recent approval of Mounjaro, we are looking forward to helping even more patients based on the superior A1C reduction and significantly greater weight reduction versus all comparators in the Phase 3 program.

Mounjaro is the first of five potential near-term launch opportunities for Lilly to fuel our already strong growth trajectory. Jardiance in collaboration with Boehringer Ingelheim remains the most prescribed branded oral diabetes medication. And the evidence for cardiovascular, renal and metabolic benefits continues to grow with approvals for HFrEF and HFpEF indications as well as the early stop for in its Phase III chronic kidney disease study due to clear positive efficacy, and further reinforced by the final analyses from the EMPRISE real-world study presented at the ADA.

The final US data showed that Jardiance was associated with reduction in the risk of hospitalization for heart failure of 50% versus DPP-4 inhibitors and 30% versus GLP-1 receptor agonist, as well as a relative risk reduction of 40% for all-cause mortality compared with DPP-4 inhibitors in a subset of people with Medicare coverage.

Just as Jardiance's impact has expanded beyond its initial type 2 diabetes indication, we aim to revolutionize obesity care and improve patient outcomes with tirzepatide based on the results we saw in the SURMOUNT-1 trial as well as future studies in obesity and overweight in areas like heart failure, cardiovascular disease and sleep apnea. And we won't rest as we work to raise the bar for patients, as you heard today, with potential new medicines like oral GLP-1, GGG, Mazdutide and BIF.

This concludes our prepared remarks. Now I'll turn the call over to Lauren to moderate the Q&A session.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks, Mike. We’d like to take questions from as many callers as possible. So, we ask that you limit your questions to two or a single question with two parts. Kiwi, please provide the instructions for the Q&A session, and then we’re ready for our first caller.

[Operator]

Thank you. [Operator Instructions] Our first question will come from the line of Seamus Fernandez of Guggenheim. Please go ahead.

[Seamus Fernandez, Guggenheim]

Great. Thanks so much for the question. So maybe the first question is for Mike. Mike, we're seeing the acceleration of Ozempic scripts come through, our 13-week look as NBRx now 100% growth year-over-year. I'm wondering what your thought is as it relates to the introduction now of tirzepatide or Mounjaro? And if you see a further acceleration potential in the overall GLP-1 category ahead given the availability of Mounjaro, or is it really more a market share gain at this point at least until we get more clarity on reimbursement as it relates to obesity? It just seems like this continues to accelerate, and there may be further upside for the class as it relates to NBRx.

The second question is actually on Glucagon specifically. Just hoping to get a better understanding of the safety dynamics. There was a paper published that was highlighted with Novo Nordisk attempts at Glucagon co-agonist with GLP-1. And there were a number of safety issues cited in that paper. But I just wanted to know if you're seeing with either your GGG or with Mazdutide seeing any of those types of potential safety issues with the Glucagon mechanism or if you feel actually that those are molecule-specific issues? Thanks.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks, Seamus. We'll start with Mike on the GLP-1 class question and then we'll shift to Ruth for the glucagon question.

[Mike Mason, President of Lilly Diabetes]

All right. Thanks Seamus. I appreciate the question. As we take a look at this, we see both short-term and long-term opportunities to grow the GLP-1 or Ancrogen class with the new mechanism that tirzepatide offers. We do think there's opportunity to grow in the diabetes segment as I think there's many more patients that can benefit from Ancrogen that's being used currently.

And then long-term, obviously, as you indicated, I think obesity affords the opportunity to further have sustained growth. I think it's going to take time for the obesity market to develop. I think we'll see acceleration in the market with semaglutide and tirzepatide, but this is -- we're in it for the long range. You could tell from both -- not only from our investment behind our clinical trials that we're doing in people who have obesity and cardiovascular disease, sleep apnea, HFrEF or HFpEF, some work in prediabetes that we believe we -- it's important for us to really identify this and solidify this as a chronic disease, and we're going to build the evidence to do that.

That said, I do think even only 20% of people who live with obesity today have access, that still amounts to 20 million people in the US that will have access to commercial insurance by the time that -- and it probably is higher by the time we get to launch. So, I think there's a good opportunity for us to grow at launch and that opportunity will grow over time.

