What changed in this filing

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Item 1. Business

2025-02-19 compared with 2024-02-21 · 192 added, 184 removed, 408 unchanged (48% of the section changed)

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Our purpose is to unite caring with discovery to create medicines that make life better for people around the world.

Most of the products that we sell today were discovered or developed by our own scientists, and our long-term success depends on our ability to continually discover or acquire, develop, and commercialize innovative medicines.

Our long-term success depends on our ability to continually discover or acquire, develop, and commercialize innovative medicines.

We manufacture and distribute our products through facilities in the United States (U.S.), including Puerto Rico, and in Europe and Asia.

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Certain Indications

Diabetes, Obesity and Other Cardiometabolic products

Cardiometabolic Health products

In collaboration with Boehringer Ingelheim, a long-acting human insulin analog for the treatment of diabetes.

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and to reduce the risk of major adverse cardiovascular events in adult patients with type 2 diabetes and established cardiovascular disease or multiple cardiovascular risk factors.

For the treatment of adults with obesity or overweight with weight-related comorbidities as an adjunct to a reduced-calorie diet and increased physical activity (marketed under Mounjaro in the European Union (EU) and in various other markets outside the U.S.).

For the treatment of adults with obesity or overweight with at least one weight-related comorbid condition in combination with a reduced-calorie diet and increased physical activity;

and for the treatment of moderate to severe obstructive sleep apnea in adults with obesity in combination with a reduced-calorie diet and increased physical activity (relevant indications marketed under Mounjaro in various markets outside the U.S.).

Therapeutic area

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Oncology products

For the first-line treatment, in combination with two other agents, of advanced non-small cell lung cancer (NSCLC) for patients with non-squamous cell histology and no epidermal growth factor receptor or anaplastic lymphoma kinase genomic tumor aberrations;

for the first-line treatment, in combination with another agent, of advanced non-squamous NSCLC;

for the second-line treatment of advanced non-squamous NSCLC;

as monotherapy for the maintenance treatment of advanced non-squamous NSCLC in patients whose disease has not progressed immediately following chemotherapy treatment;

and in combination with another agent for the treatment of malignant pleural mesothelioma.

For use as monotherapy or in combination with another agent as a second-line treatment of advanced or metastatic gastric cancer or gastro-esophageal junction adenocarcinoma;

in combination with another agent as a second-line treatment of metastatic NSCLC;

in combination with another agent as a second-line treatment of metastatic non-small cell lung cancer (NSCLC);

in combination with another agent as a second-line treatment of metastatic colorectal cancer;

as a monotherapy as a second-line treatment of hepatocellular carcinoma;

and in combination with another agent as a first-line treatment of adult patients with metastatic NSCLC with activating epidermal growth factor receptor mutations.

and in combination with another agent as a first-line treatment of adult patients with metastatic NSCLC with activating epidermal growth factor receptor (EGFR) mutations.

Indicated both as monotherapy and in combination with another agent for the treatment of certain types of colorectal cancers;

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for the first-line treatment of gastric cancer in combination with two other agents;

and, in combination with two other agents, for patients with epidermal growth factor receptor (EGFR)-mutated non-squamous NSCLC that progressed after EGFR-tyrosine kinase inhibitor therapy, each in China.

and, in combination with two other agents, for patients with EGFR-mutated non-squamous NSCLC that progressed after EGFR-tyrosine kinase inhibitor therapy, each in China.

For use as monotherapy or in combination with endocrine therapy for the treatment of HR+, HER2- metastatic breast cancer, and in combination with endocrine therapy for treatment of HR+, HER2-, node positive, early breast cancer at high risk of recurrence.

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Immunology products

For the treatment of adult and adolescent patients 12 years or older with moderate to severe atopic dermatitis in Japan and, in collaboration with Almirall S.A., in Europe.

For the treatment of adult and adolescent patients 12 years or older with moderate to severe atopic dermatitis (in Europe, in collaboration with Almirall S.A.).

In collaboration with Incyte Corporation, for the treatment of adults with moderately to severely active rheumatoid arthritis after treatment with one or more tumor necrosis factor (TNF) blockers that did not work well enough or could not be tolerated;

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and for the treatment of hospitalized adults with COVID-19 who require supplemental oxygen, mechanical ventilation, or extracorporeal membrane oxygenation.

For the treatment of adults with moderately to severely active ulcerative colitis.

For the treatment of moderately to severely active ulcerative colitis in adults and for the treatment of moderately to severely active Crohn's disease in adults.

For the treatment of adults and pediatric patients aged 6 years or older with moderate to severe plaque psoriasis;

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Neuroscience products

For the treatment of major depressive disorder;

diabetic peripheral neuropathic pain;

generalized anxiety disorder;

fibromyalgia;

and chronic musculoskeletal pain due to chronic low back pain or chronic pain due to osteoarthritis.

For migraine prevention and the treatment of episodic cluster headache in adults.

Other products and therapies

For the treatment of erectile dysfunction and benign prostatic hyperplasia.

For the treatment of osteoporosis in men and postmenopausal women at high risk for broken bones or fracture and for glucocorticoid-induced osteoporosis in men and women.

For adults with early symptomatic Alzheimer's disease with confirmed amyloid pathology and with mild cognitive impairment or mild dementia stage of disease.

Marketing and Distribution

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We adapt our marketing methods and product emphasis in various countries to meet local customer needs and comply with local regulations.

We promote our major products in the U.S.

through sales representatives who engage with physicians and other healthcare professionals.

We also educate healthcare providers about our products in various other ways, including promoting in online channels, distributing literature and samples of certain products to physicians, and exhibiting at medical meetings.

We educate healthcare providers about our products in various ways, including promoting in online channels, distributing literature and samples of certain products to physicians, and exhibiting at medical meetings.

In addition, we advertise certain products directly to consumers in the U.S., and we maintain websites and other media channels (e.g., social media) with information about our major products.

We supplement our employee sales force with contract sales organizations to leverage our resources and reach additional patients in need.

Promotion of our major products in the U.S.

includes engagement by employee or contracted sales representatives with physicians and other healthcare professionals.

Our account managers service wholesalers, pharmacy benefit managers, managed care organizations, group purchasing organizations, government and long-term care institutions, hospitals, and certain retail pharmacies.

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In the U.S., most of our products are distributed through wholesalers that serve pharmacies, physicians and other healthcare professionals, and hospitals.

In 2023, 2022, and 2021, three wholesale distributors in the U.S.—McKesson Corporation, Cencora, Inc.

(formerly AmerisourceBergen Corporation), and Cardinal Health, Inc.—each accounted for a significant percentage of our consolidated revenue.

In 2024, 2023, and 2022, three wholesale distributors in the U.S.—McKesson Corporation, Cencora, Inc., and Cardinal Health, Inc.—each accounted for a significant percentage of our consolidated revenue.

No other customer accounted for more than 10 percent of our consolidated revenue in any of these years.

For additional information, see Item 8, "Financial Statements and Supplementary Data—Note 2:

We recently launched LillyDirect, a direct-to-consumer digital health care platform designed to, among other things, provide patients in the U.S.

living with obesity, migraine and diabetes with tools to help them access care from independent healthcare providers, as well as the option for home delivery of select prescribed Lilly medicines through third-party pharmacies.

Programs to assist patients in adhering to treatment plans are also available for use.

