For other uses, see Eli Lilly (disambiguation).
|Eli Lilly and Company|
|Type||Public (NYSE: LLY)|
|Headquarters||Indianapolis, Indiana, USA|
|Key people||Sidney Taurel, Chairman
John C. Lechleiter, President & CEO
Derica Rice, CFO
Eli Lilly, Founder
|Revenue||▲ US$21.8 Billion (FY 2009)|
|Operating income||▲ US$5.66 Billion (FY 2009)|
|Net income||▲ US$4.33 Billion (FY 2009)|
|Total assets||▼ US$27.5 Billion (FY 2009)|
|Total equity||▲ US$9.52 Billion (FY 2009)|
Eli Lilly and Company (NYSE: LLY) is a global pharmaceutical company. Eli Lilly’s global headquarters is located in Indianapolis, Indiana, in the United States. The company was founded in 1876 by a pharmaceutical chemist, Eli Lilly, after whom the company was ultimately named.
Among other specialties, Lilly was the first company to mass-produce penicillin and today is the world’s largest manufacturer and distributor of psychiatric medications.
Eli Lilly and Company’s global headquarters, in Indianapolis, Indiana, United States
A Fortune 500 corporation, Eli Lilly had revenues of $20 billion in 2008, making it the 148th largest company in the United States and the 10th largest corporation by global pharmaceutical sales. The company is publicly traded on the New York Stock Exchange and is a member of theS&P 500 stock index. Eli Lilly was one of the Nifty Fifty stocks that propelled the mid 20th century bull market.
Eli Lilly is a full member of the European Federation of Pharmaceutical Industries and Associations (EFPIA).
Colonel Eli Lilly, a pharmacist and a veteran of the American Civil War, began formulating plans to create a medical wholesale company while working in partnership at a drug store named Binford & Lilly. His wife’s death from malaria a few years earlier influenced him to see a need for quality and effective drugs to be made available on a large scale. In 1873, Lilly returned to his hometown of Indianapolis and opened a store with a partner to begin working towards his goal, Johnson & Lilly. He slowly saved up enough money to open a store of his own.
A photo of Lilly’s first laboratory building.Eli Lilly and son Josiah K. Lilly, Sr. are on the left side of the doorway.
Lilly’s Indianapolis store started in 1876 with only three employees, including his 14-year-old son Josiah, and $1,400 in working capital. His first innovation was gelatin-coating for pills and capsules. Following on his experience of low-quality medicines used in the Civil War, Lilly committed himself to producing only high-quality prescription drugs, in contrast to the common and often ineffective patent medicines of the day. His products, which worked as advertised and gained a reputation for quality, began to become popular in the city. In his first year of business, sales reached $4,470 and by 1879, they had grown to $48,000. He hired his brother, James, to take over sales in 1878. Other family members were also employed by the growing company, his cousin Evan Lilly was hired as a bookkeeper; his grandsons Eli and Josiah were hired to run errands and other odd jobs. In 1881 he formally incorporated the company, naming it Eli Lilly and Company. By the late 1880s he was one of the area’s leading businessmen with over one-hundred employees and $200,000 in annual sales.
An assortment of Lilly’s throat lozengesfrom a 1906 sales book.
Eli Lilly and company was the first pharmaceutical company of its kind. At first Lilly was the company’s only researcher, but as his business grew, he created a laboratory and employed a department dedicated to creating new drugs. He hired his first scientist dedicated to research in 1886. Their methods of research were based on Lilly’s. He also insisted on quality assurance, and instituted mechanisms to ensure that the drugs being produced worked as advertised, had the correct combination of ingredients, and that only the correct dosage of medicines was contained in each pill. He was aware of the addictive and dangerous nature of some of his drugs, and also pioneered the concept of only giving such drugs to people who had first seen a physician to determine if they needed the medicine.
Colonel Eli Lilly (1838–1898), founder
Among the company’s innovations was fruit flavoring for medicines and sugarcoated pills making their medicines easier to take. His growing business led him to purchase additional facilities for research and production. He began to purchase a complex of buildings on McCarty Street in south Indianapolis, other businesses followed and the area began to develop into a major business area of the city. In 1890 he turned over his business to his son Josiah, who ran the company for the several decades. He focused his own free time on growing number of the civic organizations he was involved in, including the Charity Organization Society, the forerunner of the United Way.The 1890s were a tumultuous decade economically, but the company was able to survive and came out stronger than ever. In 1894 the company purchased a plant to be used solely for creating capsules. Several technological advances were achieved by the company, and the creation was automated. Over the next few years the company began to create tens of millions of capsules and pills annually.
