Drugmaker Eli Lilly said Thursday that it is on track to seek federal approval for its next-generation obesity drug early next year.

Shares rose 2% on the news, to $1187. Lilly became the first drug company to reach a trillion dollar valuation last fall as sales of its weight loss drugs took off. It is beating the broader market this year, with shares up around 10% in 2026 versus the S&P 500's 8% gain.

The announcement came with the release of Lilly's final wave of late-stage trials for the drug retatrutide. Among adults with general obesity, the weekly injectable lowered the weight of late-stage trial participants by an average of 28% over 80 weeks at the highest doses tested.

That's significantly higher than Lilly's current offerings, Foundayo and Zepbound, which lowered body weight by 11.9% and 20.9%, respectively, over 72 weeks in trials.

Thursday's trial results, which focused on people with obesity combined with either Type 2 diabetes or established heart disease, showed weight loss of 20.8% and 22.6%, respectively.

"We now have the clinical data package to support global submissions for retatrutide as a potential treatment for obesity, knee osteoarthritis pain, and obstructive sleep apnea," Lilly's executive vice president Kenneth Custer said.

Retratrutide works by activating three hormone receptors at the same time -- a mechanism known as "triple agonism" -- to accelerate weight loss. The result, according to the company, is lower appetite, improved insulin response, and higher metabolism. By comparison, Lilly's current offerings target either one or two receptors.

By activating the receptor for glucagon, a hormone produced by the pancreas, retatrutide is aimed at increasing metabolism, which in turn burns more fat than current weight loss drugs.

Final FDA approval, if granted, could take another year, meaning the drug might not be available until 2028.

Write to Anita Hamilton at anita.hamilton@barrons.com

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July 23, 2026 12:24 ET (16:24 GMT)

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