We have launched, and continue to explore, new partnerships and tools, including through LillyDirect, to expand access to our medicines.

New initiatives may expose us to new risks or exacerbate existing risks.

See, for examples, Item 1A, "Risk Factors—Risks Related to Our Operations—Failure, inadequacy, breach of, or unauthorized access to, our IT systems or those of our third-party service providers, unauthorized access to our confidential information, or violations of data protection laws, could each result in material harm to our

business and reputation" and "Risk Factors—Risks Related to Litigation and Government Regulation—Regulatory compliance problems could be damaging to the company."

Outside the U.S.

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Outside the U.S., we promote our products to healthcare providers through sales representatives and other channels.

In most countries in which we operate, we maintain our own sales organizations, but in some countries we market our products through third parties, some of which we have engaged through distribution and promotion arrangements.

We maintain our own sales organizations in many countries.

We also often utilize third parties for commercial sales operations, some of which are engaged through distribution and promotion arrangements.

Marketing Collaborations

Certain of our products are marketed in arrangements with other pharmaceutical companies.

For example, we and Boehringer Ingelheim have a global agreement to develop and commercialize a portfolio of diabetes products, including Trajenta ® , Jentadueto ® , Jardiance, Glyxambi ® , Synjardy ® , Trijardy ® XR, Basaglar, and Rezvoglar ® .

For example, we and Boehringer Ingelheim have a global agreement to develop and commercialize a portfolio of diabetes products, including Jardiance, Glyxambi, Synjardy, and Trijardy XR.

For additional information, see Item 8, "Financial Statements and Supplementary Data—Note 4:

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Our products compete globally with many other pharmaceutical products in highly competitive markets.

Important competitive factors include effectiveness, safety, and ease of use;

Important competitive factors include effectiveness, safety, availability, ease of use, and overall patient experience;

formulary placement, price, payer coverage and reimbursement rates, and demonstrated cost-effectiveness;

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marketing effectiveness;

and research and development of new products, processes, modalities, and uses.

and research and development of new products, processes, modalities, indications, and uses.

Early market entry and rapid patient access can also be important to achieve product acceptance and success.

Most new products or uses that we introduce must compete with other branded, biosimilar, or generic products already on the market or that are later developed by competitors.

When competitors introduce new products, uses, or delivery systems with therapeutic or cost advantages, including by developing new modalities, our products become subject to decreased sales volumes, progressive price reductions, or both.

We believe our long-term competitive success depends on discovering and developing (either alone or in collaboration with others) or acquiring innovative, cost-effective products that provide improved outcomes for patients and deliver value to payers, and continuously improving the productivity of our operations in a highly competitive environment.

There can be no assurance that our efforts will result in commercially successful products, and it is possible that our products will be, or will become, uncompetitive from time to time as a result of products or uses developed by our competitors.

Barriers to reimbursable patient access in some cases include default payer coverage restrictions for our medicines.

For example, in the U.S., anti-obesity medicines are often excluded from commercial benefit plans.

Self-insured employers must opt in for coverage of these medicines.

Medicare and payers in various international markets also have not covered anti-obesity medicines for weight loss.

Our anti-obesity medicines comprise a significant portion of our revenues, and barriers to reimbursable patient access may impact our sales volumes, business, and results of operations.

Most new products or uses that we introduce must compete with other branded, biosimilar, or generic products already on the market or that are later developed.

When new products, uses, or delivery systems with therapeutic, convenience, or cost advantages are introduced, including by developing new modalities, our existing products become subject to decreased sales volumes, progressive price reductions, or both.

We believe our long-term competitive success depends on discovering and developing or acquiring innovative, cost-effective products that provide improved outcomes for patients and deliver value to payers, and continuously improving the productivity of our operations in a highly competitive environment.

There can be no assurance that our efforts will result in commercially successful products, and it is possible that our products or indications will be, or will become, uncompetitive from time to time.

See also "—Competition—U.S.

Private Sector Dynamics."

Generic Pharmaceuticals, Biosimilars, and Compounding

Generic Pharmaceuticals and Biosimilars

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A biosimilar is a subsequent version of an approved innovator biologic that, due to its analytical and clinical similarity to the innovator biologic, may be approved based on an abbreviated data package that relies in part on the full testing required of the innovator biologic.

Globally, most governments have developed abbreviated regulatory pathways to approve biosimilars as follow-ons to innovator biologics, including the Biologics Price Competition and Innovation Act of 2009 (the BPCIA) in

A number of biosimilars have been licensed under the BPCIA, as well as in Europe and Japan.

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While competitors have developed biosimilars that compete with our products, we have developed our own biosimilar and may develop others in the future.

In recent periods, we have seen an increase in the production, marketing, and sale of counterfeit, misbranded, adulterated, and compounded incretins.

These practices may impact patient safety, undermine regulatory drug approval processes, and present market risks.

If inadequately regulated, these practices could materially impact our business and reputation, including by creating consumer confusion or misperceptions about the safety and efficacy of our genuine products, diversion of potential sales, and potential net price erosion for our products.

See Item 1, "Business—Government Regulation of Our Operations and Products," for additional information on market risks related to counterfeit, misbranded, adulterated, and compounded medicines.

Private Sector Dynamics

private sector, consolidation and integration among healthcare organizations significantly affects the competitive marketplace for pharmaceuticals.

Health plans, managed care organizations, pharmacy benefit managers, wholesalers, pharmacies, and other supply chain entities have been consolidating into fewer, larger entities, thus enhancing their market power and importance.

Health plans, managed care organizations, pharmacy benefit managers, wholesalers, pharmacies, and other supply chain entities have consolidated into fewer, larger entities, thus enhancing their market power and importance.

Private third-party insurers, as well as governments, typically maintain formularies that specify coverage (the conditions under which drugs are included on a plan's formulary) and reimbursement (the associated out-of-pocket cost to the consumer) to control costs by negotiating discounts or rebates in exchange for formulary inclusion and placement.

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In addition, for some products we have effective intellectual property protection in the form of data protection under pharmaceutical regulatory laws.

The patent protection anticipated to be of most relevance to pharmaceuticals is provided by patents claiming the active ingredient (the compound patent) for our products, particularly those in major markets such as the U.S., major European countries, and Japan.

The patent protection generally anticipated to be of most relevance to pharmaceuticals is provided by patents claiming the active ingredient (the compound patent) for our products, particularly those in major markets such as the U.S., major European countries, and Japan.

In general, patents in each relevant country last for a period of 20 years from their filing date, which is often years prior to the launch of a commercial product.

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Food and Drug Administration (FDA) review process.

There is a five-year cap on any restoration, and no patent's

expiration date may be extended beyond 14 years from FDA approval.

There is a five-year cap on any restoration, and no patent's expiration date may be extended beyond 14 years from initial FDA approval.

Some countries outside the U.S.

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The primary forms of data protection are as follows:

• Data package protection generally prohibits other manufacturers from submitting regulatory applications for marketing approval in reliance on the innovator company's regulatory submission data for the drug.

• Data package protection generally prohibits regulatory approval of other manufacturers' applications for marketing approval if they rely on the innovator company's regulatory submission data for the drug.

The base period is generally five years in the U.S.

(12 years for new biologics under the BPCIA, subject to certain conditions), effectively 10 years in Europe, and eight years in Japan.

(12 years for new biologics under the BPCIA, subject to certain conditions), effectively 10 years in Europe, and eight years in Japan, which can be extended to 10 years with qualifying pediatric studies.

