Eli Lilly stock drops after buyback announcement
Investors were less than enthusiastic Thursday to news from Eli Lilly executives about its drug pipeline and earnings projections.
Lilly leaders promised to cut costs if necessary to make 2014 earnings numbers and unveiled a $5 billion stock buyback.
Lilly says there are a record 13 new potential medicines in later stage trials and regulatory phases. However, the most recent rulings have not been in Lilly's favor and it's an expensive game.
"It is at least a billion dollars that is at risk for one product but that we should remember covers a lot of the failures as well," said Jan M. Lundberg, executive vice president of Science & Technology of Lilly Research Laboratories. "So if we could improve our success rate by applying the much better science and technology that is constantly evolving in the society, then we should be able to do it quicker and cheaper and actually then in a more consistent way."
But investors on Wall Street responded with a 3.4 percent drop in Lilly's stock price, closing down $1.74 at $48.80.