ELI LILLY AND COMPANY 2015 Integrated Report p2 Overview p17 Business Review p23 Advancing Medical Science p45 Improving Global Health p66 Strengthening Communities p72 Operating Responsibly p123 Global Reporting Initiative Index p134 United Nations Global Compact Index Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact Overview
p3 Message from the CEO p5 About Lilly, About Elanco p6 Key Performance Indicators p8 Celebrating 140 Years of Caring and Discovery p11 Our Approach to Integrated Reporting
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 2 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
positive Phase III studies on MESSAGE FROM baricitinib and strong Phase III data on ixekizumab; and in oncology, Breakthrough Therapy Designation THE CEO for olaratumab and abemaciclib, several important business develop- ment deals in immuno-oncology, and Dear Lilly Stakeholders: the approval of Portrazza™ for the treatment of metastatic squamous May 10, 2016, marks the 140th anni- non-small cell lung cancer late in versary of the founding of Eli Lilly and the year. Company, a milestone that very few John C. Lechleiter, Ph.D., Lilly’s chairman, president, and chief executive officer, and Jan Lundberg, Ph.D., Our strong pipeline portends a lot of U.S. companies our size have ever president of Lilly Research Laboratories, join with employees of the Lilly Cambridge Innovation Center in good news for patients—the ulti- reached. We’ve done it by staying true Cambridge, Massachusetts, at the center’s opening. mate measure of our success. As of to our values—integrity, excellence, early 2016, we had nine molecules and respect for people—and to our totaling $1.17 per share. Reported 2015 Business Results and in Phase III testing or regulatory mission of discovering and developing earnings per share were $2.26. (For review, including potential medicines new medicines that make life better Pipeline Progress information on the items that were that hold the promise of significant for people around the world. In 2015, despite unprecedented and adjusted for purposes of non-GAAP advances in the treatment of im- substantial currency headwinds financial measures, please see the In 2015, our commitment to innovation munological disorders, Alzheimer’s brought on by the strengthening U.S. 2015 Financial Highlights in the 2015 bore fruit in a truly extraordinary year disease, and various pain conditions. dollar, we returned to revenue growth, Annual Report.) for Lilly. Even as we turned the corner led by Cyramza® and Trulicity® Investors have taken note of how in our business results and began to This progress occurred in the face of following their strong launches, with we’ve performed and how we’ve kept grow again after a prolonged period some serious challenges, including significant contributions from our our promises despite the challenges. of patent expirations, we achieved a still-sluggish global economy, a sig- enlarged Elanco animal health busi- Our stock price was up 22 percent unprecedented progress across our nificant slowdown in China, and con- ness. Revenue increased 2 percent to for the year, leading to a 25 percent research and development efforts. tinued pricing pressures in the United $19.96 billion, as six of our products total shareholder return—once again Through it all, we honored our com- States and other established markets. and Elanco exceeded $1 billion in outperforming most of our peers. mitments to those who have a stake annual sales. In 2015, Lilly achieved significant in our business—including patients, The bottom line is pretty simple. advances in our pipeline of molecules customers, physicians, the communities At the same time, as a result of lower We have emerged from the so-called in clinical development. Highlights where we operate, our shareholders, expenses and higher other income, “YZ” years of patent expirations as a include: in diabetes, positive cardio- and our employees who make it earnings per share increased 13 better, stronger company. And a very vascular outcomes data for all possible. percent to $3.43 on a non-GAAP promising future is unfolding by the day! basis, which excludes adjustments Jardiance®; in immunology, four