The period begins on the date of product approval and runs concurrently with the patent term for any relevant patents.

Legislative bodies in the European Union (EU) are discussing proposed reductions in data protection periods but it remains uncertain if, or when, these proposals might be adopted.

• In the U.S., the FDA has the authority to grant additional data protection for approved drugs where the sponsor conducts specified testing in pediatric populations within a specified time period.

If granted, this "pediatric exclusivity" provides an additional six months of exclusivity, which is added to the term of data protection, orphan drug exclusivity and, for products other than biologics, to the term of any relevant and non-expired patents.

If granted, this "pediatric exclusivity" provides an additional six months of exclusivity, which is added to the term of data protection, orphan drug exclusivity and, for products other than biologics, pediatric exclusivity is also added to the term of any relevant and non-expired patents.

• A specific use of a drug or biologic can receive "orphan" designation in the U.S.

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We consider intellectual property protection for certain products, processes, uses, and formulations to be important to our business.

In addition to the patents and data protection identified below, we may hold patents on manufacturing processes, formulations, devices, or uses that extend exclusivity beyond the dates shown below.

For approved products, dates include, where applicable, pending or granted patent term extensions.

In addition to the patents and data protection identified below, we may hold patents on manufacturing processes, formulations, devices, or uses that provide protection beyond the estimated dates shown below.

For approved products, estimated dates include, where applicable, pending or granted patent term extensions.

Where granted, estimated dates for approved products also reflect pediatric or orphan drug exclusivity.

The length of market exclusivity for our products can be difficult to predict with certainty because of the complex interaction between patent and regulatory forms of exclusivity and the inherent uncertainties regarding patent litigation.

There can be no assurance that a particular product will maintain market exclusivity for the duration of the estimated expiry or that exclusivity will be limited to that time frame.

The most relevant patent protection or data protection and associated expiry dates for our major or recently launched patent-protected marketed products are as follows:

Therapeutic Area

Diabetes, Obesity and Cardiometabolic products

compound patent

Therapeutic Area Product Protection Territory Estimated Expiry Date

Cardiometabolic Health products Jardiance compound patent U.S.* 2029

major European countries 2029

Mounjaro/ Zepbound

compound patent

major European countries

data protection

major European countries

compound patent

major European countries

biologics data protection

data protection

compound patent U.S.

major European countries 2037

Oncology products

compound patent

data protection U.S.

major European countries 2033

biologics data protection

data protection

Trulicity compound patent U.S.

major European countries 2029

compound patent

biologics data protection U.S.

data protection major European countries 2024

Therapeutic Area Product Protection Territory Estimated Expiry Date

Oncology products Cyramza compound patent U.S.

major European countries 2028

data protection

biologics data protection U.S.

data protection major European countries 2024

Jaypirca compound patent U.S.

major European countries 2038

compound patent

data protection U.S.

major European countries 2033

data protection

Retevmo compound patent U.S.

major European countries 2037

compound patent

data protection U.S.

major European countries 2031

data protection

Verzenio compound patent U.S.

major European countries 2033

Therapeutic Area

data protection major European countries 2028

Immunology products

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major European countries

biologics data protection U.S.

data protection

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major European countries

Therapeutic Area Product Protection Territory Estimated Expiry Date

Neuroscience products

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major European countries

Kisunla compound patent

biologics data protection

data protection

compound patent

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Upon approval, we expect relevant compound patent and data protections to apply:

• Donanemab has been submitted for regulatory review in the U.S., the EU and Japan for the treatment of early Alzheimer's disease.

• Lebrikizumab has been submitted for regulatory review in the U.S.

for the treatment of moderate to severe atopic dermatitis.

• Pirtobrutinib has been submitted for regulatory review in Japan for the treatment of certain patients with relapsed or refractory mantle cell lymphoma.

Worldwide, we sell all of our major products under trademarks consisting of our product names, logos, and unique p roduct appearances that we consider in the aggregate to be important to our operations.

• Donanemab has been submitted for regulatory review in the EU for the treatment of early Alzheimer's disease.

• Imlunestrant has been submitted for regulatory review in the U.S., the EU, and Japan for the treatment of ER-positive HER2-negative metastatic breast cancer.

Worldwide, we sell all of our major products under trademarks consisting of our product names, logos, and unique product appearances that we consider in the aggregate to be important to our operations.

Trademark protection varies throughout the world.

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Generic drug companies and even some investment firms have engaged in the IPR process in attempts to invalidate our patents.

In addition, in December 2023, the U.S.

presidential administration released a proposed framework that would permit the federal government to consider the price of a drug developed using federal funds as a factor in determining whether it may exercise "march-in rights" and license it to a third party to manufacture.

A comment period on the proposal runs through February 6, 2024, and we are not able to predict whether a final rule will be adopted in accordance with the proposed framework.

In recent years, U.S.

government officials have proposed the exercise of "march-in-rights" and various other measures that, if enacted, could have a negative impact on our patent rights.

We cannot predict the likelihood that these or similar proposals will be adopted, but, if adopted, our business and results of operations could be adversely affected.

Outside the U.S., the legal doctrines and processes by which pharmaceutical patents can be challenged vary widely.

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Contingencies."

Government Regulation of Our Operations

Government Regulation of Our Operations and Products

Our operations are regulated extensively by numerous government agencies.

Regulation of Products

The lengthy process of laboratory and clinical testing, data analysis, manufacturing development, and regulatory review necessary for governmental approvals of our products is extremely costly and can significantly delay product introductions and revenue generation.

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Evolving regulatory priorities have intensified governmental scrutiny of our operations and those of other healthcare intermediaries, including with respect to current Good Manufacturing Practices (cGMP), quality assurance, and similar regulations.

Regulatory oversight of the pharmaceutical industry entails judgment and interpretation, which can result in inconsistent administration of laws and regulations by health authorities.

Compliance with the laws and regulations affecting the manufacture and sale of current products and the discovery, development, and introduction of new products and uses has and will continue to require substantial effort, expense, and capital investment.

Regulatory oversight of the pharmaceutical industry entails judgment and interpretation, which can result in varying interpretations of laws and regulations by health and other authorities.

In addition, changing political leadership, including the new presidential administration and regulatory authorities in the U.S., may propose, enact, or pursue policy, regulatory, and enforcement changes that create additional uncertainty for our business.

Compliance with the laws and regulations affecting the manufacture and sale of our current products and the discovery, development, and introduction of new products and uses has and will continue to require substantial effort, expense, and capital investment.

Of particular importance to our business is regulation by the FDA in the U.S.

Pursuant to laws and regulations that include the Federal Food, Drug, and Cosmetic Act (FDCA), the FDA has jurisdiction over all of our products and devices in the U.S.

Pursuant to laws and regulations that include the Federal Food, Drug, and Cosmetic Act (FDCA) and the Public Health Service Act (PHS), the FDA exercises jurisdiction over all of our products and devices in the U.S.

and administers requirements covering the testing, safety, effectiveness, manufacturing, quality control, distribution, labeling, marketing, promotion, advertising, dissemination of information, and post-marketing surveillance of those products and devices.

The FDA holds broad discretion under the FDCA and other statutes to interpret the conditions and evidence necessary for timely approval of our drugs and devices.

