Eli Lilly 2004 Annual Report Download

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Eli Lilly and Company
200
4 Annual Report
Notice of 2005 Annual Meetin
g
a
nd Proxy
S
tatement
Answers for Shareholders 2004
r
A

Table of contents

  • Page 1
    Answers for Shareholders 2004 Eli Lilly and Company 2004 Annual Report Notice of 2005 Annual Meeting and Proxy Statement

  • Page 2
    ... Management's Report on Internal Control Over Financial Reporting Report of Independent Registered Public Accounting Firm Proxy Statement 52 54 58 62 67 69 77 78 79 88 89 Notice of 2005 Annual Meeting and Proxy Statement General Information Board of Directors Highlights of the Company's Corporate...

  • Page 3
    ... Financial Highlights ELI LILLY AND COMPANY AND SUBSIDIARIES (Dollars in millions, except per-share data) Year Ended December 31 2004 2003 Change % Net sales ...Research and development ...Research and development as a percent of sales ...Net income ...Earnings per share-basic ... $13,857.9 2,691...

  • Page 4
    ... of the Board, President, and Chief Executive Officer "Fair Balance" To Our Shareholders Clearly, for the pharmaceutical industry as a whole, the tough sledding of the past few years intensified in 2004. Many companies are struggling with significant business challenges including looming patent...

  • Page 5
    ... could not otherwise afford them. In 2004, "Lilly Cares" provided assistance to nearly 160,000 patients, a total donation worth about $166 million. I firmly believe these kinds of responsible policies and practices can, over time, achieve a better balance in the public view, especially as they are...

  • Page 6
    ... to deliver more-to fund a clinical trial that supports a new indication, or a new market research effort to bring our solutions to more patients who may be helped by them. In this effort, I believe we will be addressing both current and future business challenges. Greater productivity is a key to...

  • Page 7
    ...report issued in late 2004, the U.S. Department of Health and Human Services reaffirmed its long-standing opinion that allowing imports from other countries would also open a channel for potentially dangerous counterfeit drugs. The HHS task force found that total savings to consumers from legalized...

  • Page 8
    ... for unstable angina associated with stent procedure (1997) (developed by Centocor and marketed by Lilly, except in Japan) Alimta® Symbyax™ Yentreve ™ 2003 Cialis® Strattera® 2002 Forteo® 2001 1999 Xigris® Actos® 1998 Evista® 1996 Zyprexa® Humalog® 1995 Gemzar® ReoPro...

  • Page 9
    ... therapy for adult growth hormone deficiency (1995) for short stature caused by Turner syndrome (1997) for idiopathic short stature (2003) for type 1 and type 2 diabetes PIPELINE 1983 Humulin® New Drug Applications Under Review by the U.S. Food and Drug Administration Exenatide for type...

  • Page 10
    ...000 MDR-TB patients annually by 2010. Yet another program gives us the chance to advance our longtime commitment to diabetes care. Working with Project HOPE, which offers solutions to global health problems, Lilly is funding a partnership in China to create effective programs for diabetes prevention...

  • Page 11
    ... pharmaceutical companies. We have achieved a number of successes with recent product launches and late-stage pipeline developments, including: • We are in the process of rolling out the global launches of a number of new products, which include Alimta®, Cialis®, Cymbalta®, Forteo®, Strattera...

  • Page 12
    ... United States, we expect branded pharmaceutical products to be subject to increasing pricing pressures. Implementation of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA), which provides a prescription drug benefit under the Medicare program, will take effect January...

  • Page 13
    ... from 2003 Zyprexa ...Gemzar ...Humalog® ...Evista ...Humulin® ...Animal health products...Strattera ...Fluoxetine products...Anti-infectives ...Actos® ...Humatrope ...ReoPro® ...Forteo ...Xigris® ...Alimta ...Cialis2 ...Cymbalta...Symbyax ...Other pharmaceutical products . . Total net sales...