[Ruth Gimeno]

Yes. And to comment on glucagon, glucagon is obviously a very powerful pharmacology test, effects on food intake, energy expenditure, but also direct effects on the liver as well as direct effects on the kidney, some very nice blood pressure lowering.

I think as with any co-agonist molecule; the ratio matters a lot. So, how you balance glucagon pharmacology with GLP-1 will be important. As we look at our molecules, GGG triagonist as well as Mazdutide, we actually have not observed any of the types of safety issues that have been reported before. Obviously, it's still early in development, and we'll learn more as we take these molecules through additional stages of development.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks Mike and Ruth. Okay, Kiwi, we ready for our next caller.

[Operator]

And that will come from the line of Chris Schott with JPMorgan.

[Chris Schott, JPMorgan]

Great. Thanks so much and congrats on the data this weekend. Just two for me. Can you first maybe talk about duration of therapy in obesity and how you're thinking of that just in light of the SURMOUNT data and how you see patients and physicians approaching this once the drug is available?

And then the second question was on your oral GLP-1. I guess based on the profile that's shaping up from the data you have thus far, what role do you see that product playing in the market relative to tirzepatide given the benefit you're seeing with the injectables? So, I'm just trying to get a sense of basically how excited are you about the oral segment of the market here versus just focusing on the injectables? Thanks so much.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks Chris. We'll start off with Mike on the duration of obesity question and then shift to Ruth on the oral GLP-1 question.

[Mike Mason, President of Lilly Diabetes]

Chris, thanks for your question. Thanks for your comments. On the duration of therapy, we believe that this is a chronic disease and a chronic medication, and the patients are going to have to stay on therapy long-term in order to initially get to effect to then maintain the effect long-term.

So, our approach will be making sure we support individuals who live with obesity during their journey to make sure that there's compliance and adherence to treatment, which is really important.

[Ruth Gimeno]

Yes. And for the oral NPA molecule, obviously, it's an oral molecule. We feel it's an important option for patients to have a simple, easy-to-use daily medication. I think there's going to be a lot of patients that may not be willing to go into injectable therapies right away.

We actually think that our NPA molecule might be -- have a profile that is very similar to high-dose semaglutide. I think that will be a very attractive profile for a patient population that maybe is not quite ready to go to an injectable. I don't know, Mike, if you want to provide some additional comments.

[Mike Mason, President of Lilly Diabetes]

No, I think the -- as we think about the -- both the type 2 diabetes market as well as the obesity market, there's certain segments in there that do prefer to be on orals versus injectables. And so, I think, it's good to have a complete portfolio of products for people who live with obesity and diabetes. So we're excited and blessed to have good options in both the injectable and oral fronts.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the questions. Next caller, please.

[Operator]

We'll go to the line of Steve Scala with Cowen.

[Steve Scala, Cowen]

Thank you very much. A couple of questions. Does Lilly plan to launch a separate brand of tirzepatide for obesity at a different price point? And either way, can you give us examples of drugs sold under two brands at the same doses, but at substantially different prices. So that's the first question. The second question is, can SURMOUNT-1 be sufficient to get a diabetes prevention label claim? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks, Steve. We'll go to Mike for both of those questions.

[Mike Mason, President of Lilly Diabetes]

Yes. So, first of all, we're not going to release any of our pricing on obesity until after we get approval for the obesity indication, so I can't really provide any detail on that. On the question around, do we think we can get approval with SURMOUNT-1 data. I mean, it's consistent with what Jeff had said earlier is, we're happy to engage with regulators on that dialogue, and we'll have an update in the second half of the year.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Next caller, please.

[Operator]

We'll go to the line of Geoff Meacham with Bank of America.

[Geoff Meacham, Bank of America]

Hi, guys. Thanks so much for taking the question and hosting the event. I just have a couple of quick ones on commercial and the clinical. For Trulicity, the question is, what's been the adoption and payer attitude towards the prediabetic population, just meaning those with risk factors, but perhaps have normal A1c. And then obviously, could this be different for tirzepatide?

And then on GGG, if you build the -- build on the weight loss that you see with tirzepatide and have three mechanisms, where do you think is the upper limit of weight loss that's reasonable before you could run into metabolic concerns and the like? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks. We'll go to Mike first on the commercial question and then follow up with Ruth on the GGG question.

