What changed in this filing

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Item 1. Business

2026-02-12 compared with 2025-02-19 · 194 added, 158 removed, 442 unchanged (44% of the section changed)

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and as monotherapy, in combination with chemotherapy, or in combination with radiation therapy for the treatment of certain types of head and neck cancers.

For the treatment of adult patients with relapsed or refractory mantle cell lymphoma (MCL) after at least two lines of systemic therapy, including a BTK inhibitor;

and for the treatment of adult patients with chronic lymphocytic leukemia or small lymphocytic lymphoma who have received at least two prior lines of therapy, including a BTK inhibitor and a BCL-2 inhibitor.

Inluriyo For the treatment of adults with ER-positive HER2-negative, ESR1-mutated advanced or metastatic breast cancer whose disease progressed after at least one line of endocrine therapy.

For the treatment of adult patients with relapsed or refractory chronic lymphocytic leukemia or small lymphocytic lymphoma (CLL/SLL) who have previously been treated with a covalent BTK inhibitor;

and for the treatment of adult patients with relapsed or refractory mantle cell lymphoma (MCL) after at least two lines of systemic therapy, including a BTK inhibitor.

For the treatment of metastatic NSCLC with a rearranged during transfection (RET) gene fusion in adult patients;

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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 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.

The products we market and their distribution vary from country to country depending on the market and applicable regulations.

As applicable, we educate healthcare providers about our products in various ways, including via promotion in online and other channels, distributing information 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.

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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.

We enter into arrangements with these organizations to provide discounts or rebates on our products.

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

Our arrangements with these organizations often include discounts or rebates on our products.

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

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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.

In certain jurisdictions, we utilize LillyDirect, our direct-to-patient digital health care platform, to provide delivery of select Lilly medicines dispensed by third-party pharmacies to patients.

Tools to help patients access care from independent healthcare providers and programs to assist patients in adhering to treatment plans are also available on the platform where applicable.

Sales through LillyDirect represented a growing portion of our business in 2025 and we have launched, and continue to explore, new partnerships and tools, including through LillyDirect, to further expand access to our medicines.

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

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.

The products we market and their distribution vary from country to country.

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 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., we promote our products to healthcare providers through sales representatives and other channels.

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

Marketing Collaborations

We provide disease-state information directly to consumers via websites, social channels, and local activations.

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 Jardiance, Glyxambi, Synjardy, and Trijardy XR.

For additional information, see Item 8, "Financial Statements and Supplementary Data—Note 3:

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

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

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

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

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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.

For example, in the U.S.

self-insured employers must generally opt in for coverage of anti-obesity medicines.

Payers in various international markets also do not cover anti-obesity medicines for weight loss.

Our anti-obesity medicines comprise a significant portion of our revenues, and barriers to reimbursable patient access 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.

We believe our long-term competitive success depends on discovering and developing or acquiring and further developing 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 and global environment.

We face intensifying competition worldwide, including from China and other markets that have significantly expanded and accelerated research and development capabilities.

Companies in these markets are increasingly licensing products to multinational pharmaceutical companies, entering into strategic partnerships, and competing directly in major markets.

Our ability to compete effectively depends on our capacity to innovate at the pace of global scientific advancement, to access innovation through strategic partnerships and licensing arrangements across geographies, and to efficiently bring differentiated products to market.

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.

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Private Sector Dynamics."

Generic Pharmaceuticals, Biosimilars, and Compounding

Generic Pharmaceuticals and Biosimilars

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In most major jurisdictions, the regulatory approval process for pharmaceuticals (other than biological products (biologics)) exempts generics from costly and time-consuming clinical trials to demonstrate their safety and efficacy, allowing generic manufacturers to rely on the safety and efficacy of the innovator product.

As a result, generic manufacturers generally invest far fewer resources than we do for our branded products in research and development and can price their products significantly lower than our branded products.

As a result, generic manufacturers generally invest far fewer resources in research and development than we do for our branded products and can price their products significantly lower than branded products.

Accordingly, when a branded non-biologic pharmaceutical loses its market exclusivity, it normally faces intense price competition from generic forms of the product, which can result in the loss of a significant portion of the branded product's revenue in a very short period of time.