Josiah K. Lilly, Sr. (1861–1948), second company president.
When Eli Lilly died in 1898, his son Josiah K. Lilly, Sr. inherited the company. Josiah also continued his father’s civic mindedness and ordered the company to send much needed medicine to support recovery efforts following the 1906 San Francisco earthquake. Josiah oversaw a large expansion of the company and advocated government regulation of medicines, leading to the passages of the Pure Food and Drug Law in 1906. In 1919, Josiah Lilly hired biochemist George Henry Alexander Clowes as director of biochemical research. Clowes’ negotiations with researchers who developed insulin at the University of Toronto helped launch the first successful large-scale production of insulin in 1923. The success of insulin enabled the company to attract well-respected scientists and, with them, make more medical advances. Like his father, Josiah retired from the business and turned it over to his oldest son so he could take a more active role in philanthropy.
Eli Lilly (1885–1977), third company president.
Eli Lilly, the grandson of Col. Lilly, was named as the company’s president in 1932 to succeed his father. In 1934, he led the company to make its first venture overseas when a Lilly office was opened in England. World War II brought production at Lilly to a new high with the manufacturing of Merthiolate and blood plasma. In 1943, the company began full-scale production of penicillin, the first company to mass produce the new medicine.
Eli Lilly International Corp. was formed in 1943 as a subsidiary to encourage business trade abroad. In 1945, the company opened a new plant on South Kentucky Avenue in Indianapolis and, by 1948, Lilly employed nearly 7,000 people. The same year, Eli Lilly relinquished the presidency to his brother, Josiah K. Lilly, Jr. In 1952, Josiah, Jr. took the company public; the first public shares of stock were offered and, in 1953, Eugene N. Beesley was named the company’s new president. He was the first non-family member to run the company.
Lilly continued to expand. In 1950, Tippecanoe Laboratories, in Lafayette, Indiana, increased antibiotic production with its patent onerythromycin. In 1954, Elanco Products Co. was formed for the production of veterinary pharmaceuticals. In 1963, with an acquisition from Distillers Company, the company established a major factory in Liverpool. In 1968, Lilly Research Centre Ltd. near London, England was built. It was the company’s first research facility outside the United States. In 1969, the company opened a new plant in Clinton, Indiana.
Lilly made an uncharacteristic, but ultimately profitable, move in 1971 when it bought cosmetic manufacturer Elizabeth Arden for $38 million. Sixteen years later, Lilly sold Arden to Fabergé in 1987 for $657 million.
Richard Wood was named CEO of Lilly in 1973. During the 1970s and 1980s, Eli Lilly and Company saw a flurry of drug production: antibioticKeflex in 1971; heart drug Dobutrex in 1977; Ceclor, which would become the world’s top selling oral antibiotic, in 1979; leukemia drug Eldisine; antiarthritic Oraflex; and analgesic Darvon.
Lilly ventured into medical instruments through the acquisition of IVAC Corp., which manufactures vital signs and intravenous fluid infusion monitoring systems. Lilly also purchased Cardiac Pacemaker, a manufacturer of heart pacemakers.
In 1989, a joint agri-chemical venture between Elanco Products Co. and Dow Chemical created DowElanco. In 1997, Lilly sold its 40 percent share in the company to Dow Chemical for $1.6 billion and the name was changed to Dow AgroSciences
In 1991, Vaughn Bryson was named CEO of Eli Lilly. During his 18-month tenure, the company reported its first quarterly loss ever. Randall L. Tobias, former vice-chairman of AT&T, was named Bryson’s replacement in 1993. He was the first official recruited from outside of the company. Sidney Taurel, former chief operating officer of Lilly was named CEO in 1998, replacing Tobias. Taurel was named chairman in January 1999.
Eli Lilly’s present day global manufacturing plants.