Following approval, our products remain subject to regulation by various government and regulatory agencies in connection with labeling, import, export, sale, storage, recordkeeping, advertising, promotion, and safety reporting.

The FDA holds broad discretion under the FDCA to interpret the conditions and evidence necessary for timely approval of and ability to market our drugs and devices as well as those of our competitors.

The centrality to our business of the FDA and corresponding international regulators exposes us to risks of oversight, administrative, and enforcement changes, delays, inconsistencies, lapses, or failures, including as may derive from insufficient staffing levels, expertise, or resources.

Following approval, our products must meet, and must continue to comply with, regulation by various government and regulatory agencies in connection with labeling, import, export, sale, storage, recordkeeping, advertising, promotion, and safety reporting.

We conduct extensive post-marketing surveillance of the safety of the products we sell and comply with notification requirements related to safety and efficacy, product supply, and other aspects of our products and operations.

The FDA may withdraw approval of a product if compliance with regulatory requirements and standards is not maintained or if problems occur after a product reaches the market, including as may be identified through market surveillance or third-party studies involving our products.

The FDA may also mandate labeling changes to products at any point in a product's life cycle based on new safety information or as part of a labeling change to a particular class of products.

The FDA may also mandate labeling changes, post-marketing studies, or risk management programs to products at any point in a product's life cycle based on new safety information or as part of a labeling change to a particular class of products.

In addition, the FDA strictly regulates marketing, labeling, advertising, and promotion of products to prescribers and patients.

Pharmaceutical products may be promoted only for approved indications and in accordance with the provisions of the approved label.

The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses.

The FDA and other agencies enforce the laws and regulations prohibiting the promotion of off-label uses.

Outside the U.S., our products and operations are subject to similar regulatory requirements, notably by the EMA in Europe, the Ministry of Health, Labor and Welfare in Japan, and the National Medical Products Administration in China.

Specific regulatory requirements vary from country to country.

Regulatory and compliance requirements, as well as approval processes outside the U.S., may differ from those in the U.S.

Regulatory and compliance requirements, as well as approval processes outside the U.S., differ from those in the U.S.

and may involve additional costs, uncertainties, and risks.

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We make substantial investments of capital and operating expenses to implement comprehensive, company-wide quality systems and controls in our manufacturing, product development, and process development operations in an effort to maintain sustained compliance with cGMP and other regulations.

Nonetheless, manufacturing quality and other aspects of pharmaceutical regulatory compliance is heavily scrutinized and results in government investigations, regulatory and legal actions, product recalls and seizures, fines and penalties, interruption of production leading to product shortages, import bans or denials of import certifications, delays or denials in new product approvals or line extensions or supplemental approvals of current products pending resolution of any issues, any of which have and could adversely affect our business and reputation.

Nonetheless, manufacturing quality and other aspects of pharmaceutical regulatory compliance is heavily scrutinized and results in government investigations, regulatory and legal actions, product recalls and seizures, fines and penalties, interruption of production leading to product shortages, import bans or denials of import certifications, delays or denials in new product approvals, line extensions or supplemental approvals of current products pending resolution of any issues, any of which have and could in the future adversely affect our business and reputation.

Certain of our products, devices and components are manufactured by third parties, and their failure to comply with these regulations has and could in the future adversely affect us, including through failure to supply product to us or delays in approvals of new products or indications.

For example, in 2023 we received complete response letters based on FDA observations made during inspections of manufacturing facilities rather than any issues related to efficacy or safety.

These resulted in certain delays in the approval of new products.

Any determination by the FDA or other regulatory authorities of manufacturing or other deficiencies could adversely affect our business and reputation.

For more information on product regulation challenges, see Item 1A, "Risk Factors—Risks Related to Our Operations—Reliance on third-party relationships and outsourcing arrangements could adversely affect our business."

Emergency Use Authorizations

The Secretary of Health and Human Services may issue an Emergency Use Authorization (EUA) to authorize unapproved medical products, or unapproved uses of approved medical products, to be manufactured, marketed, and sold in the context of an actual or potential emergency that has been designated by the government.

For example, certain of our products were previously made available for the treatment of COVID-19 under respective EUAs.

An EUA terminates when the emergency determination underlying the EUA terminates, and EUAs can be revoked under other circumstances, the timing of which may occur unexpectedly or be difficult to predict.

Outside the U.S., the emergency use of medical products is subject to regulatory processes and requirements that vary and differ from those in the U.S.

We rely on the FDA and other regulatory bodies for appropriate oversight, administration, and enforcement of our industry, anyone marketing or purporting to market medicines, and public health.

We have seen an increase in the production, marketing, and sale of counterfeit, misbranded, adulterated, and compounded incretins.

In the U.S., these activities include mass compounding based on asserted reliance on regulatory exceptions that permit limited compounding in certain circumstances by certain entities.

In contrast to the strict regulation of our facilities and manufacturing practices, these actors have experienced low barriers to entry and a lack of regulatory oversight and enforcement.

These practices may impact patient safety and undermine regulatory drug approval processes.

Other Laws and Regulations

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Department of Health and Human Services (HHS), the Federal Trade Commission, the Office of Personnel Management, and state attorneys general.

State, federal, and foreign governments, agencies, and other regulatory bodies are active in their oversight, enforcement activities, and coordination with respect to pharmaceutical companies, which has resulted in intensified scrutiny, litigation costs, corporate criminal sanctions, and substantial civil settlements in the pharmaceutical industry.

State, federal, and foreign governments, agencies, and other regulatory bodies are active in their oversight, enforcement activities, and coordination with

respect to pharmaceutical companies, which has resulted in intensified scrutiny, litigation costs, corporate criminal sanctions, and substantial civil settlements in the pharmaceutical industry.

Foreign Corrupt Practices Act of 1977 (FCPA) prohibits certain individuals and entities, including U.S.

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As noted above, our business is heavily regulated and therefore involves significant interaction with officials outside the U.S.

Additionally, in many countries outside the U.S., healthcare providers who prescribe pharmaceuticals are employed by the government and purchasers of pharmaceuticals are government entities;

Additionally, in many countries outside the U.S., healthcare providers who prescribe pharmaceuticals may be employed by the government and purchasers of pharmaceuticals are government entities;

therefore, our interactions with these prescribers and purchasers are subject to regulation under the FCPA.

In addition to the U.S.

application and enforcement of the FCPA, the various jurisdictions in which we operate and supply our products have laws and regulations aimed at preventing and penalizing corrupt and anticompetitive behavior.

In recent years, several jurisdictions have enhanced their laws and regulations in this area, increased their enforcement activities, and/or increased the level of cross-border coordination and information sharing.

We are, and could in the future become, subject to administrative and legal proceedings and actions, which could include claims for civil penalties (including treble damages), criminal sanctions, and administrative remedies, including exclusion from U.S.

federal and other healthcare programs.

Various other jurisdictions in which we operate and supply our products have laws and regulations aimed at preventing and penalizing corrupt and anticompetitive behavior.

It is possible that an adverse outcome in future actions could have a material adverse impact on our consolidated results of operations, liquidity, and financial position in any given period.

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In addition, U.S.

government actions to reduce federal spending on entitlement programs, including Medicare and Medicaid, may affect payment for our products or services associated with the provision of our products.

In August 2022, the U.S.

government actions to reduce federal spending on entitlement programs, including Medicare and Medicaid, affects payment for our products or services associated with the provision of our products.