Loss of market exclusivity for competitive products may also shift market conditions for other branded products in the same therapeutic class.

Moreover, governments in some countries leverage generic entrants to drive price concessions through the utilization of volume-based procurement bidding and other measures.

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

Regulatory interpretation of important aspects of the laws regulating biosimilars continues to evolve, and therefore the impact of these laws on our business remains subject to substantial uncertainty.

For example, the extent to which a biosimilar, once approved, will be substituted for the innovator biologic in a way that is similar to traditional generic substitution for non-biologic products will depend on a number of regulatory and marketplace factors that are still developing.

Biosimilars may present both competitive challenges and opportunities.

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.

Regulatory interpretation of important aspects of the laws regulating biosimilars continues to evolve.

In the U.S., for example, the U.S.

Food and Drug Administration (FDA) has proposed changes in policy that could streamline the process of, and accelerate the timeline for, biosimilar development, including potentially minimizing the requirement for comparative clinical efficacy studies.

The impact of these laws and guidance on our business remains subject to substantial uncertainty.

We continue to see the production, marketing, and sale of counterfeit, misbranded, adulterated, and mass-compounded incretins in the U.S.

and other markets.

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.

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

Private Sector Dynamics

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

private sector, consolidated and integrated healthcare organizations significantly affect the competitive marketplace for pharmaceuticals.

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.

Formulary placement can lead to reduced usage of a product for the relevant patient population due to coverage restrictions, such as prior authorizations and formulary exclusions, or due to reimbursement limitations that result in higher consumer out-of-pocket cost, such as non-preferred co-pay tiers, increased co-insurance levels, and higher deductibles.

Unfavorable formulary placement can lead to reduced usage of a product for the relevant patient population due to coverage restrictions, such as prior authorizations and formulary exclusions, or due to reimbursement limitations that result in higher consumer out-of-pocket cost, such as non-preferred co-pay tiers, increased co-insurance levels, and higher deductibles.

Consequently, pharmaceutical companies face increased pressure in negotiations, and compete fiercely for formulary placement, not only on the basis of product attributes such as efficacy, safety profile, or patient ease of use, but also by providing rebates or other concessions.

As payers and pharmaceutical companies continue to negotiate formulary placement and rebates, value-based agreements, where rebates may be based on achievement (or not) of specified outcomes, are another increasingly prevalent tool.

Rebates and net cost are increasingly important factors in formulary decisions, particularly in treatment areas in which the payer has taken the position that multiple branded products are therapeutically comparable.

Rebates and net cost are important factors in formulary decisions, particularly in treatment areas in which the payer has taken the position that multiple branded products are therapeutically comparable.

These pressures have negatively affected, and could continue to negatively affect, our consolidated results of operations.

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Supply chain entities have also increasingly imposed utilization management tools to favor the use of generic products or otherwise limit access to our products.

In response to these issues, we are developing and deploying alternative product access strategies, including through direct-to-patient channels (such as LillyDirect) and direct-to-employer channels.

These strategies may not adequately mitigate unfavorable private sector dynamics.

For additional information on pricing and reimbursement for our pharmaceutical products, see "—Regulations and Private Payer Actions Affecting Pharmaceutical Pricing, Reimbursement, and Access—U.S."

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Intellectual property protection is critical to our ability to successfully commercialize our life sciences innovations and invest in the search for new medicines and uses.

Loss of effective patent protection for pharmaceuticals, especially for non-biologic products, typically results in the loss of effective market exclusivity for the product, often leading to a severe and rapid decline in revenues for the product.

Loss of effective patent protection for pharmaceuticals can result in the loss of effective market exclusivity for the product, often leading to a severe and rapid decline in revenues for the product.

We own, have applied for, or are licensed under, a large number of patents in the U.S.

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Patent and Trademark Office (USPTO).

• Patent term restoration for a single patent for a pharmaceutical product is provided to U.S.

patent holders to compensate for a portion of the time invested in clinical trials and the U.S.

Food and Drug Administration (FDA) review process.

