GLP-1 treatments such as semaglutide (under the brand names Ozempic and Wegovy) by Novo Nordisk A/S (NYSE:NVO) were likely the hottest medical sector story in 2024. With its offering of tirzepatide (branded as Mounjaro and Zepbound), Eli Lilly and Co. (NYSE:LLY) was another key pharma player in this new type of treatment for diabetes and obesity. Revenue gains followed the popularity of these treatments. Eli Lilly saw Mounjaro sales climb by about 114% year-over-year in the third quarter of 2024, beating Novo Nordisk in large part thanks to the availability of supply.

Nonetheless, shares of Eli Lilly have been erratic in recent months. Though the stock is up 25.1% in the year leading to January 24, 2025, in the back half of that time period—the six months from late July 2024 through January—LLY has dropped by more than 4%. This is all despite a record-high share price of close to $973 achieved in 2024 on the momentum of tirzepatide sales.

Much of Eli Lilly's momentum in recent quarters has been due to Mounjaro and Zepbound. However, in January 2025, the company updated its 2024 revenue guidance and offered guidance for the new year, which many investors found disappointing. Sales are still booming—chairman and CEO David A. Ricks said that the U.S. incretin market (encompassing GLP-1 drugs) grew by 45% year-over-year through the final quarter of 2024. However, the company does not anticipate that sales of its two GLP-1 treatments will grow as quickly as initially anticipated.

Investors might keep in mind that Eli Lilly still projects substantial top-line growth for 2024 and especially for 2025. The company expects $45 billion in revenue for 2024 and somewhere in the range of $58 billion to $61 billion for 2025. Helping to drive this growth is Eli Lilly's concerted effort to bolster GLP-1 production. The company expects to produce at least 60% more salable doses of incretins in the first half of 2025 than in the same period in 2024.

There's even more reason to be excited about the potential for Zepbound in particular in 2025 and beyond—late in 2024, the FDA approved that drug for the treatment of moderate to severe obstructive sleep apnea (OSA) in adults with obesity. Zepbound is the first FDA-approved medicine to treat OSA, opening up a new portion of the market and giving Zepbound a potential edge over other GLP-1s currently available.

Orforglipron is Eli Lilly's pill version of tirzepatide, and the company expects data on the experimental drug by the middle of this year and potential approval as early as the first few months of 2026. Considering that GLP-1 drugs currently require a regular injection, it's likely many patients will opt for a straightforward pill option instead if given the choice. Besides that, Eli Lilly has another GLP-1 candidate in the works that seems to be the most powerful yet. Retatrutide has been shown to produce the greatest weight loss of any GLP-1.

With the popularity of GLP-1 drugs, it's easy to forget that Eli Lilly has a deep roster of many other strong candidates as well. In particular, analysts favor the company's oncology slate, including Verzenio, an oral medication used to treat certain types of breast cancer. Sales from this drug alone reached almost $4 billion for the third quarter of 2024, an improvement of 38% year-over-year. On top of that, Eli Lilly has a number of exciting oncology drugs in the works, including STX-478 from Scorpion Therapeutics, for which the company recently paid $2.5 billion.