Eli Lilly (LLY) benefits from "lots of untapped volume to capture" in the obesity drug market ever after Zepbound's exclusion from CVS Health's (CVS) preferred list, Deutsche Bank said Friday in a note.

"Commercialization of the chronic obesity opportunity is still in early innings" after Lilly's Zepbound launched in December 2023 and Novo Nordisk's (NVO) Wegovy debuted in June 2021, the report said.

Customers are likely opting for Zepbound after trials demonstrating a 20% weight loss advantage versus Wegovy at 14% after 72 weeks, Deutsche Bank said.

Zepbound's cash-pay vial at $349 to $499 a month is "virtually on par with Wegovy's new to brand scripts," the report said.

Deutsche Bank reiterated its buy rating on Lilly stock with a 12-month target price of $1,010.

Lilly shares rose 2.9% in recent Friday trading, and Novo Nordisk jumped 5.3%.

Price: 816.97, Change: +22.87, Percent Change: +2.88