• Patent term extension for a single patent for a pharmaceutical product is provided to U.S.

patent holders to compensate for a portion of the time invested in clinical trials and the 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 initial FDA approval.

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For example, Supplementary Protection Certificates are available to extend the life of a European patent up to an additional five years (subject to a 15-year cap from European Medicines Agency (EMA) approval) and in Japan patent terms can be extended up to five years.

In some cases, the innovator company may retain exclusivity despite approval of the generic, biosimilar, or other follow-on versions of a new medicine beyond the expiration of the compound patent through market dynamics and challenges, later-expiring patents on manufacturing processes, methods of use or formulations, or data protection that may be available under pharmaceutical regulatory laws.

In some cases, the innovator company may retain exclusivity despite approval of the generic, biosimilar, or other follow-on versions of a new medicine beyond the expiration of the compound patent through market dynamics and challenges, later-expiring patents on, for example, manufacturing processes, methods of use or formulations, or data protection that may be available under pharmaceutical regulatory laws.

The primary forms of data protection are as follows:

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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.

An agreement-in-principle, announced in December 2025 between the European Commission, Council, and Parliament, would set a base level of 8 years of data protection, with additional incentives conditional on certain requirements, while overall reducing the maximum protection available by one year.

• 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, pediatric exclusivity is also added 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 end of any other unexpired exclusivity and, for products other than biologics, to the end of certain unexpired patents.

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

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Further, many developing countries, and some developed countries, do not provide effective data package protection even though it is specified in the TRIPs Agreement.

For more information on risks to the adequacy and effectiveness of our intellectual property, see Item 1A, "Risk Factors—Risks Related to Our Intellectual Property—Our long-term success depends on intellectual property protection;

if our intellectual property rights are invalidated, circumvented, or weakened, our business will be adversely affected."

Our Intellectual Property Portfolio

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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:

The 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 Product Protection Territory Estimated Expiry Date

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

Cardiometabolic Health products Jardiance*

compound patent U.S.

major European countries 2029

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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.

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biologics data protection U.S.

data protection major European countries 2024

Inluriyo compound patent U.S.

major European countries 2039

data protection U.S.

major European countries 2036

Jaypirca compound patent U.S.

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major European countries 2033

Retevmo compound patent U.S.

Therapeutic Area Product Protection Territory Estimated Expiry Date

Oncology products Retevmo compound patent U.S.

major European countries 2037

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compound patent

major European countries

biologics data protection U.S.

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Kisunla compound patent

biologics data protection

data protection

compound patent

data protection

major European countries

* Jardiance and the related combination product, Glyxambi.

biologics data protection

data protection major European countries

* Jardiance is part of our Boehringer Ingelheim collaboration.

In the U.S., Jardiance includes the related combination product, Glyxambi.

See Item 8, "Financial Statements and Supplementary Data—Note 3:

Collaborations and Other Arrangements".

The following product candidates are the most relevant that are currently under regulatory review.

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

• 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.

• Insulin efsitora alfa has been submitted for regulatory review in the U.S., the EU, and Japan for the treatment of type 2 diabetes.

• Orforglipron has been submitted for regulatory review in the U.S., the EU, and Japan for the treatment of obesity or overweight with at least one weight-related medical problem and in the EU for the treatment of type 2 diabetes.

Orforglipron was granted a Commissioner’s National Priority Voucher from the FDA, which could accelerate potential U.S.

approval timing.

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.

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In recent years, we have experienced an increase in patent challenges from generic manufacturers in many countries outside the U.S.

For more information on patent challenges and litigation involving our intellectual property rights, see Item 1A, "Risk Factors—Risks Related to Our Business—Our long-term success depends on intellectual property protection;

For more information on patent challenges and litigation involving our intellectual property rights, see Item 1A, "Risk Factors—Risks Related to Our Intellectual Property—Our long-term success depends on intellectual property protection;

if our intellectual property rights are invalidated, circumvented, or weakened, our business will be adversely affected" and Item 8, "Financial Statements and Supplementary Data—Note 16:

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In addition, our operations are subject to complex federal, state, local, and foreign laws and regulations concerning relationships with healthcare providers and suppliers, pricing and reimbursement for our products, the environment, occupational health and safety, data privacy and security, and other matters.