[Mike Mason, President of Lilly Diabetes]

Okay. And let me -- I think the question was, what's the opportunity in prediabetes with tirzepatide, we're -- as we take a look at our -- the obesity indication, there are many people who live with obesity, who also has prediabetes. We saw that in the SURMOUNT-1 data. And some of the data that was most remarkable for me is the fact that people who had prediabetes in that study at like 96% of them returned to tunable glucose levels.

So I think as I talk to payers and discussions, there's a number of payers and healthcare professionals will say, what's that trigger to begin to treating individuals. Some may want to see kind of the start of a metabolic health disease journey. And I think prediabetes can be an important treatment trigger for those who live with obesity. So, I think in the SURMOUNT-1 data, I think it showed that tirzepatide can provide a good ability to help them in many ways. And so, I do think there's an opportunity as we hopefully get some out in and approved in totality and get that indication in the marketplace at some time that there will be opportunity to talk to healthcare professionals about people who live with obesity and prediabetes.

[Jeff Emmick, Vice President of Diabetes Product Development]

This is Jeff Emmick. I was just going to add, Mike, that as we announced late last year, and I mentioned on the call, we're also planning the MMO, morbidity and mortality and obesity trial, which again will be a large outcome trial in patients with overweight or obesity, but without Type II diabetes. As you saw in SURMOUNT-1, we had over 40% of the patients that had prediabetes. So, we expect to have a large cohort of patients with prediabetes and SURMOUNT MMO as well. And certainly, that will give us the opportunity to follow that cohort over an even longer period of time than SURMOUNT-1.

[Ruth Gimeno]

And with respect to how much -- what's the upper limit of weight loss, I think it depends where you start from. So, the way I think about it, you have about 9% of the adult US population have a PMI more than 40 qualified for bariatric surgery. If you do the math, and so you want to bring these people down to normal body weight, that's probably 30% to 35% weight loss. And we know that for each weight loss medication, there's going to be a range of responses.

So, I think what we're looking for is obviously medicines that give us a larger degree of weight loss and – but also looking for things that allow us to give us more durable weight loss and maybe also provide different offerings to individuals who maybe need something that increase energy expenditure more or something that is a primarily to food intake. So, we actually see quite a bit of space there.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Kiwi, next caller please.

[Operator]

We'll go to the line of David Risinger of SVB Securities.

[David Risinger, SVB Securities]

Great. Thanks very much and let me add my congrats on the data as well. So clearly, the dual mechanism that tirzepatide offers has better GI tolerability cross-trial than the single mechanism of GLP-1 dosed up with Wegovy. So I have two questions on this. First, we just hosted an obesity thought leader call and the expert was surprised that the discontinuations were roughly similar, approximately 6% for tirzepatide pooled across doses versus Wegovys 7% and despite the better GI tolerability profile for tirzepatide. So, I was hoping that you could comment on that, whether you had any for your trial? Whether you had an observation on why that might have been the case for your trial? And then separately, how should 1 think about the tolerability impact of adding Amlin on top of 2.4 milligrams of GLP-1? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Great. Thanks for the first question. We'll go to Jeff on tirzepatide tolerability and then we'll shift to Ruth for the M1 tolerability question.

[Jeff Emmick, Vice President of Diabetes Product Development]

Yes, David, thanks for the question. It's -- again, we're always careful to -- in cross-trial comparisons. We were very pleased with the GI tolerability profile we saw across the doses in SURMOUNT-1, and it's very, very consistent with what we see in the Type II diabetes patient population, typically have seen with all of the incretins and slightly higher numbers in patients without type 2 diabetes. But I'd say, we're very pleased with what we saw, including discontinuation for adverse events, GI adverse events. And as mentioned, we're generally 5% or less. I can't comment further on other differences, trials done in different periods of time. As I think you well know, SURMOUNT-1 was done throughout COVID as well. And COVID certainly had some impact on the trial that's commented on in the New England Journal paper. So it's hard to draw any conclusions beyond that.

