Lilly appoints insider as finance chief amid rising investments to boost capacity

By Bhanvi Satija

(Reuters) - U.S. drugmaker Eli Lilly on Monday said it has appointed insider Lucas Montarce as its new chief financial officer, effective immediately, months after former CFO Anat Ashkenazi stepped down to join Google parent Alphabet.

This executive change arrives at a critical juncture for Eli Lilly, as the company invests billions to expand manufacturing capacity and meet soaring demand for its diabetes and weight loss drugs, Mounjaro and Zepbound.

Lilly and Danish rival Novo Nordisk are leaders in the burgeoning market for new weight loss drugs, which some analysts project could exceed $150 billion by the early 2030s.

Shares of the company were flat in afternoon trading. The Indianapolis-based drugmaker is already the world's most valuable healthcare company, primarily due to the high demand for its weight-loss treatments.

Under Ashkenazi's leadership, Lilly's stock grew nearly four-fold. "I do think that a lot of people were pretty surprised by the departure of the previous CFO," said Dave Wagner, Portfolio Manager at Aptus Capital Advisors, which holds about 30,000 shares of Lilly, according to a regulatory filing.

Montarce, at Lilly since 2001, has held finance leadership roles, including for Research Laboratories and International divisions.

"Lucas was very much groomed probably to be the next CFO," Wagner said, pointing to Montarce's experience being similar to Ashkenazi's within the company.

Ashkenazi had also served as the finance chief for Lilly Research Laboratories before being appointed as the drugmaker's CFO in February 2021. Wagner said that while it was difficult to compare the two executives, Montarce has "big shoes" to fill.

In his new role, Montarce will serve as both CFO and executive vice president, with a base salary of $1 million and eligibility for an annual target bonus of $1 million.

(Reporting by Bhanvi Satija in Bengaluru; Editing by Tasim Zahid)