  • Page 14
    ... Increase in Net Sales ($ millions; percentages represent changes from 2003) +$193 +19% Established Key Products Newly Launched Growth Products Strattera Humalog Cymbalta Symbyax Diabetes care products, composed primarily of Humulin, biosynthetic human insulin; Humalog, our insulin analog...

  • Page 15
    ...of the Lilly ICOS LLC joint venture, due primarily to increased market- ing costs of Cialis in joint-venture territories, and the 2003 sale of dapoxetine patent rights. We report our 50 percent share of the operating results of the Lilly ICOS joint venture in our net other income. For 2004, our net...

  • Page 16
    ... 31, 2002 Total Percent Change from 2002 Zyprexa ...Humulin...Gemzar ...Humalog ...Evista ...Animal health products...Fluoxetine products...Anti-infectives ...Actos ...Humatrope ...Strattera ...ReoPro...Xigris ...Cialis2 ...Forteo ...Other pharmaceutical products . . Total net sales ... $2,645...

  • Page 17
    Consolidated Statements of Income ELI LILLY AND COMPANY AND SUBSIDIARIES (Dollars in millions, except per-share data) Year Ended December 31 2004 2003 2002 Net sales ...Cost of sales ...Research and development ...Marketing and administrative ...Acquired in-process research and development (Note 3)...

  • Page 18
    ... the long-term growth of our diabetes care and other products, as well as increased research and development activities. Total debt at December 31, 2004, was $6.51 billion, an increase of $1.63 billion from December 31, 2003, primarily due to the issuance of commercial paper to fund U.S. operating...

  • Page 19
    ... Sheets ELI LILLY AND COMPANY AND SUBSIDIARIES (Dollars in millions) December 31 2004 2003 Assets Current Assets Cash and cash equivalents ...Short-term investments ...Accounts receivable, net of allowances of $66.1 (2004) and $69.3 (2003)...Other receivables...Inventories ...Deferred income taxes...

  • Page 20
    ... including debt service, capital expenditures, dividends, and taxes in 2005. We believe that amounts available through our existing commercial paper program should be adequate to fund maturities of short-term borrowings, if necessary. Our commercial paper program is also currently Dividends Paid Per...

  • Page 21
    ... point in the development life cycle of the pharmaceutical product (e.g., approval of the product for marketing by the appropriate regulatory agency). If required by the arrangement, we may have to make royalty payments based upon a percentage of the sales of the pharmaceutical product in the event...

  • Page 22
    ... 2004. The amount of these obligations can be expected to change materially over time as new contracts are initiated and existing contracts are terminated or modified. APPLICATION OF CRITICAL ACCOUNTING POLICIES In preparing our financial statements in accordance with generally accepted accounting...

  • Page 23
    ...32 million effect on our income before income taxes. As of December 31, 2004, our Medicaid rebate liability was $279.6 million. Approximately 86 percent and 92 percent of our global rebate and discount liability results from sales of our products in the United States as of December 31, 2004 and 2003...

  • Page 24
    ... growth of our currently marketed products; developments with competitive products; the timing and scope of regulatory approvals and the success of our new product launches; foreign exchange rates; wholesaler inventory changes; other regulatory developments, litigation, and government investigations...

  • Page 25
    LEGAL AND REGULATORY MATTERS Three generic pharmaceutical manufacturers, Zenith Goldline Pharmaceuticals, Inc. (Zenith), Dr. Reddy's Laboratories, Ltd. (Reddy), and Teva Pharmaceuticals (Teva), have submitted abbreviated new drug applications (ANDAs) seeking permission to market generic versions of ...

  • Page 26
    ... District Court for the Eastern District of New York on April 16, 2004, and May 19, 2004, respectively. The cases seek damages for alleged personal injuries and also seek compensation for medical monitoring of individuals who have taken Zyprexa. A lawsuit was also filed that requests a class action...

  • Page 27
    Consolidated Statements of Cash Flows ELI LILLY AND COMPANY AND SUBSIDIARIES (Dollars in millions) ...Year Ended December 31 2004 2003 2002 Cash Flows From Operating Activities Net income ...Adjustments To Reconcile Net Income to Cash Flows From Operating Activities Depreciation and amortization ...