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.

and other authorities are actively proposing, enacting, and pursuing numerous policy, regulatory, and enforcement changes that impact our business.

These changes create additional uncertainty for our business, while in some cases presenting new opportunities for our business.

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) and the Public Health Service Act (PHS), the FDA exercises 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 (PHSA), 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 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.

The FDA holds broad discretion under the FDCA to interpret the conditions and evidence necessary for timely approval of and ability to market our products 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 inadequate agency 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.

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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, 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.

The FDA may also mandate labeling changes, post-marketing studies, or risk management programs 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.

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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.

Outside the U.S., our products and operations are subject to similar regulatory requirements, notably by the EMA in the EU, 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.

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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, 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.

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

Nonetheless, manufacturing quality and other aspects of pharmaceutical regulatory compliance are heavily scrutinized and result 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 affected 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.

Any determination by the FDA or other regulatory authority 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."

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.

We continue to see the production, marketing, and sale of counterfeit, misbranded, adulterated, and mass-compounded incretins in the U.S.

and other markets.

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.

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

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

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

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

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 participation in government 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, including the proposed EU Anti-Corruption Directive, which is expected to be adopted in 2026.

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

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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Regulations and Private Payer Actions Affecting Pharmaceutical Pricing, Reimbursement, and Access

There continues to be considerable public and government scrutiny of pharmaceutical pricing.

There continues to be considerable public and government scrutiny of pharmaceutical pricing, reimbursement, and access.

In addition, 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.

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

In November 2025, we announced preliminary voluntary agreements with the U.S.

government in which, among other arrangements, we agreed to implement measures to lower Medicaid and certain other drug prices for U.S.

patients and to launch new medicines with a more balanced pricing approach across developed nations.

As part of these agreements, we expect Medicare beneficiaries will have access to discounted Lilly obesity medicines by July 1, 2026, and States will have the option to expand access to these discounted medicines through Medicaid.

We will also participate in a government direct-to-patient purchasing platform that will direct people in the U.S.

to offerings to purchase certain medicines from us at significant discounts to current list prices.

The preliminary agreements also provide a three-year grace period during which time our products under a Section 232 investigation will not face tariffs, provided that we meet U.S.

manufacturing investment commitments.

We are currently in the process of negotiating definitive agreements to implement these arrangements.

In 2022, the U.S.

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

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.

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.

Currently, these government prices generally 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 list 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.

The Medicare price HHS determines may impact the product’s best price determination under the Medicaid Drug Rebate Program and the ceiling price

under 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 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, 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.

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

calendar year list price for a 30-day supply.

In January 2026, HHS selected Trulicity and Verzenio as additional medicines subject to government-set prices to be effective in 2028.

Given our product portfolio, we expect additional of our 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 impacts 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 and implemented Part D benefit redesign.

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

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Heightened governmental scrutiny over the manner in which drug manufacturers price their marketed products and the practices of pharmacy benefit managers and other supply chain entities has also resulted in several U.S.

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.

Additional policies, regulations, legislation, or enforcement, including those proposed or pursued by the U.S.

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, implement reference pricing, address pharmacy benefit manager practices, and reform government program reimbursement methodologies for drug products.

Restrictive or unfavorable pricing, coverage, or reimbursement determinations for our medicines or product candidates by governments, regulatory agencies, courts, or private actors have and may continue to adversely impact our business and financial results.

Additional policies, regulations, legislation, determinations, or enforcement, including those proposed or pursued by the U.S.

Congress, the U.S.

executive branch and regulatory authorities worldwide, could intensify these efforts and adversely impact our business and consolidated results of operations.

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).

executive branch, state attorneys general, and regulatory authorities worldwide, could adversely impact our business and consolidated results of operations.

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 the 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 reduced prices 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, 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.

For example, continued expansion of the 340B program and growth of entities claiming entitlement to 340B pricing, including in ways that may be inconsistent with the statutory scheme, impacts our revenue on an increasing percentage of sales.