[Ruth Gimeno]

Yeah. And with respect to Amylin, obviously, Amylin has GI side effects by itself. So as you combine it with the GLP-1, there's going to become a limit where basically GI tolerability will limit how much you can dose this up. As you know, we have Amylin molecules in Phase I, and we're actually very interested to see what this will look like on top of tirzepatide because there is a lot of literature on the GIP component actually counteracting some of the note. So it will be interesting to see how that plays out.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Next caller, please.

[Operator]

We'll go to the line of Tim Anderson of Wolfe Research.

[Tim Anderson, Wolfe Research]

Thank you. I have a question on resourcing behind Trulicity. So will it be the same field force that promotes Mounjaro and Trulicity. And then will you keep the same level of resourcing on Trulicity, meaning field force, DTC and that sort of thing? I'm trying to think about how Mounjaro's ramp might impact Trulicity. And I would normally assume you wouldn't promote an active switch campaign, but you did have surpassed the CVOT that's head-to-head of the two drugs running that doesn't report out for a while. So trying to think about this from a net franchise basis? And then second question is just obesity with tirzepatide ex-US, what's the likely regulatory path? And do you think the payer environment will be more or less accommodating than what it's likely to be in the US?

[Lauren Zierke, Senior Director of Investor Relations]

Great. We'll go to Mike for both of those questions.

[Mike Mason, President of Lilly Diabetes]

Yeah. So for resourcing, as we look at our approach across our incretin portfolio, which we're blessed to have, I mean our focus is going to be on growing the class as well as growing our share within the class. And so we'll take an approach where, obviously, tirzepatide will be our lead incretin and lead promotional product. We'll still have some residual Trulicity promotion that will occur. I mean the net resources will be a bit higher than where we are today. But our goal is not just to say, we have a strict focus on converting Trulicity patients over tirzepatide. We really kind of resist that urge to look internally.

We're always in a good place when we can stay focused on what's best for patients. And so we'll promote to those patients best be helped by tirzepatide. That will naturally organically converse one patient that would have gone on to Trulicity over tirzepatide. And so you will see some – some switching that will happen, but we won't force that. It just happened organically as physicians are trying to pick the right product for the right patient.

Regarding the obesity indication outside, we're confident in the ability to get approval for obesity in many markets outside the US. And every market is unique OUS. We do think we have the ability either through a cash patient or potentially in some segments – in some countries, getting obesity reimbursed may not be for the full BMI range of 27-plus or 30 and above. It may be a higher BMI setting, but we do believe we can get reimbursement for some patients who live obesity and then work to expand that long term.

[Jeff Emmick, Vice President of Diabetes Product Development]

And the only thing I would add is from a clinical trial perspective, obviously, our SURMOUNT program TAM is global. And then we actually have specific Phase 3 trials ongoing in both China and Japan, given some of the different definitions around obesity there. So we truly are targeting OUS registration.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Kiwi, next caller, please.

[Operator]

We'll go to the line of Umer Raffat of Evercore ISI.

[Mike DiFiore, Evercore ISI]

Hi, guys. This is Mike DiFiore in for Umer. Once again congrats on the data and thanks so much for taking my question. Two for me. Earlier in the call, you made a quick comment on being on the Medicare Part D formularies. If you could just please clarify that. And more broadly, your thoughts on the evolution of the payer landscape, obesity, specifically Medicare, could there be a scenario where, say, your competitors cardiovascular outcomes trial is overwhelmingly successful, yet CMS will not open up coverage and why that may be the case?

And separately, on your GGG and oxyntomodulin assets, back at your December Investor Day, you said that each is a standalone project and it's unclear whether both of them will move forward, GGG looks like it may have an edge on efficacy with roughly comparable safety to oxyntomodulin. So at this stage, has Lilly made a formal decision to prioritize either one? And if not, what might combofab [ph] just look with either Lara [ph] or your DACRA agonist? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks, Mike. We'll start off with Mike on the access question and then shift to Ruth for the GGG and oxyntomodulin question.

[Mike Mason, President of Lilly Diabetes]

Thanks for your question, Mike. Regarding the access, I'll go through that again. So this -- again, this is for Mounjaro for type 2 diabetes indication. We have access already for Humana's Medicare Part D formulary and Express Scripts Commercial National Preferred Formulary. So that's the access that we have currently. And obviously, we're working to expand that at the natural pace of negotiations. I think your question long term around obesity, if you just step back and you look at the impact that living with overweight or obesity has on long-term health, it's not really debatable. Most physicians, most payers understand that.

