Eli Lilly's share price dropped 14% to $640 apiece in early trade on Thursday.
The stock had slipped 12% to $656.21 in pre-market trade as data on its new weight-loss drug came as a disappointment, even as the company's current obesity medicine showed strong growth.
The data showed the pharmaceutical company's experimental pill helped patients lose roughly up to 11% of their body weight, which measures up to 25 pounds, falling short of the lower end of Wall Street's expectations, as per a Bloomberg report. The development came as a relief for its rival Novo Nordisk, which rose as much as 12.5%.
Shares of Eli Lilly closed 2.56% lower at $746.37 on the previous trading day.
Investors had expected Lilly's pill 'orforglipron' to be as effective as Wegovy, a weight-loss injectable manufactured by Novo Nordisk. Wegovy users lost about 14% to 15% of their weight in pivotal trials, slightly lower when compared to Lilly's rival injection Zepbound, as per the report.
The most common side effects of the pill were reported to be nausea, vomiting and diarrhea, occurring at rates similar to existing GLP-1 drugs, said the report.
The drug, however, didn't cause any liver issues which is one of the major concerns related to other weight-loss pills being developed. Owing to the side effects, about 10% of patients dropped out of the study, it mentioned.
The company's findings from the 18-month study involving more than 3,100 adults will likely be submitted to regulatory authorities for approval by the end of the year, added the report.
If approved, the one-daily pill would likely be available in the market next year, it said.
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