  • Page 28
    ... Income ELI LILLY AND COMPANY AND SUBSIDIARIES (Dollars in millions) Year Ended December 31 2004 2003 2002 Net income ...Other comprehensive income (loss) Foreign currency translation gains ...Net unrealized gains (losses) on securities...Minimum pension liability adjustment ...Effective...

  • Page 29
    ... location of the customer. The largest category of products is the neurosciences group, which includes Zyprexa, Prozac, Strattera, Cymbalta, Permax®, Symbyax, and Yentreve. Endocrinology products consist primarily of Humalog, Humulin, Actos, Evista, Forteo, and Humatrope. Oncology products consist...

  • Page 30
    ... First Net sales ...Cost of sales ...Operating expenses ...Asset impairments, restructuring, and other special charges ...Other-net...Income before income taxes...Net income ...Earnings per share-basic ...Earnings per share-diluted...Dividends paid per share...Common stock closing prices High...Low...

  • Page 31
    ...) ELI LILLY AND COMPANY AND SUBSIDIARIES (Dollars in millions, except per-share data) ...2004 2003 2002 2001 2000 Operations Net sales ...Cost of sales ...Research and development ...Marketing and administration ...Other ...Income before income taxes...Income taxes ...Net income ...Net income as...

  • Page 32
    ... Statements ELI LILLY AND COMPANY AND SUBSIDIARIES (Dollars in millions, except per-share data) Note 1: Summary of Significant Accounting Policies Basis of presentation: The accompanying consolidated financial statements have been prepared in accordance with accounting practices generally...

  • Page 33
    ...carrying value of our goodwill or other intangible assets in 2004, 2003, or 2002. Property and equipment: Property and equipment is stated on the basis of cost. Provisions for depreciation of buildings and equipment are computed generally by the straight-line method at rates based on their estimated...

  • Page 34
    ... share if we had applied the fair value recognition provisions of SFAS 123 to stock-based employee compensation. 2004 2003 2002 Net income, as reported ...Add: Compensation expense for stock-based performance awards included in reported net income, net of related tax effects ...Deduct: Total stock...

  • Page 35
    .... In December 2004, the FASB revised and issued SFAS 123, Share-Based Payment (SFAS 123(R)). SFAS 123(R) eliminates the alternative of using the APB 25 intrinsic value method of accounting for stock options. This revised statement will require recognition of the cost of employee services received in...

  • Page 36
    ... common stock of Applied Molecular Evolution, Inc. (AME) in a tax-free merger. Under the terms of the merger agreement, each outstanding share of AME common stock was exchanged for our common stock or a combination of cash and our stock valued at $18. The aggregate purchase price of approximately...

  • Page 37
    ..., Indiana, manufacturing site will be narrowed to make products solely for the Elanco Animal Health business. The portion of that site that currently produces human pharmaceutical products has ceased operation. We will focus our research efforts on the therapeutic areas of neuroscience, endocrine...

  • Page 38
    .... In addition, in the second quarter of 2004, as part of our ongoing review of our manufacturing and research and development strategies to maximize performance and efficiencies, including the streamlining of manufacturing operations and research and development activities, we also made decisions...

  • Page 39
    ... (net of tax) on available-for-sale securities increased (decreased) other comprehensive income by ($18.2) million, $45.4 million, and ($45.0) million in 2004, 2003, and 2002, respectively. Activity related to our available-for-sale investment portfolio was as follows: 2004 2003 2002 Proceeds from...

  • Page 40
    ... resettable coupon capital securities were redeemed in 2004. In 2003, we repurchased $257.1 million of ï¬,oating rate debt securities due in 2008. The 6.55 percent Employee Stock Ownership Plan (ESOP) debentures are obligations of the ESOP but are shown on the consolidated balance sheet because we...

  • Page 41
    ... 2002 Employee stock options ...Performance awards... $26.19 70.33 $20.59 63.51 $25.98 N/A FI N A N C I A L S The fair values of the options calculated in accordance with SFAS 123 were determined using a Black-Scholes option-pricing model with the following assumptions: 2004 2003 2002 Dividend...