In 2022, the U.S.

government enacted the Inflation Reduction Act of 2022 (IRA).

Among other measures, the IRA requires HHS to effectively set prices for certain single-source drugs and biologics reimbursed under Medicare Part B and Part D.

Generally, these government prices apply nine years (for medicines approved under an NDA) or thirteen years (for medicines approved under a Biologics License Application (BLA)) following initial FDA approval and will be set at a price that is likely to represent a significant discount from existing average prices to wholesalers and direct purchasers.

While the law specifies a ceiling price, it does not set a minimum or floor price.

Among other measures, the IRA requires the HHS to effectively set prices for certain single-source drugs and biologics reimbursed under Medicare Part B and Part D.

Generally, these government prices apply beginning at nine years (for medicines approved under a New Drug Application) or thirteen years (for medicines approved under a Biologics License Application) following FDA approval or licensure for the molecule and are set at a price that generally represents a significant discount from existing prices to wholesalers and direct purchasers.

While the law specifies a maximum price that HHS can set, it does not set a minimum price.

The Medicare price HHS determines may impact the product’s best price determination under the Medicaid Drug Rebate Program and the 340B Drug Pricing Program, potentially leading to a negative impact on both Medicaid and 340B prices.

In August 2023, HHS selected Jardiance, which is part of our collaboration with Boehringer Ingelheim, as one of the first ten medicines subject to government-set prices effective in 2026.

In August 2024, HHS announced the government-set prices for these medicines with Jardiance subject to a 66% discount compared to the 2023 U.S.

calendar year list price for a 30-day supply and discounts for the other nine medicines ranging from approximately 38% to 79% below list price.

Given our product portfolio, we expect additional significant products will be selected in future years, which would have the effect of accelerating revenue erosion prior to expiry of exclusivities.

The effect of reducing prices and reimbursement for certain of our products would significantly impact our business and consolidated results of operations.

The effect of reducing prices and reimbursement for certain of our products could significantly impact our business and consolidated results of operations.

Other IRA provisions require drug manufacturers to provide rebates for Medicare Part B and Part D medicines under certain circumstances.

Also, the Part D benefit redesign will replace the Part D Coverage Gap Discount Program (CGDP) with a new manufacturer discount program.

Beginning in January 2025, the 70 percent CGDP discount will be replaced by a 10 percent manufacturer discount for all Medicare Part D beneficiaries that have met their deductible and incurred out of pocket drug costs below a $2,000 threshold and a 20 percent discount for beneficiaries that have incurred out of pocket drug costs above the $2,000 threshold under the Part D benefit redesign.

Also, on January 1, 2025 the Part D benefit redesign replaced the Part D Coverage Gap Discount Program (CGDP) with the new Manufacturer Discount Program (MDP).

The 70 percent CGDP discount was replaced by a 10 percent MDP discount for all Medicare Part D beneficiaries that have met their deductible and incurred out of pocket drug costs below a $2,000 threshold and a 20 percent MDP discount for beneficiaries that have incurred out of pocket drug costs above the $2,000 threshold under the new Part D benefit redesign.

Manufacturers that fail to comply with the IRA may be subject to various penalties, including civil monetary penalties, which could be significant.

The IRA has and will meaningfully influence our business strategies and those of our competitors.

In particular, the nine-year timeline to set prices for medicines approved under an NDA reduces the attractiveness of investment in small molecule innovation.

The IRA has, and will continue to, meaningfully influence our business strategies and those of our competitors.

In particular, the nine-year timeline to set prices for medicines approved under a New Drug Application reduces the attractiveness of investment in small molecule innovation.

The IRA can cause changes to development approach and timing and investments at-risk.

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Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, require advance notice of list price increases, establish upper payment limits or other restrictions by drug affordability review boards, allow the importation of drugs from other countries, address pharmacy benefit manager practices, and reform government program reimbursement methodologies for drug products.

Pharmacy benefit manager reform could be pursued or enacted in 2025.

Restrictive or unfavorable pricing, coverage, or reimbursement determinations for our medicines or product candidates by governments, regulatory agencies, courts, or private payers could also adversely impact our business and financial results.

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In the U.S., we are required to provide rebates to the federal government and state governments on their purchases of our pharmaceuticals under various federal and state healthcare programs, including state Medicaid and Medicaid Managed Care programs (a minimum of 23.1 percent plus adjustments for price increases above the consumer price index over time) and discounts to private entities who treat patients in certain types of healthcare facilities intended to serve low-income and uninsured patients (known as 340B covered entities).

Additionally, an annual fee is imposed on pharmaceutical manufacturers and importers that sell branded prescription drugs to specified government programs.

Additionally, an annual fee is imposed on pharmaceutical manufacturers and importers that sell branded prescription drugs to specified government programs, such as Medicare Part B and Part D, and Medicaid.

Changes to the 340B program or the Medicaid programs could have a material adverse impact on our business.

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(i) covered entities and their child sites;

(ii) contract pharmacies wholly owned by the covered entity;

or (iii) if a covered entity lacks an in-house outpatient pharmacy, a single contract pharmacy designated by a covered entity to establish a 340B bill to/ship to arrangement.

or (ii) if a covered entity lacks an in-house outpatient pharmacy, a single contract pharmacy designated by a covered entity to establish a 340B bill to/ship to arrangement.

Claims-level data is ordinarily required for any contract pharmacy.

Our Contract Pharmacy Limited Distribution System contains certain exceptions that permit broader contract pharmacy usage, including for "penny priced" insulin products, provided that the covered entity passes through all discounts to eligible patients at the point of sale and meets other conditions.

We believe our Contract Pharmacy Limited Distribution System complies with the 340B statute, but it remains subject to ongoing inquiries and litigation that could have a material impact on our business, as discussed in Item 8, "Financial Statements and Supplementary Data—Note 16:

Contingencies." Other aspects of the 340B program, including the proper definitions of "patient" and "child site" under the 340B statute, are also subject to ongoing litigation by other parties, the resolution of which could impact the growth and scope of the 340B program.

Contingencies." Other aspects of the 340B program, including the manner in which manufacturers can offer 340B pricing, and proper definitions of "patient" and "child site" under the 340B statute, are also subject to ongoing litigation by Lilly and/or other parties, the resolution of which could impact the growth and scope of the 340B program.

For example, on November 14, 2024, Lilly sued the Health Resources and Services Administration (HRSA) over its purported rejection of Lilly’s plan to implement a cash replenishment model to make 340B pricing available to 340B covered entities, in place of the current product replenishment model.

Rebates are also negotiated in the private sector.

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These rebates are affected by the introduction of competitive products and generics in the same class.

Our approach to the rebates we offer to private payers that provide prescription drug benefits to seniors covered by Medicare may be impacted by the 2020 regulatory amendments to the anti-kickback statute's discount safe harbor, which have been stayed until at least January 1, 2032.

For a discussion of risks related to how we price our products, see Item 1A, "Risk Factors—Risks Related to Our Business—We face litigation and investigations related to our products, how we price or commercialize our products, and other aspects of our business, which could adversely affect our business, and we are self-insured for such matters."

For a discussion of risks related to how we price our products, see Item 1A, "Risk Factors—Risks Related to Our Business—We are party to litigation and investigations related to our products, how we price or commercialize our products, and other aspects of our business, which could adversely affect our business, and we are self-insured for such matters."

Outside the U.S.