In 1998, Eli Lilly formed a joint venture with Icos Corporation (ICOS), a Bothell, Washington based biotechnology company, to develop and commercialize Cialis for the treatment of erectile dysfunction. In October 2006, Eli Lilly announced its intention to acquire Icos, for $2.1 billion, or $32 a share. The initial attempt to acquire Icos failed under pressure from large institutional shareholders, causing Lilly to offer $34 per share. ISS, a proxy advisory firm, advised Icos shareholders to reject the proposal as undervalued. However, the acquisition was approved by Icos shareholders and Eli Lilly completed its acquisition of the company on January 29, 2007. Since ICOS had no other products in development beyond Cialis, Eli Lilly promptly closed Icos operations and terminated nearly 500 Icos employees, except for 127 employees working at the biologics facility. In December 2007, CMC Biopharmaceuticals A/S (CMC), a Copenhagen, Denmark-based provider of contract biomanufacturing services, bought the Bothell-based biologics facility from Eli Lilly and retained the existing 127 employees.
In January 2009, the largest criminal fine in U.S. history was imposed on Lilly for illegal marketing of its best-selling product, the atypical antipsychotic medication, Zyprexa.
In addition to internal research and development activities Eli Lilly is also involved in publicly funded collaborative research projects, with other industrial and academic partners. One example in the area of non-clinical safety assessment is the InnoMed PredTox. The company is expanding its activities in joint research projects within the framework of the Innovative Medicines Initiative of EFPIA and the European Commission.
Among the company’s major pharmaceutical breakthroughs are cephalosporin, erythromycin, insulin, and Prozac (fluoxetine), a selective serotonin reuptake inhibitor (SSRI) for the treatment of clinical depression.
Among other distinctions, Lilly is the world’s largest manufacturer and distributor of medications used in a broad range of psychiatric andmental health-related conditions, including clinical depression, generalized anxiety disorder, narcotic addiction, insomnia, bipolar disorder,schizophrenia, and others.
Further information: Tadalafil
In 2003, Eli Lilly introduced Cialis (tadalafil), a competitor to Pfizer’s blockbuster Viagra for erectile dysfunction. Cialis maintains an active period of 36 hours, causing it sometimes to be dubbed the “weekend pill”. Cialis was developed in a partnership with biotechnology company Icos Corporation. On December 18, 2006 Lilly bought Icos in order to gain full control of the product.
With its television advertisement for Cialis during the 2004 Super Bowl Halftime Show, Eli Lilly was one of several companies whose costly 2004 Super Bowl Halftime advertisements were largely overshadowed by the Janet Jackson and Justin Timberlake Super Bowl XXXVIII halftime show controversy.
Further information: Duloxetine
Another Lilly manufactured anti-depressant, Cymbalta, a serotonin-norepinephrine reuptake inhibitor used predominantly in the treatment of major depressive disorders and generalized anxiety disorder, ranks with Prozac as one of the most financially successful pharmaceuticals in industry history. It is also used in the treatment of fibromyalgia and neuropathy.
Further information: Gemcitabine
In 1996, the U.S. Food and Drug Administration approved Gemzar for the treatment of pancreatic cancer. Gemzar is commonly used in the treatment of pancreatic cancer (usually in coordination with 5-FU chemotherapy and radiology). Gemzar also is routinely used in the treatment of non-small cell lung cancer.
Further information: Methadone
Eli Lilly was the first distributor of methadone, an analgesic used frequently in the treatment of heroin, opium and other opioid and narcoticdrug addictions.
Further information: Fluoxetine
Prozac was one of the first therapies in its class to treat clinical depression by blocking the uptake of serotonin within the human brain. It is prescribed to more than fifty-four million people worldwide.
Prozac has given rise to a number of comparably-functioning therapies for the treatment of clinical depression and other central nervous system disorders such as obsessive compulsive disorder, bulimia nervosa, and panic disorders.
Because of its wide appeal as a popular anti-depressant, Prozac has had numerous references to it in popular culture, including many books, movies, and songs. The autobiographical book Prozac Nation was authored in 1994 by Elizabeth Wurtzel; it was turned into a movie of the same name, Prozac Nation, in 2001, starring Christina Ricci. A 1993 book, Listening to Prozac, was a generally critical look at Prozac and its side effects. Another book, Talking Back to Prozac, also focuses on Prozac side effects.
