
Jim Cramer: Eli Lilly (LLY) Changes to Phase 3 Trial Endpoint is 'Disappointing' News
NEW YORK (TheStreet) -- Eli Lilly & Co. (LLY) - Get Report stock is down by 3.71% to $71.17 on heavy trading volume on Tuesday, after the company announced a change to a Phase 3 trial's primary endpoint.
The Indianapolis-based drug manufacturing company announced the change to a drug trial that treats mild Alzheimer's dementia. The study's primary endpoint is now solely "cognition" and includes "functional outcomes" as a key secondary endpoint for the trial.
Regulators consider both cognitive and functional endpoints as necessary for clinical trials for people with mild Alzheimer's dementia, the company said in a statement. Regulatory guidance typically includes the two endpoints as co-primary endpoints, according to Eli Lilly.
Eli Lilly's "disappointing news" today shows that the company realized that the drug will not be able to improve patients' functional capabilities, TheStreet's Jim Cramer wrote in anAction Alerts PLUS article today. Cramer's charitable trust is selling all of its shares of the company.
"Importantly, the release acknowledged that regulators continue to emphasize that both cognitive and functional improvements must be achieved for approval," Cramer and Research Director Jack Mohr wrote in the article. "While results from LLY's Phase 3 trial are set to be released in the fourth quarter of this year, we view the announcement as an implicit acknowledgement that it will likely not succeed."
So far today, 8.97 million shares of Eli Lilly have traded, versus the company's 30-day average of 4.79 million shares.
Separately, recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rates this stock as a "hold" with a ratings score of C+. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.
You can view the full analysis from the report here: LLY