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Looking Ahead to More Our Ongoing Commitment to Over the past year, Lilly employees Faithful to Our Mission, have added to our strong track record Growth in 2016 Corporate Responsibility of volunteerism to strengthen com- Confident in Our Future I could not be more excited about In 2015, we also demonstrated our munities. In the first five years of our Our company has been through some what lies ahead in 2016 as we look dedication to corporate responsibility— Connecting Hearts Abroad program, real challenges these past few years. forward to additional launches and a legacy dating back to our founder, 1,000 Lilly employees have worked a But we confronted them head on, some important pipeline milestones. Colonel Eli Lilly. combined 64,000 hours during two- figured out a strategy to handle what we faced, and executed that strategy While recognizing the challenging Our greatest contribution to society week assignments in impoverished with grit and determination. We never environment ahead of us, we continue will always be making medicines that communities across Africa, Asia, wavered. And in 2015, we got sure to believe that Lilly’s growth opportu- make life better. Eastern Europe, and Latin America. signs that it’s working. nities will depend largely on our own In addition, our employees worldwide Yet we firmly believe that we have performance. This includes realizing have volunteered 825,000 hours since As we continue to honor Colonel a further role to play by collaborat- continued strong uptake of Cyramza, 2008 through our annual Global Day Lilly’s instruction to his son, to “take ing with select partners to address Trulicity, and Jardiance, and good of Service. And in 2015, we built on what you find here and make it better serious health challenges and to launches of Portrazza and the other our legacy of support for United Way and better,” I believe uncertainty will enhance access to high-quality care products, such as ixekizumab, that by initiating a partnership approach once again give way to confidence in for people around the world. In 2015, we hope will emerge from our pipe- that includes pairing Lilly teams with what an enterprise such as ours— we continued support of our two sig- line in the months ahead. United Way agencies. dedicated for 140 years to making nature global health programs—the lives better for people all over the I’m confident that we’ve put the Lilly NCD Partnership and the Lilly Lastly, we continue to demonstrate world—is able to accomplish. necessary investments behind these MDR-TB Partnership—focused on a firm commitment to operating recent and upcoming launches. At the growing challenge of non- responsibly in all areas of our busi- I am honored to be a part of this work the same time, we will continue to communicable diseases, such as ness—from being recognized year and grateful to you for your support. depend on strong sales of Alimta®, diabetes, and the stubborn scourge after year around the world as a For the Board of Directors, Forteo®, Cialis®, and our insulins— of multidrug-resistant tuberculo- great place to work, to continually despite the necessary shift of some sis. Elanco continued its important striving to reduce our environmental resources to the launch side. work to address the key link between footprint. This commitment extends nutrition and health through its to our support for the United Nations partnership with Heifer International Global Compact and its principles and through HATCH™ for Hunger, a related to human rights, labor, the John C. Lechleiter, Ph.D. environment, and anti-corruption. community partnership to provide Chairman, President, and Chief eggs to undernourished people in the Executive Officer Midwest.
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ABOUT LILLY
Lilly is a global healthcare leader that unites caring with discovery to make life better for people around the world. We were founded more than a century ago by a man committed to creating high-quality medicines that meet real needs, and today we remain true to that mission in all our work. Across the globe, Lilly employees work to discover and bring life- ABOUT ELANCO changing medicines to those who need them, Elanco provides comprehensive products and knowledge services improve the understanding and management to improve animal health and food-animal production in more than 70 countries around the world. We value innovation, both in scientific of disease, and give back to communities research and daily operations, and strive to cultivate a collaborative work environment for more than 6,500 employees worldwide. Together through philanthropy and volunteerism. To learn with our customers, we are committed to raising awareness about global food security, and celebrating and supporting the human-animal more about Lilly, visit us at www.lilly.com and bond. Founded in 1954, Elanco is a division of Eli Lilly and Company. Our worldwide headquarters and research facilities are located in newsroom.lilly.com/social-channels. Greenfield, Indiana. Visit us at www.elanco.com.