  • Page 42
    ......Balance at December 31, 2002 ...Net income ...Cash dividends declared per share: $1.36 ...Retirement of treasury shares ...Purchase for treasury ...Issuance of stock under employee stock plans ...ESOP transactions...Reclassification ...Balance at December 31, 2003 ...Net income ...Cash dividends...

  • Page 43
    .... As of December 31, 2004 and 2003, no preferred stock has been issued. We have funded an employee benefit trust with 40 million shares of Lilly common stock to provide a source of funds to assist us in meeting our obligations under various employee benefit plans. The funding had no net impact on...

  • Page 44
    ...088 $2.50 FI N A N C I A L S Note 11: Income Taxes Following is the composition of income taxes: 2004 2003 2002 Current Federal ...Foreign ...State ...Deferred Federal ...Foreign ...State ...Unremitted earnings to be repatriated due to change in tax law...Income taxes ... $ 47.6 519.9 (10.6) 556...

  • Page 45
    ... in 2004, 2003, and 2002, respectively, to consolidated income before income taxes. We have a subsidiary operating in Puerto Rico under a tax incentive grant that begins to expire at the end of 2007. On October 22, 2004, the President of the United States signed into law the American Jobs Creation...

  • Page 46
    ... tax rate applicable to income before income taxes: 2004 2003 2002 United States federal statutory tax rate ...Add (deduct) International operations, including Puerto Rico ...Additional repatriation due to change in tax law ...Non-deductible acquired in-process research and development ...General...

  • Page 47
    ... due to overall market conditions in 2001 and 2002, our 10- and 20-year annualized rate of return on our U.S. defined benefit pension plans and retiree health benefit plan was approximately 10.3 percent and 11.9 percent, respectively, as of December 31, 2004. Health-care-cost trend rates were...

  • Page 48
    ... is public equity securities that are well diversified and invested in U.S. and international small-to-large companies. The remaining portion of the growth investment classification is represented by other alternative growth investments. Our defined benefit pension plan and retiree health plan...

  • Page 49
    ... District Court for the Eastern District of New York on April 16, 2004, and May 19, 2004, respectively. The cases seek damages for alleged personal injuries and also seek compensation for medical monitoring of individuals who have taken Zyprexa. A lawsuit was also filed that requests a class action...

  • Page 50
    ...2002, respectively, for net realized gains on sales of securities included in net income. The effective portion of cash ï¬,ow hedges is net of reclassification adjustments of $23.1 million and $27.2 million, net of tax, in 2004 and 2003, respectively, for realized losses on foreign currency options...

  • Page 51
    ... financial statements in accordance with generally accepted auditing standards of the Public Company Accounting Oversight Board (United States) and evaluate management's assessment and evidence about whether internal control over financial reporting was designed and operating effectively. Ernst...

  • Page 52
    ...31, 2004, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Eli Lilly and Company and subsidiaries' internal control over financial reporting...

  • Page 53
    ... standards of the Public Company Accounting Oversight Board (United States), the 2004 consolidated financial statements of Eli Lilly and Company and subsidiaries and our report dated February 14, 2005 expressed an unqualified opinion thereon. FI N A N C I A L S Indianapolis, Indiana February 14...

  • Page 54
    ..., Lilly Corporate Center, Indianapolis, Indiana, at 11:00 a.m. EST (Indianapolis time). If you are unable to attend in person, please join us via live webcast on the company's website at www.lilly.com. The webcast will be available for replay for 30 days. The notice of meeting and proxy statement...

  • Page 55
    ...requesting that the board of directors prepare a semi-annual report on the company's political contributions • to consider and vote on a shareholder proposal requesting that the board of directors adopt a senior executive compensation policy based on performance-based stock options • to consider...

  • Page 56
    ... to your account in the Lilly Employee Savings Plan (the savings plan). What constitutes a quorum? A majority of the outstanding shares, present or represented by proxy, constitutes a quorum for the annual meeting. As of the record date, 1,132,720,819 shares of company common stock were issued...