For example, continued expansion of the 340B program and growth of entities claiming entitlement to 340B pricing, including in ways that may be inconsistent with the statutory scheme and through state laws that purport to mandate 340B sales to contract pharmacies, impacts our revenue on an increasing percentage of sales.

Changes to the calculation of rebates under the Medicaid program could also increase our Medicaid rebate obligations and decrease the prices charged to 340B covered entities.

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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 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.

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 subject to inquiries and ongoing litigation by Lilly and/or other parties, the resolution of which could impact the growth and scope of the 340B program.

For example, in November 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.

District Court for the District of Columbia agreed with HRSA in May 2025 that the government must preapprove Lilly’s cash replenishment model, which HRSA has not done.

Lilly appealed that decision to the U.S.

Court of Appeals for the District of Columbia.

Furthermore, states continue to adopt laws that, among other things, expand the 340B program by purporting to compel manufacturers to sell their medicines at 340B prices to an unlimited number of contract pharmacies.

Other manufacturers and trade associations continue to litigate the constitutionality of these laws in various federal courts.

Some courts have concluded that such laws are unconstitutional and have preliminarily enjoined them while others have rejected those challenges.

Rebates are also negotiated in the private sector.

We pay rebates to private payers that provide prescription drug benefits to seniors covered by Medicare and to private payers that provide prescription drug benefits to their customers.

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

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."

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

For a discussion of risks related to how we price our products, see Item 1A, "Risk Factors—Risks Related to Litigation and Government Regulation—We are party to litigation and investigations, which could adversely affect our business."

Outside the U.S.

Globally, public and private payers are increasingly restricting access to pharmaceuticals based on assessments of comparative effectiveness and value, including through the establishment of formal health technology assessment processes.

Globally, public and private payers restrict access to pharmaceuticals based on assessments of comparative effectiveness and value, including through the establishment of formal health technology assessment processes.

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.

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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.

The European Commission published its draft General Pharmaceutical Legislation in April 2023.

While certain elements in the European Commission draft could expedite regulatory timelines, we anticipate that the overall market and patient impact would be negative if the legislation is approved as drafted.

Implementation timing is unknown at this time.

Health care cost containment remains a focus in the EU, among other jurisdictions.

In December 2025 the European Commission, Council, and Parliament reached an agreement-in-principle on EU Pharmaceutical Legislation.

The implementation timeline and eventual impact on patients and the overall market is currently uncertain.

Budget pressures and associated cost containment measures remain a focus in the EU, among other jurisdictions.

The impact of the U.S.

government’s efforts to use trade or other measures to increase spending by developed countries on innovative medicines to reduce U.S.

prices remains unclear.

Most countries in the EU attempt to contain drug costs by engaging in some form of reference pricing in which authorities examine pre-determined internal or external markets for published prices of a product or national class of drugs.

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.

Member states also employ mandatory rebates, clawbacks, market caps, and other mechanisms to limit spending.

Other measures include restricting or delaying access to pharmaceutical product reimbursement under national health insurance, and member states may condition access on the basis of a reimbursement price or completion of cost-effectiveness or other gating studies.

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.

China has introduced and implemented reforms to accelerate access to innovative products and reduce costs.

To drive patient access, we seek inclusion of many of our branded products on China's National Reimbursement Drug List, a list of drugs fully or partially reimbursed by China’s national basic health insurance.

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

State-owned hospitals and the state insurance program account for the vast majority of drug purchases in China, impacting access-price negotiations that have intensified in recent years.

China's healthcare policies aim to balance accelerating patient access to innovative medicines with cost containment objectives.

To facilitate patient access in China, we seek and have secured inclusion of Mounjaro and other of our branded products on China's National Reimbursement Drug List, a list of drugs fully or partially reimbursed by China’s national basic health insurance.

In exchange for broad access, these products are generally subject to negotiation of significant price concessions.

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

China is also working to broaden its commercial health insurance offerings which have the potential

to increase patient access.

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

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

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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, access, 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, access, and reimbursement for our products as well as overall operations.

Reforms, initiatives, and other actions in our product markets, including those that may stem from political initiatives, periods of uneven economic growth or downturns or uncertainty, or as a result of inflation or deflation, trade and other global disputes and interruptions including related to tariffs, trade protection measures, and similar restrictions, the emergence, or escalation of, and responses to, international tension and conflicts, or government budgeting priorities, are expected to continue to result in added pressure on pricing, access, and reimbursement for our products.