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Key Performance Indicators
FINANCIAL WORKPLACE* PHILANTHROPY***,****
Worldwide Revenue ($ millions) Stock Price ($ at year end) Fleet Collision Rate** (% of fleet) Total Contributions ($ millions) 2015 $19,958.7 2015 $84.26 2015 $560 2014 $19,615.6 2014 $68.99 2011 2012 2013 2014 2015 2014 $590 2013 $23,113.1 2013 $51.00 2013 $750 22% 21% 19% 18% 16% 2012 $22,603.4 2012 $49.32 2012 $700 2011 $24,286.5 2011 $41.56 2011 $597 Recordable Injury Rate (per 100 employees) U.S. Revenue ($ millions) Dividend ($ per share) Product Donations ($ millions) 2015 $10,097.4 2011 2012 2013 2014 2015 2015 $510 2015 $2.00 2014 $ 9,134.1 1.09 1.10 0.88 0.88 0.87 2014 $550 2014 $1.96 2013 $12,889.7 2013 $695 2013 $1.96 2012 $12,313.1 2012 $645 2012 $1.96 2011 $12,977.2 Lost-time Injury Rate 2011 $549 2011 $1.96 (per 100 employees) Europe Revenue ($ millions) Cash Contributions ($ millions) 2011 2012 2013 2014 2015 2015 $3,943.6 2015 $50 0.47 0.49 0.36 0.35 0.26 2014 $4,506.7 Research & Development ($ millions) 2014 $40 2013 $4,338.4 2015 $4,796.4 2013 $55 2012 $4,259.7 2014 $4,733.6 2012 $55 2011 $5,290.9 2013 $5,531.3 2011 $48 Other Foreign-Country Revenue ($ millions) 2012 $5,278.1 2015 $5,917.7 2011 $5,020.8 2014 $5,974.8 2013 $5,885.0 2012 $6,030.6 2011 $6,018.4
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Key Performance Indicators (continued)
ENVIRONMENT†
Greenhouse Gas Emissions ††† (Scope 1 and 2) (metric tonnes C0 e) Water Intake (billion liters) Waste Recycling Rate (%) Other Combustion Air Emissions (metric 2 tonnes SO , NO , and particulate matter) 2015 14.2 2 X 2015 2015 1,540,000 2014 15.0 2012 2013 2014 2015 2,483 2014 1,540,000 2013 13.7 2014 2,753 2013 1,600,000 2012 13.4 47% 43% 53% 51% 2013 3,072 2012 1,550,000 2012 1,832 Total Waste Generation†† Waste to Landfill (metric tonnes) Greenhouse Gas Emissions Intensity Reportable Permit-Limit Exceedances†††† (metric tonnes) 2015 29,100 (related to goal) (metric tonnes 2015 2012 2013 2014 2015 C0 e/1,000 square feet) 252,000 2014 12,000 2 2014 295,000 8 5 3 5 2012 2013 2014 2015 2013 22,600 2013 57.1 58.3 57.7 55.1 310,000 2012 20,700 2012 285,000
Energy Consumption (million BTUs) * Read the Health and Safety at Lilly section to learn more about † Following World Resources Institute guidance, energy use, green- 2015 11,000,000 our new safety goals for 2020. house gas emissions (except Scope 3), waste, and water use data 2014 11,200,000 ** In prior reports, we tracked the motor-vehicle collision rate are reported on an adjusted basis accounting for mergers, acqui- (collisions per million miles driven). We now are tracking vehicle sitions, and divestitures, as appropriate, to ensure comparability, 2013 11,300,000 safety based on percent of fleet involved in a collision. Historical unless stated otherwise. Data are included beginning in 2012, as 2012 10,800,000 collision rates shown in this table have been restated. that is the baseline year for Lilly's 2020 environmental goals. *** Total charitable donations include funding from both Lilly and †† Total waste may vary as the result of non-routine waste such as The Eli Lilly and Company Foundation. waste from construction and demolition work. **** In 2014 and 2015, we saw a decrease in the number of people ††† The recycling rate of total waste that is not beneficially reused. Energy Intensity requesting assistance through our U.S. patient assistance programs †††† Lilly classifies an event as a reportable permit-limit following the implementation of the Affordable Care Act, which exceedance if it involves an exceedance of a numeric permit or (million BTUs/1,000 square feet) allows previously uninsured low-income Americans to obtain license limit that must be reported to the regulatory authority. The 2012 2013 2014 2015 healthcare coverage. As a result, fewer people were in need of reporting may be immediate (e.g., within 24 hours) or in a routine donations from Lilly. compliance report. These exceedances do not necessarily result in 450 466 470 446 harm to people or the environment.
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Celebrating 140 Years of Caring and Discovery
Throughout our company’s history, we’ve brought new and better medicines to people who need them—commercializing the first insulin, introducing important classes of antibiotics, revolutionizing the treatment of mental illness, making critical contributions in the treatment of cancer, and more. Today, we remain committed to pursuing medicines for maladies such as diabetes and Alzheimer’s disease.
