By Manojna Maddipatla and Mrinalika Roy

(Reuters) -Eli Lilly on Tuesday raised its 2021 profit forecast, citing the strength in its core business and higher sales of its COVID-19 antibody therapies, and said it started the application process for the approval of its closely-watched Alzheimer’s drug candidate.

The drugmaker, best known for its anti-depressant Prozac, is betting on new drug approvals to drive growth and offset competition for key drugs like insulin products Basaglar and Humalog and pricing pressures in the United States for other key drugs.

Lilly said it had submitted U.S. marketing application for experimental type 2 diabetes drug, tirzepatide, and started real-time review of data needed to secure regulatory approval for its Alzheimer’s disease drug, donanemab.

“The timing is in-line with Street expectations, but this is still good news since the launch of both drugs are important, in our view, in 2022,” Cantor Fitzgerald analyst Louise Chen said.

Lilly’s shares are up about 45% so far this year, fueled largely by bets it will land another blockbuster with donanemab, which is set to compete upon approval with Biogen’s Aduhelm, which also aims to remove clumps of a protein called beta amyloid from the brains of early stage Alzheimer’s patients.

Lilly raised its forecast for this year’s adjusted earnings per share to between $$7.95 and $8.05 from an earlier $7.80 to $8.00 range, despite missing third quarter profit estimates.

The company said it now expected COVID-19 therapies to bring in about $1.3 billion in sales in 2021, up from an earlier forecast of between $1.0 billion and $1.1 billion.

Demand for Lilly’s COVID-19 antibody therapies, bamlanivimab and etesevimab, rose during the last three months as the spread of the Delta variant fueled a sharp rise in infections and hospitalizations in areas with low vaccination rates.

The therapies brought in $217 million in the third quarter, up from $149 million in the second.

(Reporting by Manojna Maddipatla and Mrinalika Roy in BengaluruEditing by Ankur Banerjee and Tomasz Janowski)