Lilly Reports Fourth-Quarter and Full-Year 2010 Results, Provides 2011 Financial Guidance

INDIANAPOLIS, Jan. 27, 2011 /PRNewswire/ –

— Higher volume drove four percent revenue growth in Q4.
— Gross margin improvements in Q4 led to growth in operating income.
— Fourth quarter earnings per share grew to $1.05 (reported), or $1.11
(non-GAAP).
— Full-year 2010 revenue topped $23 billion as eight human pharmaceutical
medicines and the company’s animal health business all exceed $1 billion
in annual sales.
— Full-year 2010 earnings per share grew to $4.58 (reported), or $4.74
(non-GAAP).
— 2011 earnings per share guidance range set at $3.92 – $4.07 (reported),
or $4.15 – $4.30 (non-GAAP).

Eli Lilly and Company (NYSE: LLY) today announced financial results for the
fourth quarter and full year of 2010.

$in millions, except per share data Fourth Quarter %
————– —
2010 2009 Growth
—- —- ——
Total Revenue – Reported $6,187.0 $5,934.2 4%
Net Income – Reported 1,169.6 915.4 28%
EPS – Reported 1.05 0.83 27%

Net Income – non-GAAP 1,234.9 999.4 24%
EPS – non-GAAP 1.11 0.91 22%

$in millions, except per share data Full Year %
——— —
2010 2009 Growth
—- —- ——
Total Revenue – Reported $23,076.0 $21,836.0 6%
Net Income – Reported 5,069.5 4,328.8 17%
EPS – Reported 4.58 3.94 16%

Net Income – non-GAAP 5,240.8 4,851.0 8%
EPS – non-GAAP 4.74 4.42 7%

Financial results for 2010 and 2009 are presented on both a reported and a
non-GAAP basis. Reported results were prepared in accordance with generally
accepted accounting principles (GAAP) and include all revenue and expenses
recognized during the period. Non-GAAP results exclude the items described in
the reconciliation tables. The non-GAAP results are presented in order to
provide additional insights into the underlying trends in the company’s
business. The company’s 2011 financial guidance is also being provided on both a
reported and a non-GAAP basis.

“Lilly’s fourth quarter results capped a year of solid financial performance in
which we achieved volume-driven revenue growth along with good expense control.
These results allowed us to deliver attractive earnings growth and a healthy
dividend for our shareholders, while still investing in the research and
development and business development activities that will enable us to bring the
next generation of new medicines to patients,” said John C. Lechleiter Ph.D.,
Lilly’s chairman and chief executive officer. “As we begin 2011, we remain
committed to our strategy of accelerating the flow of potential new medicines
through our pipeline and are prepared to meet the challenges of patent
expirations for several of our products.”

Key Events Over the Last Three Months

— The company announced a global agreement with Boehringer Ingelheim to
jointly develop and commercialize a portfolio of diabetes compounds
currently in mid- and late-stage development. Included are Boehringer
Ingelheim’s two oral diabetes agents–linagliptin and BI 10773–as well
as Lilly’s two basal insulin analogues – LY2605541 and LY2963016 – along
with an option to co-develop and co-commercialize Lilly’s anti-TGF-beta
monoclonal antibody.
— The company completed the acquisition of Avid Radiopharmaceuticals,
Inc., a company developing novel molecular imaging compounds intended
for the detection and monitoring of chronic human diseases. In addition,
the U.S. FDA assigned priority review designation to the marketing
application for Amyvid(TM) (florbetapir), Avid’s lead program in
development. The Peripheral and Central Nervous System Drugs Advisory
Committee of the FDA held a meeting to discuss Amyvid’s new drug
application on January 20, 2011. The Committee decided that it could not
recommend approval of Amyvid at this time based on the currently
available data (13-3); but, voted unanimously (16-0) to recommend
approval of Amyvid conditional on a reader training program that
demonstrates reader accuracy and consistency through a re-read of
previously acquired scans. The Committee supported that efficacy was
established and there were no significant safety concerns raised.
— The U.S. Food and Drug Administration (FDA) Gastrointestinal Drugs
Advisory Committee voted to recommend non-approval of liprotamase, a
non-porcine pancreatic enzyme replacement therapy, currently under FDA
review for the treatment of exocrine pancreatic insufficiency. During
the meeting, the Committee had questions about the degree of efficacy of
liprotamase and recommended that additional studies be conducted prior
to considering approval of liprotamase for EPI. The company will
continue to work with the FDA to address the questions raised in the
meeting as the agency moves toward a final decision on the application.
— The U.S. District Court for the District of Delaware ruled that judgment
would be entered in the company’s favor regarding its Alimta