In the midst of a pandemic, the drug industry islikely at least in the short term to see a boost to its bottomlines. (Photo: Shutterstock)

Just as other products have seen sales and profits go throughthe roof as people stocked up on goods in response to lockdowns,pharmaceutical company Eli Lilly has not only beat quarterlyestimates but also boosted its profit forecast for 2020 ascustomers have stocked up on such drugs as its diabetes drugTrulicity and psoriasis drug Taltz.

According to a Reuters report, the company did warn that thephenomenon would likely reverse over the course of the year and itcould still be hit with a negative impact to drug prices given thetoll coronavirus is taking on the economy.

Related: UnitedHealth quarterly earnings a positive sign forhealth insurers

According to Citi Equities analyst Andrew Baum, the outlookcould be impacted by long-term unemployment rates, which couldreduce the demand for drugs. There's also the possibility that thefederal reimbursement for some drugs could be cut.

But despite the warning, other groups fear that the pharmaceuticalindustry is cashing in on the crisis to boost profits, such as therequest from Gilead Pharmaceuticals to have its experimentalcoronavirus treatment classified as an "orphan" drug. The companylater withdrew its request.

But in the midst of a pandemic, the drug industry is likely atleast in the short term to see a boost to its bottom lines, as alsoappears to be the case for health insurers. Long term, of course,the outcome is far from clear, since as Reuters reports thedisruption caused by the pandemic is taking a toll on other aspectsof the pharmaceutical business—such as many of Lilly's clinicaltrials, a move that, according to the report, "could hurt futurerevenue and limit patient access to experimental treatments."

Still, such negative effects aren't expected to last long, withJ.P. Morgan analyst Chris Schott saying in the report, "While wecould see some negative impact to drug pricing from COVID-19, wesee this as fairly manageable and far more muted than the impactsbeing experienced elsewhere in the broader economy."

In fact, a Barron's report highlights the potential, pandemic or nopandemic, for a profitable future for the drug industry, "given itsfocus on new products, a promising sales outlook, and lowprice/earnings ratios" as well as essential "treatments for cancerand other life-threatening diseases."

Read more: 

• Could coronavirus outbreak disrupt employee accessto critical drugs?
• Consumers' drug choices decreasing, pricesincreasing
• Eli Lilly CEO: What's really wrong with the healthcare system