Eli Lilly's CEO went on CNBC to announce that one-third of new GLP-1 pill patients are taking Foundayo. Which means two-thirds are not. He said this like it was good news.
The company is ramping up production of a pill where 66% of new customers looked at their options and picked someone else. That's the headline they wanted. That's the victory lap.
Novo Nordisk got a head start in the GLP-1 pill space, which is corporate speak for they showed up first and people bought their sh*t instead. Lilly is now trying to catch up by making more pills that most people are already not choosing. The strategy appears to be flood the market and hope math stops working.
Imagine walking into a board meeting and saying your new product captured 33% of customers who had literally just started looking at this category. Imagine everyone nodding. Imagine calling CNBC about it.
Retail traders heard one-third and bought calls. They heard ramping up production and bought more calls. They did not hear the words trying to catch up, which means currently behind, which means losing. They never hear those words. They are constitutionally incapable of processing sentences that contain both a company name and a verb suggesting that company is not winning.
Lilly's stock will move based on this news. It will move because someone will decide one-third sounds better than zero-thirds, which is true. It will move because production ramps sound like momentum, which they are not. It will move because GLP-1 is a magic word that makes portfolios do things.
The CEO told CNBC these numbers because CNBC has cameras and asks questions someone will watch. Two-thirds of viewers probably changed the channel.
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