  • Page 57
    ....com. Please make sure you give us the control number from the e-mail message that you received notifying you of the electronic availability of these materials, along with your name and mailing address. By telephone. Shareholders in the United States, Puerto Rico, and Canada may vote by telephone by...

  • Page 58
    ... NT How do I contact the board of directors? You can send written communications to one or more members of the board, addressed to: Presiding Director, Board of Directors Eli Lilly and Company c/o Corporate Secretary Lilly Corporate Center Indianapolis, Indiana 46285 All such communications will be...

  • Page 59
    ...vote your shares online. If you have shares in more than one account, it is an easy way to avoid receiving duplicate copies of proxy materials. What are the costs of electronic delivery? The company charges nothing for electronic delivery. You may, of course, incur the usual expenses associated with...

  • Page 60
    ...executive officer from 1988 to 1990. Mr. Fisher is chairman of PanAmSat Corporation, a senior advisor for Kohlberg Kravis Roberts & Company, and a director of General Motors Corporation. He is a member of The Business Council and was chairman of the National Academy of Engineering from 2000 to 2004...

  • Page 61
    ...a corporate vice president of General Motors Corporation (GM) and chairman and managing director of Vauxhall Motors Limited, a subsidiary of GM in the United Kingdom, from 1993 to 1996. Mr. Golden joined GM in 1970 and held a number of executive positions in that company's domestic and international...

  • Page 62
    ...The New York Times Company as well as several private companies. She serves on the boards of The New York & Presbyterian Hospital, Lincoln Center Theater, Families and Work Institute, and Citymeals-on-Wheels. Sidney Taurel Chairman of the Board, President, and Chief Executive Officer Director since...

  • Page 63
    ... Company, International Flavors & Fragrances Inc., and Northrop Grumman Corporation. He is chairman of the Accountability Advisory Council to the Comptroller General of the United States. He was a member of the National Association of Corporate Directors Blue Ribbon Panel on Corporate Governance...

  • Page 64
    ...the company's management. Their responsibilities include: • providing general oversight of the business • approving corporate strategy and major management initiatives • providing oversight of legal and ethical conduct • nominating, compensating, and evaluating directors • evaluating board...

  • Page 65
    ... New York Stock Exchange and Securities and Exchange Commission. This code is set forth in: • The Red Book, a comprehensive code of ethical and legal business conduct applicable to all employees worldwide and to our board of directors • the company's Code of Ethical Conduct for Lilly Financial...

  • Page 66
    ....cfm or in paper form upon request to the company's secretary. The audit committee and public policy and compliance committee assist in the board's oversight of compliance programs with respect to matters covered in the code of ethics. V. Functioning of the Board Executive Session of Directors The...

  • Page 67
    ... and social responsibility • reviews emerging political, social, and public policy issues that may affect the company. Finance Committee • reviews and makes recommendations regarding capital structure and strategies, including dividends, share repurchases, capital expenditures, complex business...

  • Page 68
    ... 700 shares of Lilly stock in a deferred stock account in the Lilly Directors' Deferral Plan (as described below), payable after service on the board has ended. • Stock options under the 2002 Lilly Stock Plan for 2,800 shares of Lilly stock. The option price is the fair market value at the time of...

  • Page 69
    ...banking, and marketing/sales • international business • medicine and science • government and public policy • information technology. The board delegates the screening process to the directors and corporate governance committee, which receives direct input from other board members. Potential...

  • Page 70
    ... of internal controls and disclosure controls. In this context, we have met and held discussions with management and the independent auditors. Management represented to us that the company's consolidated financial statements were prepared in accordance with generally accepted accounting principles...

  • Page 71
    ... related to internal control reviews, employee benefit plan audits, and accounting consultations Tax Fees • 2004 and 2003: primarily related to tax planning and various compliance services All Other Fees • 2004: primarily related to upgrading and maintaining on-line training programs Total...