I think the struggle to date is there just hasn't been good enough agents in order to really demonstrate the health outcomes that need to happen. And so what you see. is you got companies, Novo and Lilly, who are very committed to this space who have good assets and good pipelines and we're both very committed to make sure that we can generate the data in order for people to recognize this as a chronic disease.

It's very logical. You usually don't have to have much of a debate with individuals about the importance of treating obesity. So I think it will occur, it will take some time. If I was the payer, I would probably be resistant to adding the existing treatments. So the ones that we're on before semaglutide launches because they had limited efficacy. But I think we can change that. And I think it's up to us to generate that evidence and we've got the investment, we've got the capabilities to be able to do that, and that's exactly what our plan is. So I think what you'll see over time is a steady improvement in access where employers and governments decide to add obesity. I thought it was very encouraging that the federal employees picked up obesity formulary. So I think that's an encouraging sign for what's in store for the future.

[Ruth Gimeno]

For GGG growth versus Mazdutide, which one to move forward, we have not made a decision on that yet. This will be a data-driven decision. So we are waiting for additional data, particularly the Phase II data of GGG. In terms of combinations, certainly, for Docker & Lara [ph], the natural combination partner in the near-term would be tirzepatide. I think in the long-term, it's very nice to have GGG and oxyntomodulin. And as we understand these molecules more, it gives us a lot of optionality in the portfolio and we’ll see how this evolves.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Next caller please.

[Operator]

We'll go to the line of Vamil Divan of Mizuho Securities.

[Vamil Divan, Mizuho Securities]

Hi, great. Thanks for taking the questions. Sorry if you covered this, I've been, sort of, hopping between calls here, but can you just comment on the weight reduction with tirzepatide? Just wondering if you have any data regarding lean body mass and the muscle mass loss versus a loss of fat looking for some of that data myself and couldn't find this. I'm just curious if there’s any that you can share? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Great. Thanks, Vamil. We'll turn to Jeff.

[Jeff Emmick, Vice President of Diabetes Product Development]

Yeah. We did have a slide in the deck that covered that. And what we saw in that pre-specified analysis, which combined the 10 and 15-milligram doses is that we saw a reduction of roughly 33.8% or 33.9%. I don't have the slide pulled up in front of me and lean mass at about 11% in -- or in fat mass, sorry, and about 11% in lean mass, which means we had about a three-fold greater percent reduction in fat mass and lean mass. That means you're -- and you also see a reduction in both with placebo, but overall, you're actually improving body composition with that -- with tirzepatide at 10 and 15-milligram dose compared to what they were at baseline.

So that data, again, is on slide 14. And this -- you typically see a reduction in both with weight loss whether with intensive lifestyle changes, bariatric surgery, you do expect some loss of lean mass, but we're seeing a much, much greater percentage of loss of fat mass. And again, that translates to an overall improvement in body composition, but I'd refer you to slide 14 in the deck.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Next caller please.

[Operator]

We'll go to the line of Andrew Baum of Citi.

[Andrew Baum, Citi]

Thank you. A couple of questions. We're hearing from some of your competitors that PBMs are being much more aggressive in transitioning patients from free drug bridge programs to reimbursed products. I note that you're sampling a 2.5 milligram with tirzepatide. Could you talk to how that dynamic or the commentary from your competitors we're hearing is consistent with you understanding and how it's influencing the use of a bridge program with your rollout of tirzepatide? So are you just going to sample at 2.5 and then they have to go on to reimburse, or is there going to be sampling at the high doses as well?

And then second, just following on from a previous question. We, obviously, have the midterms coming up. One of the barriers to GLP adoption is financial and the out-of-pocket contributions. We almost have caps reduced to build back better. What do you think is the appetite on the other side of the house for putting through legislation that would put in place out of pocket caps on what you think the impact that would be on GLP-1 adoption in Medicare as a consequence? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Okay. We'll shift to Mike for both of those questions.

[Mike Mason, President of Lilly Diabetes]

Okay. Yes, good questions. Let me give you my perspective. On the -- on our sampling strategy and kind of it's more of a what's the out-of-pocket experience that we want patients to have on tirzepatide. We don't want cost for to be a reason why someone doesn't get this, the benefit of this medication.

