In 1977, Ken Langone received Eli Lilly shares for a medical device company he had acquired for $1.5 million. He has never sold a single share.
I covered his story on Sept. 25 — the two crises he bought through, the golf game where his trader kept buying while he played, the conviction that now stretches nearly five decades.
What makes Langone’s thesis compelling in 2026 is how it chooses to use the windfall it has earned.
CEO Dave Ricks told Bloomberg on the sidelines of the European Association for the Study of Diabetes conference in Milan that investors should expect Lilly to strike slightly larger deals as it hunts for assets in what he called the “white spaces” of science — areas where unmet medical need is high, and competition is limited.
Lilly is on track to reach $85 billion to $87 billion in sales this year, nearly double what it was two years ago, according to Lilly’s second-quarter 2026 results.
The question Ricks is answering is: what does a company do with that kind of cash when it has a decade of patent protection left on its primary products?
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The “white spaces” strategy and what it means for patients
Some diseases do not get enough research funding because the commercial opportunity is uncertain, the science is difficult, or the patient population is not wealthy enough to support premium pricing.
Infectious disease. Women’s health conditions that have been historically underfunded. Psychiatric illnesses where treatment remains inadequate for millions.
These are the areas Ricks specifically named in Milan. And he is not talking about them abstractly because Lilly announced it acquired three vaccine makers for as much as $3.8 billion in 2026 and agreed to purchase Psychedelics research firm AtaiBeckley for a similar sum, representing bets on infectious disease and psychiatric treatment, respectively.
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“Going a little bit bigger” in deals — along the lines of the $7.8 billion Centessa Pharmaceuticals acquisition — is what investors should expect to see more of, Ricks said.
The company has completed roughly 40 deals worth more than $20 billion in 2026, the highest annual deal value in its history, according to Bloomberg data.
For the millions of patients living with conditions that pharma has historically underserved, Lilly is entering those spaces with the financial muscle of the world’s largest pharmaceutical company, which represents something meaningful.
The drug development pipeline for psychiatric conditions like treatment-resistant depression and bipolar disorder has been historically thin. Women’s health has been systematically underfunded for generations. Infectious disease requires investment that often fails to yield returns commensurate with the scale of human suffering involved.
Ricks is making a calculated bet that these spaces can be scientifically cracked and commercially viable. And that Lilly is better positioned than anyone to make that bet from a position of financial strength.
The deal strategy is to buy early, before the bidding wars
Rick’s acquisition philosophy reveals something important about his approach. He does not want to compete for assets once their value is obvious to everyone.
“What we like to do is look at data that’s not yet mature and make a bet on it way before these companies are worth $5 billion,” Ricks told Bloomberg. “They’re worth $500 million. And if we make enough smart bets, it tends to pay off.”
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That contrarian, early-stage conviction echoes what Langone described from his half-century of holding Lilly stock — the willingness to act on incomplete information when you trust the underlying institution.
Ricks acknowledged that recent deals have shown a greater willingness to pursue later-stage assets, but the core preference remains entering before competitive bidding pushes prices higher.
The alternative — returning capital through buybacks and dividends — is explicitly less interesting to Ricks than productive reinvestment. “It’s much more interesting to reinvest in human health,” he said.
The business case that funds all of it
None of this strategy exists without the Mounjaro and Zepbound machine funding it. Q2 2026 total revenue was $23 billion, up 48% year over year, according to Lilly’s Q2 earnings release. Full-year 2025 revenues were $65.2 billion, up 45%. One-third of new oral GLP-1 patients are now choosing Foundayo, as I reported Sept. 22.
20 of 22 analysts covering LLY over the past three months recommend buying, according to TheStreet. One hold. One sell. The consensus reflects confidence in both the obesity franchise and the diversification Ricks is executing.
On performance, LLY trades near $1,184 with a market capitalization of $1.03 trillion, up 10.78% year-to-date and 64.55% over the past year, according to Yahoo Finance.
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