Our company vision also calls on us to give back to the world around us. Our founder, Colonel Lilly, took an active leadership role in efforts to improve life in Indianapolis, home to our global headquarters. Ever since, Lilly people have built upon and continued this legacy. We give of our financial resources, our time, and our expertise to make a meaningful, measurable, and sustainable difference in communities around the globe.
Here is a snapshot of just some of our key moments of caring and discovery over the past 140 years.
1886 1906 1917 Lilly hires first chemist, Lilly sends freight car of Partnering with the American Ernest Eberhardt. emergency medical supplies Red Cross, Lilly sets up a to San Francisco following medical field hospital in France, earthquake. staffed by Indiana personnel, to treat wounded soldiers of all nationalities during World War I.
1870 1880 1890 1900 1910 1920
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1876Founding 1923Insulin 1943Penicillin-G 1955Polio Vaccine Eli Lilly founded his company on May 10, Our researchers collaborated with Lilly was among the first companies From 1940 to the mid-1950s, polio 1876, in Indianapolis, Indiana. He was Frederick Banting and Charles Best to develop a method to mass-produce struck 400,000 American children among those first in the business to of the University of Toronto to isolate penicillin, the world’s first antibiotic, and millions more worldwide. In rely on pharmaceutical chemistry. and purify insulin for the treatment marking the beginning of a sustained 1954, Lilly was approached by the His purpose was to produce quality of diabetes, a fatal disease with no effort to fight infectious diseases. National Foundation for Infantile medicines to be given with a doctor’s effective treatment options at the Penicillin was especially critical Paralysis to produce a vaccine prescription—a new concept in a time. In 1923, their work resulted during World War II in helping to based on Dr. Jonas Salk’s method. time of untested elixirs and potions in Lilly’s introduction of the world’s reduce the number of deaths and Ultimately, more than half of all peddled by questionable characters. first commercially available insulin amputations caused by infected the Salk vaccine used in the United More than a century later, Lilly, the product. Lilly would go on to focus on battle wounds. Lilly’s antibiotics States bore the Lilly label. Today, company, remains recognized for innovations in diabetes treatment that work would continue in the coming polio is 99% eradicated around the its quality and values—integrity, continue to the present day. decades, including the launch of world, with only three countries re- excellence, and respect for people. a powerful antibiotic that today porting instances of the disease. remains the last line of defense against serious hospital infections.
1923 1958 1961 ILETIN® VANCOCIN® VELBAN® Lilly Lilly introduces vancomycin hydrochloride, Lilly introduces introduces an antibiotic for infections associated with vinblastine sulfate, the animal-source certain types of resistant bacteria. company’s first oncology insulin, the drug, for treatment of world’s first several types of cancer. commercially 1928 1937 1957 available Lilly establishes first Lilly family creates the Lilly Lilly leaders become co-chair and insulin distribution branch outside Endowment, which has given honorary chair of the first United Fund product, for of the United States, in away more than $8.5 billion Drive, an antecedent to the modern- the treatment Shanghai. to charitable organizations day United Way of Central Indiana. of diabetes. since its founding.
1920 1930 1940 1950 1960 1970
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Future Oncology ® Prozac1988 We are committed to developing a broad portfolio of therapies, including those tailored to patients, and meaningful support With the introduction of Prozac in the solutions that accelerate the pace and progress of cancer care. United States, Lilly launched the first in a new class of drugs used to treat Pain clinical depression. Called selective It is estimated that nearly one in five adults suffers from chronic serotonin reuptake inhibitors, or pain. Lilly is developing molecules to treat cluster headaches, SSRIs, the medicines are thought to migraines, and chronic pain caused by osteoarthritis and cancer. affect the way that serotonin acts— Neurodegeneration and neural pathways operate—inside Neurodegeneration is a key therapeutic area for Lilly, given our the brain. strong legacy and expertise in neuroscience. Our discovery efforts are focused on the areas of Alzheimer’s disease, dementia, and schizophrenia. Diabetes Lilly is committed to meeting the needs of people with diabetes by offering a comprehensive and complementary portfolio of medi- cines. We help people with diabetes achieve their treatment goals. Immunology Significant unmet medical need exists for many prevalent 1979 1982 1996 immunologic and autoimmune diseases, such as rheumatoid CECLOR® HUMULIN® ZYPREXA® arthritis, psoriasis, and lupus. Several molecules in our pipeline Lilly introduces Lilly introduces Lilly introduces olanzapine explore how to address these diseases. cefaclor, a human insulin (rDNA for the treatment of member of the origin), insulin schizophrenia. cephalosporin identical to that ® family, which produced by the GEMZAR 2003 2011 eventually human body, and the Lilly introduces Launch of the Lilly Lilly launches Connecting becomes the world’s first human gemcitabine MDR-TB Partnership, Hearts Abroad, an employee world’s top- healthcare product hydrochloride, a drug providing critically volunteer program that sends selling oral created using for the treatment of needed medicines for dozens of employees annually antibiotic. recombinant DNA pancreatic and non-small multidrug-resistant to countries in Africa, Asia, and technology. cell lung cancer. tuberculosis. Latin America.