  • Page 72
    ... with other global pharmaceutical companies of comparable size and stature to the company. For this benchmarking, we use the peer group identified on page 77. We compare the executive compensation programs as a whole, and we also compare the pay of individual executives if we believe the jobs are...

  • Page 73
    ... research charges, as well as a one-time tax expense for the expected repatriation of earnings under the American Jobs Creation Act in 2004, and a one-time gain on a technology licensing transaction in 2003. Other Compensation. In 2003 and 2004, we undertook a total executive compensation review...

  • Page 74
    ... the company's productivity and reduce its cost structure to enable it to continue to compete in an increasingly challenging business environment. In recognition of his continued strong leadership in 2003, we increased Mr. Taurel's annual salary by 5 percent to $1.52 million effective April 2004. Mr...

  • Page 75
    ... a time-share fee for the use of the aircraft for personal ï¬,ights. See page 76. (4) All eligible global management received a payout of shares of Lilly stock under the performance award program based on earnings per share growth in 2004. For most management employees, the payout was in the form of...

  • Page 76
    .... Armitage held 5,000 shares of restricted stock valued at $283,750, as of December 31, 2004. (5) Company contribution to the named individual's account in the company's employee savings plan ("Savings Plan"). (6) During the 2002 calendar year, Mr. Taurel chose to accept an annual salary of $1.00 as...

  • Page 77
    ... and none were outstanding on December 31, 2004. (2) Represents the amount by which the market price of Lilly stock exceeded the exercise prices of unexercised options held by the named individuals on December 31, 2004. Retirement Plan Pension Plan Table Average Annual Earnings (Highest 5 of Last 10...

  • Page 78
    ... Internal Revenue Code as a result of the aggregate compensation payments and benefits made to the individual, under the program or otherwise, the company would cover the cost of the excise tax. Related Transaction As noted above, under board policy, for security reasons Mr. Taurel must generally...

  • Page 79
    ... that dividends paid by a company are reinvested in that company's stock. Comparison of Five-Year Cumulative Total Return Among Lilly, S&P 500 Stock Index, and Peer Group* Value of $100 invested on last business day of 1999 Dec. 1999 Dec. 2000 Dec. 2001 Dec. 2002 Dec. 2003 Dec. 2004 1999...

  • Page 80
    ... Employee Savings Plan, shares credited to the accounts of outside directors in the Directors' Deferral Plan, and total shares beneficially owned by each individual, including the shares in the respective plans. In addition, the table shows shares that may be purchased pursuant to stock options...

  • Page 81
    ... Capital Research and Management Company. The following table sets forth information regarding this ownership: Name and Address Number of Shares Beneficially Owned Percent of Class Lilly Endowment, Inc. 2801 North Meridian Street Indianapolis, Indiana 46208 Capital Research and Management Company...

  • Page 82
    ...governance committee and the public policy and compliance committee of the board have reviewed this proposal, and believe that the strategy of combining the roles of board chair and chief executive officer ("CEO") generally provides the most efficient and effective leadership model for the company...

  • Page 83
    ... (MDR-TB) via the WHO at a fraction of production cost. As part of this program, we are transferring-free of charge-the technology to manufacture these drugs in nations where the disease is most prevalent. We are partnering with the WHO, the U.S. Department of Health and Human Services Center for...

  • Page 84
    ... supply of drugs in foreign markets, and (2) prepare a report to shareholders on that policy, at reasonable cost and omitting proprietary information, by September 2005. Statement of Support: Increasingly U.S. citizens, especially seniors, are purchasing prescription drugs abroad because such drugs...

  • Page 85
    ... report. We have acted independently to develop supply chain management systems, policies, and associated customer contracts. We do not believe we will assume regulatory risk by employing our current global strategy linking supply of our products to Canadian wholesalers to Canadian patient demand...

  • Page 86
    .... This report shall be posted on the company's website to reduce costs to shareholders. PROX Y S TATE M E NT Statement of Support: As long-term shareholders of Eli Lilly, we support policies that apply transparency and accountability to corporate political giving. In our view, such disclosure is...

