Eli Lilly and Company (LLY) could see higher sales for its Zepbound weight loss drug for Q1 after missing expectations for the drug in the previous two quarters, UBS said in a Monday note.

UBS analysts said that 70% of new-to-brand prescriptions are now Zepbound and Wegovy, which "should give investors encouragement [that] demand is not stagnating."

Based on their analysis of total prescription data, the analysts said that they expect Zepbound to be 2% higher than the consensus and type 2 diabetes drug Mounjaro to be lower by 2%. Their estimate for Q1 Zepbound sales is $2.3 billion, broadly in line with the consensus of $2.25 billion.

The analysts said they are also broadly in line with the company's sales forecast, with the higher Zepbound sales performance being offset by lower sales from Mounjaro and breast cancer treatment Verzenio.

They noted that "most investors" in their discussions would want to own Ely Lilly stock if the company's study of Orforglipron for treating type 2 diabetes is positive, for the potential of the first oral glucagon-like peptide-1 in obesity.

UBS reiterated the company's stock rating at buy and the price target at $1,100.

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