1970 1980 1990 2000 2010 2020
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Our Approach to Integrated Reporting
This year, for the first time, Lilly is introducing an integrated report, combining two traditional publications: our annual report, covering our business and financial results, and our corporate responsibility report, focused on our broad-based social and environmental goals, activities, and impacts. This, our first integrated Lilly endorses the principles of the More information about the report, covers our performance in 2015. About this report United Nations Global Compact UNGC can be found at: In creating this report, we con- (UNGC), a strategic policy initiative www.unglobalcompact.org. We are making this change to better for businesses that are commit- sulted the International Integrated We welcome feedback on this ted to aligning their operations capture the ways that Lilly’s business Reporting Council (IIRC) guidelines, report, as it will help us to improve and strategies with 10 universally performance and research progress, as well as the Global Reporting future reports. accepted principles in the areas coupled with our corporate responsibility Initiative (GRI) G4 reporting guide- of human rights, labor, the envi- Please contact: activities, create value for our lines. While this report is not being produced in accordance with ronment, and anti-corruption. This Robert Smith, Senior Director, stakeholders over time. We believe this G4, we have included an index, report describes our activities in Corporate Responsibility, and approach will streamline our reporting, showing which G4 indicators are these areas, and also serves as President, The Eli Lilly and while providing a richer picture of our covered in this report and other our annual Communication on Company Foundation company and how we operate. public documents. More informa- Progress, as required for all com- panies that endorse the UNGC. An Email: [email protected] tion about the GRI can be found at Phone: 317-276-2000 www.globalreporting.org. index to the UNGC indicators in this report can be found on page 134.
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How Lilly Creates Value Lilly's Circles of Value More and more, businesses are talking about different types of capital—not just financial, but social, natural, and human capital, among others. There is also an emerging shift away from a strict focus on short-term thinking to longer-term thinking. This conversation is really a discussion about value, both intrinsic and manufactured, received and created. As the world becomes increasingly crowded and medical challenges mount, so do the questions being asked of the pharmaceutical industry. How can we meet the Receive Create health needs of greater numbers of people? How can we Social Capital accelerate the development of new medicines? How can Natural Capital Manufactured we ensure we have the right people, with the right skills, Intellectual Capital working to find the next breakthrough therapies? How Human Capital Capital can we encourage collaboration to address serious health Financial Capital challenges and enhance access to high-quality care for people around the world? Among those asking these questions are people who have a stake in Lilly’s business—including patients, customers, physicians, our shareholders, the communities where we operate, and our employees who make our work possible. At Lilly, we believe that it’s essential to take the long-term view to these questions. This report paints a picture of how we think about our role in an interconnected world, As a global enterprise, Lilly is both a consumer and a creator of many forms of capital. Medicines play an important role in helping to and highlights key aspects of our commitment to operating make life better for people. By bringing medicines to those who need them, we create both economic and societal value. In turn, this with integrity, excellence, and respect for people. enables us to extend our reach and deepen the impact of our other activities.
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Natural Capital: Social Capital: Our Promise Our company is about caring for people. From the products we make to the communities and Our World causes we support, we strive to ensure that the experiences people have with us are positive. Lilly relies on the use of valuable natural resources, Though we might differ in our individual perspectives, we are joined together by common values— such as energy, water, and raw materials, as well as test integrity, excellence, and respect for people—that have guided our collective actions for more animals and cellular cultures, to conduct research and than a century. Whenever we make a decision that affects others, we strive to do it in a way that manufacture medicines. is consistent with our values.