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In addition, third-party organizations, including professional associations, academic institutions, and non-profit entities associated with payers, conduct and publish comparative effectiveness and cost/benefit analyses on medicines, the impact of which can influence pharmaceutical access and pricing.

In most international markets, we operate in an environment of government-mandated cost-containment programs, which may include price controls, international reference pricing (to other countries' prices), discounts and rebates, therapeutic reference pricing (to other, often generic, pharmaceutical choices), regulatory hurdles, restrictions on physician prescription levels, and mandatory generic substitution.

In most international markets, we operate in an environment of government-mandated cost-containment programs, which may include price controls, international reference pricing, discounts and rebates, therapeutic reference pricing (to other, often generic, pharmaceutical choices), health technology assessments, regulatory hurdles, restrictions on physician prescription levels, and mandatory generic substitution.

In these markets, healthcare services and the determination of pricing and reimbursement for pharmaceutical products are impacted by government control at the point of care or as the primary payer.

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Member states also have the power to restrict the range of pharmaceutical products for which their national health insurance systems provide reimbursement and may condition access on agreement of a reimbursement price or completion of cost-effectiveness or other gating studies.

In Japan, our products generally are subject to government-mandated annual price reductions.

In Japan, our products can be subject to government-mandated annual price reductions.

The government may also order re-pricings for specific products or classes of products if certain criteria are met, including exceeding product use thresholds.

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China also utilizes a value-based procurement program process for products that have generic substitutes.

Products that we choose to tender through this process are similarly subject to price reductions.

Our performance in China may be significantly impacted by the country's evolving pharmaceutical regulatory environment, including access, intellectual property protection, regulatory enforcement and compliance, and trade policies.

As a general matter, products that we choose to tender through this process are similarly subject to price reductions.

Our business in China may be significantly impacted by the country's evolving pharmaceutical regulatory environment, including access, intellectual property protection, regulatory enforcement and compliance, and trade policies.

Governments in many emerging markets are also focused on limiting health care costs and have enacted price controls and measures impacting intellectual property.

Reforms in our product markets, including those that may stem from periods of uneven economic growth or downturns or uncertainty, or as a result of high inflation, emergence, or escalation of, and responses to, international tension and conflicts, or government budgeting priorities, may continue to result in added pressure on pricing and reimbursement for our products.

We cannot predict the extent to which our business may be affected by current or potential future legislative, regulatory, or payer developments.

However, in general we expect to see continued focus on regulating pricing, resulting in additional state, federal, and international legislative and regulatory developments that could have further negative effects on pricing and reimbursement for our products as well as overall operations.

See Item 7, "Management's Discussion and Analysis—Executive Overview—Other Matters—Trends Affecting Pharmaceutical Pricing, Reimbursement, and Access" for additional information regarding recent legislative, administrative, and other pricing initiatives and their impact on our results.

However, in general we expect to see continued focus on regulating pricing, resulting in additional state, federal, and international legislative and regulatory developments that could have further negative effects on pricing, access, and reimbursement for our products as well as overall operations.

See Item 7, "Management's Discussion and Analysis—Executive Overview—Other Matters—Trends Affecting Pharmaceutical Pricing, Reimbursement, and Access and Certain Other Regulatory Developments," for additional information regarding recent legislative, administrative, and other pricing initiatives and their impact on our results.

Research and Development

Our commitment to research and development dates back more than 140 years.

Our commitment to research and development dates back nearly 150 years.

We invest heavily in research and development because we believe it is critical to our long-term competitiveness.

At the end of 2024, we employed approximately 11,000 people in pharmaceutical research and development activities, including a substantial number of physicians, scientists holding graduate or postgraduate degrees, and highly skilled technical personnel.

Our internal pharmaceutical research focuses primarily on the areas of metabolism (including diabetes, obesity and cardiovascular), immunology, neuroscience, and oncology.

Our internal pharmaceutical research focuses primarily on the areas of immunology, metabolism (including diabetes, obesity and cardiovascular), neuroscience, and oncology.

In addition to discovering and developing new medicines, we seek to expand the value of existing products through new uses, formulations, and therapeutic approaches, including complementary delivery devices or diagnostic tools, that can provide additional value to patients.

To supplement our internal efforts, we collaborate with others, including academic institutions and research-based pharmaceutical and biotechnology companies.

We use the services of physicians, hospitals, medical schools, and other research organizations worldwide to conduct clinical trials to establish the safety and effectiveness of our medicines.

We use the services of physicians, hospitals, medical schools, and other organizations worldwide to conduct clinical trials to establish the safety and effectiveness of our medicines.

We also invest in external research and technologies that we believe complement and strengthen our own efforts.

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• Discovery Phase

In the discovery phase, scientists identify, design, and synthesize promising candidates by analyzing their effect on biological targets thought to play a role in disease.

Targets are often unproven and only candidates that have the desired effect on the target and meet other design criteria move to the next phase of development, which includes the initiation of studies in animals to support regulatory and safety requirements for clinical research in humans.

In the discovery phase, scientists identify, design, and synthesize promising candidates by analyzing their effect on biological targets considered to play a role in disease.

Targets are often unproven and only candidates that are expected to have the desired effect on the target and meet other design criteria move to the next phase of development, which includes the initiation of studies in animals to support regulatory and safety requirements for clinical research in humans.

The discovery phase can take years and the probability of any one candidate becoming a medicine is extremely low.

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Safety testing is initially performed in laboratory tests and animals, as necessary.

In general, the first human tests (often referred to as Phase I) are conducted in small groups of subjects to assess safety and evaluate the potential dosing range.

Subsequently, larger populations of patients are studied (Phase II) to identify signs of efficacy while continuing to assess safety.

In general, the first human tests (often referred to as Phase 1) are conducted in small groups of subjects to assess safety and evaluate the potential dosing range.

Subsequently, larger populations of patients are studied (Phase 2) to identify signs of efficacy while continuing to assess safety.

In parallel, scientists work to identify safe, effective, and economical manufacturing processes.

Long-term animal studies continue to test for potential safety issues.

Of the candidates that enter the early development phase, approximately 10 percent move to the late development phase.

Long-term animal studies may continue to test for potential safety issues.

Of the candidates that enter the early development phase, only a fraction move to the late development phase.

The early development phase varies but can take several years to complete.

• Late Development Phase

Late phase development projects (typically Phase III) have met initial safety requirements and shown initial evidence of efficacy in earlier studies.

As a result, these candidates generally have a higher likelihood of success and trials include larger patient populations to demonstrate safety and efficacy in the disease.

Late phase development projects (typically Phase 3) have met initial safety requirements and shown initial evidence of efficacy in earlier studies.

As a result, these candidates generally have a higher likelihood of success and trials include larger patient populations to demonstrate safety and efficacy of the candidate in treating the disease.

These studies are designed to demonstrate the benefit and risk of the potential new medicine and may be compared to competitive therapies, placebo, or both.

Phase III studies are generally conducted globally, are costly, and are designed to support regulatory filings for marketing approval.

The duration of Phase III testing varies by disease and may take years.

Phase 3 studies are generally conducted globally, are costly, and are designed to support regulatory filings for marketing approval.

The duration of Phase 3 testing varies by disease and may take years.

• Submission Phase

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There is no guarantee that a potential medicine will receive marketing approval, or that decisions on marketing approvals or indications will be consistent across geographic areas.