The outcome of our preliminary agreements with the U.S.

government and broader U.S.

policy efforts to align domestic pharmaceutical pricing with international benchmarks from countries with competing healthcare cost containment priorities is uncertain and could impact our pricing strategies, product demand or access, or competitive positioning across global markets, and may result in reduced revenue in certain markets.

Moreover, we cannot predict the extent to which our business may be affected by current or potential future legislative, regulatory, or private actor 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 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.

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At the end of 2025, we employed approximately 12,000 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 immunology, metabolism (including diabetes, obesity and cardiovascular), neuroscience, and oncology.

Our internal pharmaceutical research focuses primarily on the areas of cardiometabolic health, immunology, 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.

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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 1) are conducted in small groups of subjects to assess safety and evaluate the potential dosing range.

In general, the first human tests (often referred to as Phase 1) are conducted in small groups of participants 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.

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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.

As a result, these candidates generally have a higher likelihood of success as compared to earlier stage candidates, 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.

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• Submission Phase

Once a potential new medicine is submitted to regulatory agencies, the time to final marketing approval can vary from several months to several years, depending on the disease state, the strength and complexity of available data, the degree of unmet need, and the time required for the regulatory agency(ies) to evaluate the submission, which can depend on prioritization by regulators and other factors.

Once a potential new medicine is submitted to regulatory agencies, the time to final marketing approval can vary from months to several years, depending on the disease state, the strength and complexity of available data, the degree of unmet need, and the time required for the regulatory agency(ies) to evaluate the submission, which can depend on prioritization by regulators and other factors.

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.

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

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.

Investments to increase our manufacturing capacity include new sites in North Carolina, Wisconsin, Indiana, Virginia, Texas, Alabama, Pennsylvania, Ireland, Germany, and the Netherlands.

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

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

officials have enacted and continue to consider legislation or other actions that are intended to limit supply chain reliance on China, including the 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.

and China have led to the imposition of tariffs, sanctions, and certain

other business restrictions between the U.S.

In 2025, the U.S.

government imposed new tariffs on Chinese goods, 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.

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—Our global operations subject us to risks, including as related to uneven economic growth or downturns, international trade, and other global disruptions, geopolitical tensions, or disputes" 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 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.

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 or supply of our products or 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.

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."

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 Operations—Manufacturing, quality, or supply chain difficulties, disruptions, or shortages could lead to product supply problems or other negative outcomes."

Quality Assurance

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

Additional assurance of quality is provided by quality assurance groups that audit and monitor all aspects of quality related to pharmaceutical manufacturing procedures and systems in company operations and at third-party suppliers.

Executive Officers of the Company

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Ricks has 29 years of service with Lilly.

Adrienne Brown 46 Executive Vice President and President, Lilly Immunology (since 2025).

Previously, Ms.

Brown held various leadership roles at Lilly, including group vice president of corporate business development from 2023 to 2025, group vice president, U.S.

Diabetes and Obesity from 2020 to 2023, and senior director Diabetes/GHD Business Unit from 2018 to 2020.

Brown has 22 years of service with Lilly.

Kenneth Custer, Ph.D.

47 Executive Vice President and President, Lilly Cardiometabolic Health (since 2025).

Custer has held various leadership roles with Lilly, including most recently, as president and general manager of Lilly Canada.

Previously, he served as senior vice president and head of corporate business development.

Custer has 17 years of service with Lilly.

Eric Dozier 59 Executive Vice President, Chief People Officer (since 2022).

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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 five years of service with Lilly.

Hakim has six years of service with Lilly.

Edgardo Hernandez 51 Executive Vice President and President, Manufacturing Operations (since 2021).

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Hernandez has 21 years of service with Lilly.

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.

Previously, he served as senior vice president and president, Lilly Bio-Medicines and president and general manager, Lilly Japan.

Carole Ho 53 Executive Vice President and President, Lilly Neuroscience (since 2025).