VALUE TO LILLY VALUE CREATED FOR SOCIETY We recognize the benefits that we draw from the natural The role of medicines in making life better extends well beyond the people who use them directly. ecosystem, without which we could not operate our business. By helping people prevent and manage disease, medicines can reduce overall health spending, We understand the importance of maintaining the vitality enhance productivity, and improve public health and human well-being. Families, caregivers, the and abundance of these resources, not only for our own broader healthcare system, the global economy, and society all benefit. operations but also for the health of other people and com- Around the world, Lilly makes investments and collaborates with others to support better munities that also rely upon these resources. and more sustainable access to quality health care and medicines, especially in places with constrained resources. Beyond providing medicines, we offer information, resources, and encouragement to people struggling with disease. These programs can help to improve health Human Capital: outcomes and make a measurable difference in the lives of patients and their families. We also seek to positively influence quality of life beyond physical health. We work to Our People strengthen civic and community networks, protect safety nets for those in need, promote diversity and inclusion, and champion volunteerism and philanthropy. We also advocate The people who work at Lilly make everything we do for stronger educational opportunities for disadvantaged children, as well as for science, possible—from the research, manufacture, and sale of our technology, math, and engineering (STEM) education. medicines, to the support of local communities and global health initiatives. VALUE TO LILLY The health of community life directly impacts the health of our business. The collective efforts of VALUE TO LILLY Lilly’s patient support programs, community engagement and philanthropic activities enhance and It takes people, committed to excellence and teamwork, to enrich the quality of life where we do business across the globe and in our home state of Indiana. achieve success in the competitive pharmaceutical indus- Our reputation as a caring corporate citizen makes Lilly a welcoming partner for customers and try. Through their collective efforts, Lilly employees fulfill helps us attract and retain talent. Our focus on STEM education helps to build the pipeline of talent our company’s purpose to make life better. We draw on our we need to compete in our industry. Wherever in the world we operate, our focus on community employees’ strengths, talents, dedication, and commit- participation helps us to better understand the needs of the patients we serve, the context of their lives, ment, to discover and develop new medicines, to improve and our role in collaborating with others—including academia, government, and the nonprofit sector— the understanding and management of disease, and to to enhance the quality of life and health for people. support people with serious illness and their families.
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Intellectual Capital: Financial Capital: Our Expertise Our Profits As an enterprise that generates value from ideas, Lilly maintains and safeguards the critical information we gather through painstaking analysis during the drug Lilly brings economic value to shareholders, employees and communities. To development process. We also help to advance medical science more broadly shareholders, we deliver dividends and other returns; to employees, we offer by learning and sharing information about disease pathways and human biology jobs and benefits; and to communities, we provide a revenue base by remitting through our research publications. taxes and investing in infrastructure and research and development (R&D). VALUE CREATED FOR SOCIETY VALUE CREATED FOR SOCIETY The public is able to enjoy the benefits of our medicines only after extensive pre- The profits that we make through the sales of our products enable us to reward clinical and clinical trials generate relevant data demonstrating safety, quality, and the work of our employees, to reinvest in R&D to address unmet medical needs, efficacy to the satisfaction of regulatory authorities and our own high standards. and to benefit people and communities. We employ more than 41,000 people, Lilly is legally required to produce this proprietary data, and we invest our time and mostly in highly skilled jobs, and support many thousands of additional jobs at considerable expense to ensure our products meet the high-quality standards our suppliers and business partners. We return over $2 billion in cash annually our customers expect of us. We’re committed to advancing the global body of through dividends and we strive to generate long-term growth in our share scientific knowledge, working within a strong framework of bioethics, with a com- price for our shareholders. Our profits allow us to fund many other efforts to mitment to patient safety and excellence. make life better, including our patient assistance programs, our global health initiatives, our efforts to stem the tide of counterfeit medicines, and our global VALUE TO LILLY philanthropy. We sponsor and support medical research for the purpose of answering scientific VALUE TO LILLY questions that are important to the development of new medicines and relevant to our customers. The profits that we make through the sales of our products enable us to hire qualified talent, manufacture and market our products, and reinvest in our business through R&D and capital expenditures.