See Item 7, "Management's Discussion and Analysis—Executive Overview—Late-Stage Pipeline," for more information on our late-stage product candidates.

See Item 7, "Management's Discussion and Analysis—Executive Overview—Clinical Development Pipeline," for more details about our current product pipeline.

Raw Materials and Product Supply

Most of the principal materials we use in our manufacturing operations are available from more than one source.

However, certain raw or intermediate materials are procured from a single source.

However, certain materials are procured from a single source.

We seek to maintain sufficient inventory to provide reliability of production and manage unforeseen supply variability.

However, various developments have led, and may in the future lead, to interruption or shortages in supply until we establish new sources, implement alternative processes, bring new manufacturing facilities online, or pause or discontinue product sales in one or more markets.

The majority of our revenue comes from products produced predominantly in our own facilities.

Our principal active ingredient manufacturing occurs at sites we own in the U.S., including Puerto Rico, and Ireland.

Finishing operations, including formulation, filling, assembling, delivery device manufacturing, and packaging, take place at a number of sites throughout the world.

Our active ingredient manufacturing and finishing operations, including formulation, filling, assembling, delivery device manufacturing, and packaging, take place at sites in the U.S., including Puerto Rico, Ireland and a number of other sites throughout the world.

To support anticipated demand for our current and prospective products, we have undertaken significant manufacturing expansion initiatives.

During 2023, commercial production commenced at our Research Triangle Park manufacturing site in Durham, North Carolina.

Further investments to increase our manufacturing capacity include planned sites in Concord, North Carolina, Limerick, Ireland, Alzey, Rhineland-Palatinate, Germany, and two in Lebanon, Indiana.

Investments to increase our manufacturing capacity include sites in North Carolina, Wisconsin, Ireland, Germany, and two in Indiana.

We also utilize and are expanding arrangements with third parties for certain active ingredient manufacturing, filling, finishing operations, and for device or component production and assembly.

Among these third parties, we, and the pharmaceutical industry generally, depend on China-based suppliers for portions of our supply chain.

federal lawmakers are considering legislation that is intended to limit supply chain reliance on China, including the proposed BIOSECURE Act.

In addition, historically, geopolitical tensions between the U.S.

and China have led to the imposition of tariffs, sanctions, and certain other business restrictions between the U.S.

In February 2025, the U.S.

presidential administration imposed new tariffs on China and China responded with tariffs on select U.S.

If new legislation or additional trade restrictions are adopted or geopolitical tensions were to increase and disrupt our operations in, or related to, China, such disruption could significantly impact our business and results of operations.

See Item 1A, "Risk Factors—Risks Related to Our Operations—Reliance on third-party relationships and outsourcing arrangements could adversely affect our business" and "Risk Factors—Risks Related to Doing Business Internationally—Uneven economic growth or downturns or international trade and other global disruptions, geopolitical tensions, or disputes could adversely affect our business and operating results," for additional information.

We manage our supply chain (including our own facilities, contracted arrangements, and inventory) in a way that is intended to allow us to meet product demand while maintaining flexibility to reallocate manufacturing capacity to improve efficiency and respond to changes in supply and demand.

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Shifting or adding manufacturing capacity is a very lengthy process requiring significant capital expenditures, process modifications, and regulatory approvals.

Accordingly, developments such as unanticipated demand, unplanned plant shutdowns, manufacturing or quality assurance difficulties at one of our facilities or contracted facilities, failure or refusal of a supplier or contract manufacturer to supply contracted quantities, increases in demand on a supplier, or difficulties in predicting or variability in demand for our products and those of our competitors have led, and may in the future lead, to interruption or higher costs in the supply of certain products, product shortages, or pauses or discontinuations of product sales in one or more markets.

For example, we have experienced challenges in meeting strong demand for our incretin products in recent periods, partially due to the limited availability of competitor therapies, and expect tight supply to persist while additional manufacturing capacity is operationalized.

Further, cost and wage inflation, availability of adequate capacity in global transportation, supply chain complexities, including consolidation therein, labor market issues, international tension and conflicts, uneven economic growth or downturns, an increase in overall demand in our industry for certain products and materials, and public health outbreaks, epidemics, or pandemics, such as the COVID-19 pandemic, have caused, and in the future may cause, delays or disruptions in and/or increased costs related to distribution of our medicines, the construction or acquisition of manufacturing capacity, procurement activity, and supplier or contract manufacturer arrangements, as well as other general business impacts.

Accordingly, developments such as unanticipated demand, unplanned plant shutdowns, manufacturing or quality assurance difficulties at one of our facilities or contracted facilities, failure or refusal of a supplier or contract manufacturer to supply contracted quantities in a timely manner or at all, increases in demand on a supplier, or difficulties in predicting or variability in demand for and supply of our products and those of our competitors have led, and may in the future lead, to interruption or higher costs in the supply of certain products, product shortages, or pauses or discontinuations of product sales in one or more markets.

For example, in periods of 2024, demand for our incretin medicines exceeded production.

Supply and channel dynamics in some cases also contribute to variability in financial results for our products from period to period.

Further, cost and wage inflation, availability of adequate capacity in global transportation, supply chain complexities, including consolidation therein, labor market issues, international tension and conflicts, uneven economic growth or downturns, an increase in overall demand in our industry for certain products and materials, and public health outbreaks, epidemics, or pandemics, have caused, and in the future may cause, delays or disruptions in and/or increased costs related to distribution of our medicines, the construction or acquisition of manufacturing capacity, procurement activity, and supplier or contract manufacturer arrangements, as well as other general business impacts.

For more information on the additional risks we face in connection with any difficulties, disruptions, and shortages in the manufacturing, distribution, and sale of our products, see Item 1A, "Risk Factors—Risks Related to Our Business—Manufacturing, quality, or supply chain difficulties, disruptions, or shortages could lead to product supply problems."

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We perform tests at various stages of production processes and on the final product in an effort to ensure that the product meets all applicable regulatory requirements and our internal standards.

Additional testing for stability over the life of the product is also performed.

These tests may involve chemical and physical chemical analyses, microbiological testing, testing in animals, or a combination thereof.

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Ricks has 28 years of service with Lilly.

Anat Ashkenazi 51 Executive Vice President and Chief Financial Officer (since 2021).

Previously, Ms.

Ashkenazi held various leadership roles with Lilly, including senior vice president, controller and chief financial officer, Lilly Research Laboratories, and vice president, finance and chief financial officer, Lilly Diabetes and Lilly global manufacturing and quality.

Ashkenazi has 22 years of service with Lilly.

Eric Dozier 57 Executive Vice President, Human Resources and Diversity (since 2022).

Eric Dozier 58 Executive Vice President, Chief People Officer (since 2022).

Previously, Mr.

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Prior to joining WellCare, she served as divisional vice president and associate general counsel of intellectual property litigation at Abbott Laboratories from 2010 to 2013 and divisional vice president and associate general counsel of litigation from 2013 to 2016.

Hakim has four years of service with Lilly.

Hakim has five years of service with Lilly.

Edgardo Hernandez 50 Executive Vice President and President, Manufacturing Operations (since 2021).

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Hernandez has 20 years of service with Lilly.

Patrik Jonsson 57 Executive Vice President and President, Lilly Diabetes and Obesity and President, Lilly USA (since 2024).

Patrik Jonsson 58 Executive Vice President and President, Lilly Cardiometabolic Health and President, Lilly USA (since 2024).