So, the sampling strategy at first, which is an important piece of that, is we think the having a sample pack with four 2.5-milligram pins is the right experience to start with. So, it's not just -- it's more of what we can do to make sure that patient has the opportunity to have a good experience and see the benefits before they have to go and make that kind of buying decision at the pharmacy of actually paying for that second strip or the first script they have at 5 milligram.

So, to us, it does many things. It allows someone to have that experience before the buying decision. It also just makes the dose titration very simple because they can give -- they can -- when they -- when a physician wants to start someone on tirzepatide, they can give a sample box and they can give a prescription with a savings card, and we will have a savings card for commercial insured patients that will buy down to $25 per patient. And so it's important for us to have a good savings program for patients as we build access over time.

The second question, I think, is if the government decided to have a co-pay cap like being discussed on insulin for other products, what would that do for coverage? It's a good question. I haven't really thought much about that because I haven't seen that in the works.

I think anything that helps cap out-of-pocket costs for people who live with chronic medications is it would be good for society would be good for America. So, I think that would be very positive. It would probably change the dynamics with payers, but I think that's something we can all work through. So, hopefully, that helps provide my perspective.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Kiwi next caller please?

[Operator]

We'll go to the line of Chris Shibutani of Goldman Sachs.

[Chris Shibutani, Goldman Sachs]

Thank you very much. Two questions, if I may and apologies for the background noise. I'm at an airport. The first is on cardiovascular outcome study, the obesity space upcoming potential interim readout from the SELECT trial for your competitors' obesity efforts. They commented at the ADA meeting in their investor event. If they designed the study looking for about a 17% MACE reduction, and further commented that there was some element of underpowering for looking at CV death viewing that the payers acknowledge the makes primary endpoint overall as the most important aspect. Can you comment about your own thoughts about your CV outcome study in obese with tirzepatide, how you design and what kind of expectations would be?

My second question is on potential duration of use of tirzepatide in obesity. Your data definitely shows a dramatic decline out to one year. The one to two-year span, however, shows less of a dramatic decrease of pace which brings to my questions about adherence. Perhaps could you comment about Trulicity adherence and discontinuations from patients during that, one, spanning to two year interval, perhaps if that was is a reasonable analogy and if it's not an obesity, if you could share reasons for that? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks, Chris. For your first question on CVOT, we'll go to Jeff. On your second question for adherence, we'll go to Mike.

[Jeff Emmick, Vice President of Diabetes Product Development]

Yeah. Thanks, Chris. Jeff Emmick. As you – your question, I think, was specifically about our outcome study in patients with obesity without diabetes. We're still working through the details of the design of the SURMOUNT MMO study. I will comment, you noticed we titled it morbidity and mortality and obesity. So we're thinking more broadly about outcomes than just the pure cardiovascular outcomes, but we're not ready to comment on the details of the endpoints in that study or the percent reduction we'd be looking at.

Similarly, we'll have a design paper once we've completed enrollment in our SURPASS-CVOT study, and we'll have some information in that around what we would look for in that patient population. But again, that study is still actively enrolling. So I can't comment on further aspects of the design right now.

[Mike Mason, President of Lilly Diabetes]

Yeah. And as it comes to obesity and the chronic use of that in adherence, there's – it will be a point of education for both health care professionals and people who have obesity to make sure they understand that this is a chronic disease. And the way incretins work it's going to be a chronic medication. So we'll do a lot of upfront training, so people understand that in the journey. There's really two parts of the journey that affects adherence.

Most of the adherence drop is actually in the first 60 days. And so we understand that experience incredibly well, and we'll make sure that we can retain the patients. We have very sophisticated approaches to make sure that that happens. And then long term, that's where the education occurs. I assume that, there's going to be some people who will see the benefit. They'll see it leveling off, they'll hit their bill rate, and they'll make the – probably the incorrect decision to stop treatment. They'll see weight increase, and then they'll go back on treatment. And so there will be obviously a pretty visible effect if someone stops taking treatment as a reminder that they need to be on treatment. So I think that will help reinforce long-term adherence to the product.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Next caller, please.