  • Page 87
    ...Support: As shareholders, we support compensation policies for senior executives that provide challenging performance objectives and motivate executives to achieve long-term shareholder value. We are concerned, however, that Lilly is not tying the award of stock options closely enough to the Company...

  • Page 88
    ... used market-price options, as circumstances require. For Lilly executives, cash and equity compensation are tied closely to both individual and company performance. The compensation committee takes into account individual performance in establishing base salaries as well as the size of bonus...

  • Page 89
    ... Animal Testing Proposal The public policy and compliance committee of the board has reviewed this proposal and recommends that you vote against it. We are committed to the responsible treatment of all laboratory animals and work to eliminate or reduce their use in our pharmaceutical research. Where...

  • Page 90
    ... to the company, as well as other records and information. Based on that review, we concluded that all reports were timely filed except: Mr. Gerhard Mayr (now retired) was late in reporting a stock option grant; Dr. Steven Paul was late in reporting shares of stock withheld to pay taxes due upon...

  • Page 91
    ... or to meet with any members of, or advisors to, the committee. The committee may, at any time, retain its own outside advisors at the company's expense. Supporting Corporate Staff General Auditor Office of the Corporate Secretary Chief Accounting Officer Duties and Responsibilities To ful...

  • Page 92
    ... matters; and • Protecting reporting employees from retaliation. 12. Together with the public policy and compliance committee, assist the board in its oversight of legal and regulatory compliance. The audit committee shall have sole oversight over matters of financial compliance (accounting, 90

  • Page 93
    ... financial reporting, and investor disclosures). As to all other areas of compliance ("non-financial compliance"), the public policy and compliance committee shall have oversight responsibilities in the first instance; however, the two committees shall meet jointly at least annually to review the...

  • Page 94
    ... Vice President, U.S. Sales and Marketing-Neuroscience, Family Health, and Diabetes C O R P O R ATE I N FO R M AT I O N David E. Thompson B Albertus J. van den Bergh B Thomas R. Verhoeven, Ph.D. B Alfonso G. Zulueta B A Policy Committee B Senior Management Forum Establishes corporate strategy...

  • Page 95
    ... to: Eli Lilly and Company P.O. Box 88665 Indianapolis, Indiana 46208-0665 To access these reports more quickly, you can find all our SEC filings online at: http://investor.lilly.com/edgar.cfm Stock listings Wells Fargo Shareowner Services Mailing address: Shareowner Relations Department P.O. Box...

  • Page 96
    ...® Arxxant™ Axid® Ceclor® Cialis® Coban® Cymbalta® Evista® Forteo® Gemzar® Humalog® Humatrope® Humulin® Paylean® Permax® Prozac® Prozac® Weekly™ ReoPro® Rumensin® Sarafem® Strattera® Symbyax™ Tylan® Vancocin® Xigris® Yentreve™ Zyprexa® Zyprexa® Zydis® (pioglitazone...

  • Page 97
    ... Eli Lilly and Company 2005 Annual Meeting of Shareholders Monday, April 18, 2005 11 a.m. EST (Indianapolis time) Lilly Center Auditorium Lilly Corporate Center Indianapolis, Indiana 46285 The top portion of this page will be required for admission to the meeting. Please write your name and address...

  • Page 98
    ... of this page with you to the meeting. Detach here Detach here Eli Lilly and Company Annual Meeting of Shareholders April 18, 2005 Complimentary Parking Lilly Corporate Center Please place this identifier on the dashboard of your car as you enter Lilly Corporate Center so it can be clearly seen...

  • Page 99
    ...-RX-LILLY Lilly Cares...www.lillycares.com or call toll-free 1-800-545-6962 Lilly corporate responsibility ...www.lilly.com/about/citizenship Medicare reform ...www.cms.hhs.gov/medicarereform Pharmaceutical industry patient assistance programs ...www.pparx.org © 2005 Eli Lilly and Company 500002R

  • Page 100
    Eli Lilly and Company Lilly Corporate Center Indianapolis, Indiana 46285 USA www.lilly.com