Jonsson has held various leadership roles with Lilly, including, most recently, as Executive Vice President and President, Lilly Immunology and Lilly USA, and Chief Customer Officer.

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Jonsson has 34 years of service with Lilly.

Johna Norton 57 Executive Vice President, Global Quality (since 2017).

Previously, Ms.

Norton held various leadership roles with Lilly, including vice president, global quality assurance API manufacturing and product research and development.

Norton has 33 years of service with Lilly.

Lucas Montarce 47 Executive Vice President and Chief Financial Officer (since 2024).

Most recently, Mr.

Montarce served as the president and general manager of Lilly’s Spain, Portugal, and Greece hub, a position he assumed in 2024.

Previously Mr.

Montarce was group vice president, controller and chief financial officer of Lilly Research Laboratories, vice president, finance and chief financial officer, Lilly International, and vice president, finance and global chief financial officer, Elanco Health.

Montarce has 23 years of service with Lilly.

Diogo Rau 50 Executive Vice President and Chief Information and Digital Officer (since 2021).

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Prior to his tenure at Apple, he served as a partner at McKinsey & Company.

Rau has three years of service with Lilly.

Rau has four years of service with Lilly.

Melissa Seymour 55 Executive Vice President, Global Quality (since 2024).

Prior to joining Lilly, Ms.

Seymour was the chief quality officer for Bristol Myers Squibb from 2022 to 2024.

Before joining Bristol Myers Squibb, Ms.

Seymour was also the chief quality officer at Biogen.

Seymour has one year of service with Lilly.

Daniel Skovronsky, M.D., Ph.D.

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Skovronsky has 14 years of service with Lilly.

Jacob Van Naarden 39 Executive Vice President and President, Loxo@Lilly (since 2021).

Jacob Van Naarden 40 Executive Vice President and President, Lilly Oncology (since 2021).

Previously, Mr.

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Van Naarden worked in various biotechnology investing, operating, and advisory capacities, including positions with HealthCor Management, Aisling Capital, and Goldman Sachs.

Van Naarden has five years of service with Lilly.

Alonzo Weems 53 Executive Vice President, Enterprise Risk Management, and Chief Ethics and Compliance Officer (since 2021).

Previously, Mr.

Weems held various leadership roles with Lilly, including vice president and deputy general counsel for corporate legal functions, general counsel for Lilly USA, and general counsel for biomedicines and diabetes.

Weems has 26 years of service with Lilly.

Van Naarden has six years of service with Lilly.

Anne White 56 Executive Vice President and President, Lilly Neuroscience (since 2021).

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Yuffa held various leadership roles with Lilly, including senior vice president and president, Lilly Bio-Medicines, vice president of U.S.

Diabetes, general manager of Italy Hub, and vice president, global ethics and compliance officer since 2014.

Diabetes, general manager of Italy Hub, and vice president, global ethics and compliance officer.

Yuffa has 28 years of service with Lilly.

Human Capital Management

Our core values—integrity, excellence, and respect for people—shape our approach to attracting, retaining, engaging, and developing a diverse and highly skilled and ethical workforce, which is critical to executing our strategy.

We believe the strength of our workforce significantly contributes to our financial performance and enables us to make life better for people around the world.

For instance, most of the products we sell today were discovered or developed by our own scientists, and our long-term success depends on our ability to continually discover or acquire, develop, and commercialize innovative medicines.

Our core values—integrity, excellence, and respect for people—shape our approach to attracting, retaining, engaging, and developing a diverse and highly skilled and ethical workforce.

Our long-term success depends on our ability to continually discover or acquire, develop, and commercialize innovative medicines.

We believe that fostering a positive culture that values the contributions of our talented colleagues helps drive our success.

We are committed to creating a safe, supportive, ethical, and rewarding work environment through strategic focus on our human capital management process, fairness and nondiscrimination in our employment practices, robust training and development opportunities, and competitive pay and benefits.

We believe our dedication to promoting diversity, equity, and inclusion within our company reflects our values and is a key driver of business success and growth.

We are committed to creating a safe, supportive, ethical, and rewarding work environment through intentional focus on our human capital management process, fairness and nondiscrimination in our employment practices, robust training and development opportunities, and competitive pay and benefits.

We believe our dedication to promoting inclusion within our company makes Lilly a stronger and more innovative company.

At all times, we seek to hire the most qualified candidate for each open position.

We regularly conduct confidential employee surveys to seek feedback from our workforce on a variety of topics.

These results are reviewed and analyzed by our leaders to identify opportunities to adjust our policies and benefits to improve our employees' experience.

As a result of our efforts, we believe that we have a highly performing, cohesive workforce and that our employee relations are good.

These results are reviewed and analyzed by our leaders to identify opportunities to adjust our practices and benefits to improve our employees' experience.

As a result of our efforts, we believe that we have a high performing, cohesive workforce and that our employee relations are good.

At the end of 2024, we employed approximately 47,000 people, including approximately 25,000 employees outside the U.S.

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We are committed to fairness and nondiscrimination in our employment practices, and we deeply value diverse backgrounds, skills, and global perspectives.

Because dedication to human capital management is also a core component of our corporate governance, our board of directors regularly engages with management and facilitates a system of reporting designed to monitor human capital management initiatives and progress as part of the overarching framework that guides how we attract, retain, engage, and develop a workforce that aligns with our values and mission.

Across all levels of our workforce, from the end of 2019 through the end of 2023, we have seen positive changes in representation for minority group members (MGM) in the United States and women globally.

In addition, 4 of 13 current members (approximately 31 percent) of our executive committee (which includes our CEO) are women and 3 are MGMs.

In addition, as of the filing of this Annual Report on Form 10-K, the company's 12-member board of directors includes five women and five members who are MGMs.

Our recruitment strategy focuses on opportunities to expand our pool of candidates to reach more candidates across a variety of dimensions, including but not limited to race, religion, sexual orientation, gender identity, national origin, veteran status, disability status, education, and experience.

We also strive to provide a diverse panel of interviewers for open positions.

We believe that recruiting in this way helps ensure that everyone will have an equal opportunity to advance their careers.

We offer training to enable our employees to perform their duties in our highly regulated industry.

We also strive to cultivate a culture that promotes ongoing learning by encouraging employees to seek further education and growth experiences, helping them build rewarding careers.

We have implemented development tools and resources for all employees, improved our talent programs and processes to provide broader access to information, and increased transparency regarding career development and advancement at Lilly.

Because dedication to human capital management is also a core component of our corporate governance, our board of directors regularly engages with management to monitor human capital management initiatives and progress as part of the overarching framework that guides how we attract, retain, engage, and develop a workforce that aligns with our values and mission.

Employee Health and Safety

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Accordingly, investors should monitor the “Investors” section of our website, in addition to following our press releases, filings with the SEC, public conference calls, presentations, and webcasts.

We may also use social media channels to communicate with investors and the public about our business, products and other matters, and those communications could be deemed to be material information.

The information contained on, or that may be accessed through, our website or social media channels, is not incorporated by reference into, and is not a part of, this Annual Report on Form 10-K.

We and our executive officers may also use social media channels to communicate with investors and the public about our business, products and other matters, and those communications could be deemed to be material information.

The information contained on, or that may be accessed through, our website or our or our executive officers' social media channels, is not incorporated by reference into, and is not a part of, this Annual Report on Form 10-K.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business