Opinion
Ricks: PBM rebate incentives should be eliminated as unethical
“These PBMs and there's some group purchasing organizations like this. That should go away. And I think health is different than other commodities. It's probably has a much more important social role in deciding that the smallest, the little guy gets the worst …”
Assertion Partly supported
Ricks: Insurers initially refused to cover Eli Lilly's discounted generic insulin
“In the first year, no formularies covered this. So it was really only for that cash payer. No insurance company picked it up, even though it was dramatically cheaper. Now it's about half of the volume, but still half not because that model of this margin sprea…”
Prediction Partly held up
Ricks: Machine-designed drugs haven't reached clinical trials yet, but are coming
“I don't know of one that's come through the machine driven discovery process, which is really machine plus human that's made it to the clinic yet, but they're coming.”
Insight
Ricks: AI won't solve biology until we understand over 50% of it
“And today, I don't know, I would estimate we might know 10 to 15% of human biology. So the machine's not going to be good at all until we get way above 50%.”
Opinion
Ricks: Claude and xAI beat ChatGPT for science because references check out
“I don't use that one for science actually. It's too, too horrible.
Patrick Collison: So which one do you use for science?
Dave Ricks: I tend to use either Claude or the XAI one. I find it more terse. And more, the references actually check out more often.”
Opinion
Ricks: Lilly's industry-leading R&D ROI comes from process, not picking winners
“I think one of the reasons Lilly has probably the highest return on investment in R&D in the industry is because not the picking of winners and losers, but the, actually the process by which we run it.”
Assertion Partly supported
Ricks: Cardiovascular trial rules added five years to diabetes drug development
“The Evandia one, we know well, we work in diabetes, actually caused a policy change, and the policy change was you must rule out cardiovascular risk prior to market entry, and as you may know some conditions like diabetes have a more continuous variable you're…”
Insight
Ricks: Expensive cardiovascular trial mandates protect GLP-1 incumbents from low-cost competition
“Now, by happy accident, we are all now really pleased with, like, incretins, like our trisepetide to run them because they frequently demonstrate massive benefit. Uncardiovascular. And in some ways, it creates a barrier to entry for the next low-cost Chinese p…”
Assertion Supported
Ricks: ICER found tirzepatide and semaglutide cost-effective at current pricing
“They just analyzed our medicines, trisepatide and semaglutide, and they said, actually, they're both cost effective at current pricing. In fact, Zepbound or Trisepatide was, the threshold they have is to save a 100,000 dollars per person per year in downstream…”
Disclosure
Ricks: Lilly is considering SaaS-style recurring pricing for common gene therapies
“It's conceivable that one could create like a licensing concept, stealing from the SAS model, where you say, we'll do the procedure for free. And as long as it's working for you will deposit X amount in our bank account, and you're getting the value, and we're…”
Assertion Supported
Ricks: Medicine accounts for only 10 cents of every US healthcare dollar
“In the US, the most expensive healthcare system in the world, we spend 10 cents on the dollar on medicine. The other 90 cents go through everything else that medicine's trying to prevent.”
Assertion Partly supported
Ricks: Lilly's net insulin price stayed near $30 despite $275 list price
“Our actual net on insulin really hasn't changed. It's like 30 or 40 dollars, but the list price got up to two 75.”
Assertion Not checkable as stated
Ricks: Early-stage biotechs pitch 80% to 100% of revenue from the US
“If you fund, if you went out and said, hey, I want to back some biotechs, and they sent you their business plan, 80 to a hundred percent of the revenue in return they'll pitch you on is the US. Meaning there is no return outside the US if you start at the poin…”
Prediction Held up
Ricks: Eli Lilly's chronic knee pain study is going to work
“We have a study reading out toward the end of this year in chronic knee pain. It's going to work.”
Prediction Partly held up
Ricks: Taltz plus Zepbound trial is certain to boost psoriasis efficacy
“So we're doing a study with our psoriasis drug, Taltz, and ZepBound. That will read out this fall. And I'm certain we'll show a boost in efficacy with the weight loss.”
Insight
Ricks: Pharma must invest 20-25% of revenue in R&D for double-digit growth
“I have a belief that if you're not generating, to generate double digit growth in the sector, you need to invest at 20 to 25% of sales in R&D. That's sort of a good, a positive return R&D stack.”
Disclosure
Ricks: Eli Lilly is building pharma's largest biological supercomputer
“Building a supercomputer on our, on-prem for us, really just to run proprietary drug discovery models. We think it's the biggest biologically focused supercomputer there is. And certainly the biggest pharma's done. Yes. With B 300 latest chipset.”
Assertion Not checkable as stated
Ricks: Developing a drug costs $4B, with over 60% spent in Phase 3
“The final stage of testing, the average drug costs three and a half, four billion to make more than 60% of that is the last step.”
Assertion Partly supported
Ricks: US cancer trial enrollment is 4% versus over 25% in Spain
“Only four percent of patients who have cancer in the US are in clinical trials, whereas in Spain and Australia, it's over 25%.”
Assertion Supported
Ricks: Lilly develops clinical drugs in under 7 years versus industry average
“Drug development time in the industry, It's about 10 years in the clinic, a little less right now. We're running a little less than seven at Lilly”
Prediction Held up
Ricks: Current GLP-1 drug pricing will fall amid competition and pressure
“And the current pricing isn't going to stay. Let's be honest. There'll be more competition. The government wants to lower our prices.”
Assertion Partly supported
Ricks: Non-Lilly large pharma multiples are at a 20-year low
“If you look at the large cap farmers, not Lilly, but the other ones, the multiples, the most compressed it's been in 20 years. If you look at biotech, the XBI, I think half of the XBI is trading below cash. And then if you look at. Venture. Half of the rounds …”
Assertion Contradicted
Ricks: Drugs lose 97% of their pricing when patents expire
“Typically a generic event, you'll lose 97% of your pricing the day your patent expires.”
Assertion Supported
Ricks: Most major hospital systems have failed price transparency compliance
“Compliance is terrible. Most major hospital systems have not complied. Or if they have, they put on a website somewhere a coded database that is impossible to interpret with ICD-X codes and price points that consumers cannot digest.”
Dave Ricks