Prior to joining Lilly, Ms.

Ho served as chief medical officer and head of development at Denali Therapeutics Inc.

from 2015 to 2025.

Her biopharmaceutical experience includes leadership roles at Genentech, Inc.

Patrik Jonsson 59 Executive Vice President and President, Lilly International (since 2025).

Jonsson has held various leadership roles with Lilly, including, most recently, as Executive Vice President and President, Lilly Cardiometabolic Health and Lilly USA.

Previously, he served as Executive Vice President and President, Lilly Immunology and Lilly USA, and Chief Customer Officer, senior vice president and president, Lilly Bio-Medicines and president and general manager, Lilly Japan.

Jonsson has 35 years of service with Lilly.

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

Rau has four years of service with Lilly.

Rau has five years of service with Lilly.

Melissa Seymour 56 Executive Vice President, Global Quality (since 2024).

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Seymour was also the chief quality officer at Biogen.

Seymour has one year of service with Lilly.

Seymour has two years of service with Lilly.

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

51 Executive Vice President, Chief Scientific Officer and President, Lilly Research Laboratories and Lilly Immunology (since 2024).

52 Executive Vice President, Chief Scientific and Product Officer and President, Lilly Research Laboratories (since 2025).

Prior to assuming his current role, Dr.

Skovronsky served as Executive Vice President, Chief Scientific and Medical Officer, and President, Lilly Research Laboratories since 2018.

Skovronsky has held other leadership roles with Lilly, including as senior vice president, clinical and product development and vice president, diabetes research.

Skovronsky served as Executive Vice President, Chief Scientific Officer, and President, Lilly Research Laboratories and Lilly Immunology since 2024.

Skovronsky has held other leadership roles with Lilly, including as chief medical officer, senior vice president, clinical and product development and vice president, diabetes research.

Skovronsky has 15 years of service with Lilly.

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

Previously, Mr.

Van Naarden served as chief executive officer-Loxo Oncology at Lilly, and chief operating officer-Loxo Oncology at Lilly.

Jacob Van Naarden 41 Executive Vice President, President, Lilly Oncology and Head of Corporate Business Development (since 2025).

Prior to assuming his expanded role, Mr.

Van Naarden served as Executive Vice President and President, Lilly Oncology since 2021.

Previously, he served as chief executive officer-Loxo Oncology at Lilly, and chief operating officer-Loxo Oncology at Lilly.

Van Naarden joined Lilly in 2019 when the company acquired Loxo Oncology, Inc., where he was the chief operating officer.

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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 six years of service with Lilly.

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

Previously, Ms.

White held various leadership roles with Lilly, including senior vice president and president, Lilly Oncology, vice president of Portfolio Management, Chorus, and Next Generation Research and Development.

White has 29 years of service with Lilly.

Ilya Yuffa 50 Executive Vice President and President, Lilly International (since 2021).

Previously, Mr.

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

Van Naarden has seven years of service with Lilly.

Ilya Yuffa 51 Executive Vice President and President, Lilly USA and Global Customer Capabilities (since 2025).

Yuffa has held various leadership roles with Lilly, including, most recently, as Executive Vice President and President, Lilly International.

Previously, he served as 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.

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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.

Our core values—integrity, excellence, and respect for people—shape our approach to attracting, retaining, engaging, and developing a highly skilled 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 believe fostering a positive, inclusive 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 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.

Our focus on inclusion strengthens innovation at Lilly, and we always aim to hire the most qualified candidates.

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 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.

These results are 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 highly performing and cohesive workforce.

At the end of 2025, we employed approximately 50,000 people, including approximately 27,000 employees outside the U.S.

Our employees include approximately 12,000 people engaged in research and development activities.

Strategy and Oversight

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 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

We strive to foster a healthy, vibrant work environment, which includes keeping our employees safe.

We seek to create a companywide culture where best-in-class safety practices are consistently followed.

To do this, we assess and continuously attempt to improve our companywide safety performance to promote the well-being of employees and to help safeguard communities where we operate.

We believe a holistic approach and dedication to safety helps us be our best as we deliver on our company purpose to improve lives around the world.

Information Available on Our Website

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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