Further information: Secobarbital
Eli Lilly has manufactured Secobarbital, a barbiturate derivative with anaesthetic, anticonvulsant, sedative and hypnotic properties. Lilly marketed Secobarbital under the brand name Seconal.
Secobarbital is indicated for the treatment of epilepsy, temporary insomnia and as a pre-operative medication to produce anaesthesia andanxiolysis in short surgical, diagnostic, or therapeutic procedures which are minimally painful. With the onset of new therapies for the treatment of these conditions, Secobarbital has been less utilized, and Lilly ceased manufacturing it in 2001.
Secobarbital gained considerable attention during the 1970s, when it gained popularity as a recreational drug. On September 18, 1970, rockguitarist legend Jimi Hendrix died from a secobarbital overdose. On June 22, 1969 secobarbital overdose was the cause of death of actressJudy Garland. The drug was a central part of the plot of the hugely popular novel Valley of the Dolls by Jacqueline Susann in which three highly successful Hollywood women each fall victim, in various ways, to the drug. The novel was later released as a film by the same name.
Further information: Thiomersal
Eli Lilly has developed the vaccine preservative Thiomersal (also called Merthiolate and Thimerosal). Thiomersal is effective by causing susceptible bacteria to autolyze.
A number of global leaders in the fields of health policy, management, and scientific research have worked at Lilly, including:
Prominent Lilly board members have included:
In 2006, Fortune magazine named Eli Lilly and Company one of the top 100 companies in the United States for which to work. Also in 2006,Barron’s Magazine named the company among the top 500 best managed companies in the U.S. The company was named one of the top 10 best companies for working mothers in 2004 by Working Mothers magazine.
Main article: Eli Lilly controversies
Eli Lilly has been involved in numerous controversies, including political and medical ethics controversies. Eli Lilly is now the sole manufacturer of BGH (having purchased the rights to manufacture the drug from Monsanto), the artificial hormone given to dairy cows that may increase people’s risk of cancer.
Further information: Standard Gravure shooting
In one of three cases to ever go to trial for SSRI indication in suicide, a Kentucky man, Joseph Wesbecker, who had been on Prozac, went to his workplace and opened fire, killing seven people and injuring 12 others before turning the gun on himself. The jury returned a 9-to-3 verdict in favor of Lilly. The case's judge, however, took the matter to the Kentucky Supreme Court, which found that "there was a serious lack of candor with the trial court and there may have been deception, bad faith conduct, abuse of judicial process and, perhaps even fraud." The judge later revoked the verdict and instead recorded the case as settled. The value of the secret settlement deal has never been disclosed.
In June 2008, Eli Lilly and Company agreed to settle a lawsuit stemming from discrimination charges. The lawsuit alleged that the company withheld severance pay in order to convince a former employee, Starr E. Johnson, to withdraw her lawsuit. Eli Lilly was accused by the U.S.Equal Employment Opportunity Commission of violating the federal anti-discrimination law when they withheld severance benefits to Johnson. Johnson originally filed a discrimination charge after she was fired in 2005. She is a black woman and became disfigured in 1997 when she was exposed to a blood pathogen. Her charge claimed that her supervisor stated that he was put in charge "so that he could watch her and get rid of her and that no one liked looking at her." Eli Lilly was ordered to pay $54,400 in severance pay, $7,000 in interest and compensatory damages, along with $3,000 in attorney fees.
Eli Lilly pleaded guilty to violating U.S. law in its marketing of its anti-psychotic drug Zyprexa and was ordered to pay $1.42 billion to settle criminal and civil allegations. Eli Lilly said it had entered a misdemeanor plea for violation of federal law in its off-label promotion of Zyprexa between September 1999 and March 2001 and agreed to pay 615 million dollars.
The U.S. Justice Department said the criminal fine of 515 million dollars was the largest ever in a health care case, and the largest criminal fine for an individual corporation ever imposed in a U.S. criminal prosecution of any kind. Lilly also agreed to forfeit $100 million dollars in the settlement. However, the company is still pursuing legal action against the lawyer, James Gottstein, who helped publicize the issues by passing documents to The New York Times and other media outlets.