[Operator]

We'll go to the line of Kerry Holford pf Berenberg.

[Kerry Holford, Berenberg]

Hi. Two questions for me, please. Firstly, following on from prior questions on pricing and access. Interested to hear your view because actually, over time, do you expect the net price of GLP-1 and obesity fall towards that of those in diabetes? Do you see those two diseases today as distinct markets for the lines now between obesity and diabetes is fading from describing pricing and reimbursement point of view? And then secondly, on the pipeline, one of your partners, Rigel Therapeutics, published in Phase I data, for its oral GLP-1 ADA this year. I think that actually is now started Phase II. And I'd just be interested to understand whether that's an asset that falls under your collaboration agreement?

[Lauren Zierke, Senior Director of Investor Relations]

Thanks, Kerry. We'll go to Mike to your first question on price, and Ruth, for your second question on partnership.

[Mike Mason, President of Lilly Diabetes]

Yes. I mean any pricing discussion is just pure speculation. Obviously, no one knows where the evolution of pricing is going to be in the obesity and diabetes markets. What you suggest is that obesity prices may go down to near diabetes.

That's probably one scenario that could happen. I believe if that were to happen, that means that access will be broad and encumbered, and so that wouldn’t be a negative outcome for the overall obesity market.

[Ruth Gimeno]

Yes. And with respect to the Rigel assets, just Lilly has no role in Rigel's work on RGT-075, so this does not fall into our collaboration.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for your questions. Next caller, please.

[Operator]

We'll go to the line of Robyn Karnauskas of Truist Securities.

[Nishant Gandhi, Truist Securities]

This is Nishant Gandhi on line for Robyn. Just a quick one on long-term safety for GLP-1 class in general. Just curious if you have any data to compare side effects in, for example, real world for Trulicity versus clinical trials or other GLPs in general. How frequent do you see the side effects? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

And maybe just if we could clarify your question. So you were asking about real-world evidence of Trulicity versus GLP-1s and get like tirzepatide? Is that correct?

[Nishant Gandhi, Truist Securities]

Yes, in general, like the side effects compared to the clinical trials with Trulicity.

[Jeff Emmick, Vice President of Diabetes Product Development]

Well -- so this is Jeff Emmick, let me try to comment and I'm still not quite sure I follow the question. But certainly, we do have long-term data real world with GLP specifically, in our case, Trulicity comparing to the clinical trials. And what we see with long-term real-world use is a safety profile that is very comparable to what we observed in our clinical trials.

I can't comment. Obviously, we don't have long-term data beyond clinical trials on tirzepatide or dual agonist. So can't make any cross comparisons there. I think what we have said very consistently is that tirzepatide's safety and tolerability profile is very, very consistent with what we've seen for the GLP-1 receptor agonist.

That's both in patients with diabetes. And now we have a very large and fairly long study in patients without diabetes and SURMOUNT-1, and it, again, looked very similar. But I can't comment on specific comparisons to real-world evidence there.

[Mike Mason, President of Lilly Diabetes]

Yes, maybe this will help. We look very closely at kind of the retention rate of patients who pick up a prescription of their diabetes medication and then how many are still on treatment at six months' time frame. We look at different time frames, one is six months.

When I look at the Trulicity data historically, that, that retention rate has been the best across any class, whether that be generic or branded. And so, I think that would suggest that the GI side effects isn't causing a higher-than-expected issue with people staying on treatment.

So I think the -- because of the overall experience that we've seen on Trulicity, it just -- that's why the product is positioned so strongly in the marketplace, and has performed so well in the face of competition is that, people like the experience and they like the experience, they stay on it.

So part of the experience is the GI side effects. The other part of it is the efficacy. If you're not seeing efficacy, you're experiencing GI side effects, you're not going to stay on the product. So it's never just one part. It's always just a calculation of what the out-of-pocket cost is, what the efficacy is and what the tolerability is if someone is experiencing, but it's just been very strong for Trulicity historically.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Next caller please.

[Operator]

And we have a follow-up from the line of David Risinger of SVB Securities.

[David Risinger, SVB Securities]

Yeah. Thank you very much. So I just wanted to ask a little bit about access and the expected ramp. So for context, could you just remind us where the current Trulicity access stands? And how we should think about the tirzepatide ramp to get towards that target in coming months and years? And with respect to prescriptions, should we assume that the samples won't be captured by the various prescription tracking sources such as IQVIA? Thank you.

