Eli Lilly expands AI drug discovery investment to diversify beyond weight-loss franchise

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Lilly expands AI drug discovery

Highlights

Eli Lilly has built an AI-driven drug discovery network involving about 100 smaller biotechs sharing anonymised data and signed 20 AI licensing deals, the highest in pharma as of May.
Lilly's profits more than doubled in Q1 with EPS reaching $8.26 and cash and highly liquid assets rising 121 per cent to $7.3bn by end-2025.
Lilly's obesity and diabetes medications captured 1.6mn U.S. prescriptions versus Novo Nordisk's 1.1mn as of early June, positioned to benefit from Medicare pilot programme starting July.

AI platform and dealmaking strategy

As reported by Financial Times, Eli Lilly is building an AI-led drug discovery network that lets roughly 100 smaller biotechs use its models in exchange for anonymised data, an approach chief executive Dave Ricks described as being "like the App Store" for scientists. He says AI-driven drug development remains early-stage, but argues the company still needs to invest now in technologies that could shape future pharmaceutical research.

Lilly last year launched its own data centre with 1,016 Blackwell chips from Nvidia as part of that effort. The company also says it has signed about 20 deals to license AI technology from third parties, more than any other pharmaceutical company as of May, according to UBS, and in March announced a $2bn agreement with Insilico Medicine for exclusive rights to sell a GLP-1 drug if it is successfully developed and approved.

Ricks says access to the AI hub is selective, and that some groups, including "a Russian-based AI lab", would not be admitted. Lilly is also working with Nvidia in a San Francisco lab where its scientists collaborate with the chipmaker's engineers to search for new treatments.

Cash reserves support pipeline and market expansion

Lilly's investment push is backed by strong earnings from products including Mounjaro and Foundayo. Its profits more than doubled in the first quarter, with earnings per share rising to $8.26, and by the end of 2025 the company had built cash and other highly liquid assets of $7.3bn, up 121 per cent from a year earlier.

Ricks says data centre spending forms part of a rising research and development budget that is expected to be in the high teens of billions of dollars this year, compared with $13bn in 2025. Alongside AI spending, Lilly has announced 11 acquisitions so far this year, more than in 2025 and 2024 combined, according to S&P data, including a May move to buy three vaccine companies developing treatments for infections such as shingles.

The company continues to outperform Novo Nordisk in the weight-loss market. As of the first week of June, Lilly's obesity and diabetes weight-loss medicines account for 1.6mn U.S. prescriptions, versus 1.1mn for Novo's drugs in the U.S., according to Iqvia data. Sales could also benefit in July when the U.S. government starts a pilot programme offering these medicines through Medicare until the end of 2027, a shift Ricks says is an opportunity rather than a pricing risk.

In our earlier article on Corning’s Optical Communications surge tied to AI infrastructure deals, we noted that GLW was rallying as demand rose from large-scale buildouts requiring next-generation data connectivity. The piece highlighted how partnerships with major tech companies helped expand Corning’s pipeline, supporting both strong segment results and bullish investor sentiment.

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