Eli Lilly reportedly is pulling "millions in advertising" from Twitter after a fake account promised free insulin in a fiasco that helped depress LLY stock.
According to the Washington Post, Lilly is pulling its advertising from Twitter after a fake, but "verified," account claiming to be the Big Pharma stalwart said insulin would be free. The message spread widely for hours while Lilly executives scrambled to reach Twitter. Mass layoffs at Twitter didn't help.
Lilly on its actual Twitter account apologized for the "misleading message." But LLY stock tumbled 4.5% in the aftermath. Shares of fellow insulin-makers Novo Nordisk and Sanofi also toppled. It's important to note the move occurred on a day that saw many big-name health-care stocks take a dive.
Representatives of Lilly didn't return requests for comment from Investor's Business Daily.
LLY Stock: Pay-For-Play Twitter Debacle Continues
The fake Lilly account is no longer active on Twitter. It was verified under Elon Musk's new rules that allow any account to receive a blue check mark for $8 a month. Numerous fake accounts have cropped up in the aftermath, impersonating big brands and public figures. Twitter has since disabled the feature.
One account impersonated Nintendo and posted a doctored picture of Mario flipping his middle finger. Another account claimed to be the developer of "Grand Theft Auto" and posted a fake update about the company's next video game. Others have impersonated politicians, celebrities and historical figures. Many also have created fake accounts impersonating Twitter's divisive new owner, Elon Musk.
But the insulin claim comes at a boiling point for companies in the space and a critical time for LLY stock. Lilly, Novo and Sanofi supply all of the insulin in the U.S. where no generics exist. Insulin is a lifesaving medicine for some patients with diabetes. The medicine can be pricey, however. In the first nine months of 2022, Lilly's insulin products have generated more than $2.8 billion in sales, though that's down year over year.
LLY stock climbed slightly on Monday, but not enough to make up for Friday's downfall. On today's stock market, shares rose 1.4% to 356.06. The advance followed Roche's failure in two Phase 3 studies of its Alzheimer's drug. Lilly also is testing a late-stage Alzheimer's treatment.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