Manufactured Capital: VALUE CREATED FOR SOCIETY When used appropriately medicines can help people live longer and healthier lives, slow Our Products the progression of disease, improve management of chronic conditions, enhance quality At Lilly, the most important thing we do is discover of life, prevent or minimize complications and side effects of disease, or even eliminate and develop innovative medicines that make life the need for costly or painful hospitalizations and surgeries. When compared with other better for people around the world. healthcare interventions, medicines are by far one of the most cost effective.
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Bureau Veritas provided indepen- example, energy use, GHG emis- Scope, Data dent, third-party verification of sions (except scope 3), and Stakeholder greenhouse gas (GHG) emissions water-use data are reported on and Assurance data for scopes 1, 2, and 3. Bureau an adjusted basis accounting for Engagement Data and other updates contained in Veritas also verified the percent- mergers, acquisitions, and dives- Our engagement with a wide range this report are focused on the 2015 age decrease from 2012 (when titures, as appropriate, to ensure of stakeholder groups provides calendar year and include global that is the goal baseline year) and comparability, unless stated other- a basis for developing innovative operations, including wholly-owned from 2014 (in all cases) compared wise, per the GHG Protocol. Our medicines and enhances our subsidiaries, unless otherwise to 2015 for the following metrics: global health, safety, and environ- collective ability to improve patient noted. We also discuss data and energy efficiency, waste to landfill, ment management system is cer- outcomes, both of which are trends from previous years, where waste efficiency, recycling rate, tified by an independent, accredited important to our business. Lilly relevant, and include some sig- water intake, and phosphorus auditor in accordance with the engages with a broad range of nificant events and initiatives that discharge. Otherwise, the content American Chemistry Council’s stakeholders on an ongoing basis, occurred in early 2016. This report and data in this report have not Responsible Care Management through both formal and informal does not include data on joint ven- been externally verified. System requirements. communication channels. Partici- tures, partially owned subsidiaries, To ensure appropriateness and pating in dialogue and partnerships or outsourced operations. accuracy, Lilly follows structured with groups beyond our own company allows us to understand Our consolidated financial state- processes to collect, evaluate, and different viewpoints, explain our ments, which have been prepared calculate the data we report. In positions, and address differences according to U.S. generally deciding what data to collect when they arise. accepted accounting principles and report relating to corporate (GAAP), are subject to our own responsibility matters, we consider We approach these discussions internal accounting systems and external guidelines such as those through several departments controls and have been audited by issued by the GHG Protocol, devel- within Lilly: investor relations; Ernst & Young LLP, an independent, oped by World Resources Institute public policy; government affairs; registered public accounting firm. (WRI) and World Business Council advocacy; health, safety, and (All dollar amounts given are in on Sustainable Development environment; and communications. U.S. dollars.) (WBCSD), and the GRI. For This integrated report and our company website are also part of that stakeholder dialogue.