[Mike Mason, President of Lilly Diabetes]

Yeah, good questions. So Trulicity has greater than 90% access. So we've built that out over the years. With tirzepatide, you don't want to expedite or accelerate the negotiations at a rate that would actually cause you to pay higher rebates than what you ultimately need to. And so the payer negotiations has to go at the right speed at the right pace in order to get the right access at the right price point. And so we've done this with many launches, and we're at the pace that we would expect in order to build the access we need to be successful long-term.

Again, we're going to be -- we've been in diabetes for 99 years. We plan to be in obesity for decades. So we're always taking a long-term approach versus trying to demonstrate results in the first month or two or three. As it comes to the sample pack, yeah, you're right. If a patient or someone living with diabetes gets a sample pack that has the product in it, and thus, that will show up as a prescription will only show up in prescription as they go to the pharmacy to pick up the five-milligram dose.

Now that said, there is -- not every physician uses the samples. And so in that case, the physician that doesn't use samples would use a 2.5 milligram script, and then that would count in IQVIA data.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks for the question. Next caller please.

[Operator]

We'll go to the line of Evan Seigerman of BMO Capital Markets.

[Evan Seigerman, BMO Capital Markets]

Thank you for taking the question. So we know the data from SURMOUNT-1 is impressive. It was a long two-hour session over the weekend. Do you see a path forward for obesity ahead of the additional SURMOUNT trials? Specifically, I'm asking if you can use any of the data or subsets of data from the SURPASS trials to maybe help support approval in the obesity indication ahead of the data next year?

And then my follow-up question, kind of, piggybacking off of an earlier question. Over time, do you expect as patients achieve their 20% weight loss or so to be able to use lower doses, so say, dose reduced from 15 milligrams to 10 to five to maintain that efficacy. Is that something you're thinking about or physicians are thinking about as you look forward to kind of long-term use of tirzepatide in obesity? Thank you.

[Lauren Zierke, Senior Director of Investor Relations]

Thanks, Evan. We'll go to Mike for your first question on regulatory, and then Jeff for your second question on dosing.

[Mike Mason, President of Lilly Diabetes]

I'll take the first one. Thanks, Evan. As I mentioned during our remarks, we plan to engage with regulatory authorities, given the robust results of SURMOUNT-1 to engage regarding the possibility of a submission utilizing SURMOUNT-1 plus the data from SURPASS, as you've noted. So certainly, weight was not a primary endpoint in SURPASS program, but it was a gated secondary in our program. And what I can share is that more than 80% of the participants in the SURPASS program met criteria for either BMI greater than 27 with a comorbidity or a BMI greater than 30. So -- and that's something we heard throughout the complex, the majority of patients with type 2 diabetes also have overweight or obesity. So we have a large data set. And the other very encouraging finding was the very similar safety and tolerability profile between SURMOUNT-1 in that patient population, what we've observed in SURPASS. And again, we'll have an update in the second half of the year.

[Lauren Zierke, Senior Director of Investor Relations]

Great. Thanks, and we'll shift to Mike for closing comments.

[Mike Mason, President of Lilly Diabetes]

Okay. All right. Well, in closing, we are thrilled with the potential we see for future innovation across diabetes and obesity and believe the approval of Mounjaro in type 2 diabetes is a great start as we work to expand into obesity and related metabolic conditions. We remain focused on addressing these unmet need for patients to deliver breakthrough outcomes. We appreciate your participation in today's investor call and your interest in Eli Lilly and Company. Please follow up with our Investor Relations team if you have any questions, we have not addressed on the call, and enjoy the rest of the day. Thank you.

[Operator]

Thank you. And ladies and gentlemen, this conference is available for replay beginning at 2 p.m. Eastern Time today running through June 27, 2023 at midnight. You may access the AT&T replay system at any time by dialing 1 866-207-1041 and entering the access code of 785-0259. International dialers may call 402-970-0847. Those numbers again are 1 866-207-1041 or 402-970-0847 with the access code of 785-0259. That does conclude our conference for today. Thank you for your participation, and you may now disconnect.