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Stakeholder Groups and Examples of Engagement Channels Investors Non-Governmental Organizations Daily interactions through our investor Partnerships to support patients Healthcare Professionals Patients relations function and families Online medical information resources Healthcare provider discussions Industry investor conferences Partnerships to raise awareness about Disease-state educational programs Educational materials and programs Meetings in Indianapolis and certain diseases Advisory boards Product package inserts and major global cities Advisory board participation Sales force interactions medication guides Quarterly earnings communications Participation in annual conferences/ exhibitions Direct-mail communications Patient advocacy groups Annual meeting of shareholders Annual report and other financial disclosures Company communications The Lilly Answers Center telephone line Patient support and assistance programs Memberships Medication guides and package inserts Online product resources Periodic investment community update meetings Online registries The Lilly Answers Center telephone line Government and Regulatory Corporate governance discussions facilitated Organizations Publications (manuscripts, posters, and Public and Private Healthcare by the corporate secretary’s office abstracts) Administrators Policy education materials Suppliers Medical letters Account-manager interactions Published policy research Green procurement program Patient support programs Disease-state educational programs Responses to written requests for Product stewardship standard information Lilly-sponsored symposia and scientific Advisory boards exchange meetings Supplier self-assessments and Oral and written testimony The Lilly Answers Center telephone line Medical and commercial booths at qualifications Written comments on proposed regulations Online medical information resources congresses Supplier audits that Lilly performs Policy discussions Interactions with Lilly physicians, Community Members Supplier risk-assessment process Advisory boards scientists, and medical liaisons Employee service on boards and Policy advocacy conversations with vendors Meetings and conferences Clinical trial investigation contracting committees of local organizations Employees1 Communication of studies Lilly-sponsored mobile applications that Participation in local volunteer Lobbying activities provide physicians with easy-to-access opportunities Live “global town hall” meetings Educational briefings research and clinical trial information Employee-directed philanthropy Intranet social collaboration/networking tools, including CEO blog Direct legislator and policy-maker Employee resource groups engagement
Employee surveys 1 Approximately 41,000 employees as of With strong roots in minimizing risk, facilitating governance, and strengthening relationships, December 31, 2015. our Office of Alliance Management has been conducting “Voice of Alliance” surveys for the past Electronic newsletters 15 years. Data is regularly collected from Lilly and alliance partner employees to assess the Hotline for ethics, compliance, and privacy strategic, cultural, and operational fit of each partnership and determine how the collaborations questions/concerns can be improved.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 16 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact Business Review
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 17 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
In January 2015, having successfully Grow revenue. Having weathered product. In addition, we achieved Expand margins. As a result of navigated through a multiyear period the brunt of the U.S. Cymbalta® growth in Humalog® and other lower expenses and higher other ® of patent expirations on major Lilly and Evista patent expirations, established products, including income, earnings per share in- and despite unprecedented cur- Erbitux® following the transfer creased 13 percent to $3.43 on a products, we outlined our refined rency headwinds driven by the of commercialization rights in non-GAAP basis, which excludes strategic focus for a new era for continued strength of the U.S. North America. These worldwide adjustments totaling $1.17 per Eli Lilly and Company. dollar, in 2015, Lilly reported increases were partially offset by share. Reported earnings per share revenue growth of 2 percent to the residual impact of the loss of increased 1 percent to $2.26. (For We said that our objectives were to: $19.96 billion—driven primarily by exclusivity for Cymbalta and Evista. information on the items that were the acquisition of Novartis Animal adjusted for purposes of non-GAAP • Resume revenue growth; Going forward, we expect recent Health in January 2015. financial measures, please see the and future product launches to sup- • Expand margins; 2015 Financial Highlights in the We saw encouraging results port continued performance growth. 2015 Annual Report.) • Sustain the flow of innovation; and from newly launched products, Highlights in 2015 for our human including Cyramza®, Trulicity®, Operating expenses—defined as • Deploy capital to create value, which pharmaceuticals and animal and—with our partner Boehringer the sum of research and develop- includes returning excess cash to health businesses follow later in Ingelheim—Jardiance® and ment, and marketing, selling, and shareholders via both dividends and this section. Basaglar®, our insulin glargine administrative expenses—declined share repurchases. In 2015, we made good progress on PRODUCT REVENUE GROWTH REVENUE PER EMPLOYEE each of these objectives. (For our complete financial filings, $308.2 +6% -8% +3% please see our 2015 Annual Report.) $238.5 $218.8 $218.7 -18% -3%
$145.9 $130.7 $89.2 $638 $590 $609 $501 $484 $56.7 $19.7 $26.3 ($ thousands, percent growth)($ thousands, percent 2011 2012 2013 2014 2015 ($ in millions represent growth in revenue) ($ in millions represent Cyramza Trulicity Humalog Cialis Forteo Other new diabetes products* Excluding impact of exchange rates Including impact of exchange rates In 2015, revenue per employee decreased 3 percent Five products—Cyramza, Trulicity, Humalog, Cialis, and Forteo—together generated revenue growth of to $484,000, primarily due to the impact of exchange $1.1 billion excluding the impact of exchange rates, driven primarily by volume increases. In addition, the rates on revenue and a slight increase in the total acquisition of Novartis Animal Health on January 1, 2015, generated revenue growth of $1 billion. This workforce compared to the prior year. growth was offset in part by Cymbalta and Evista patent expirations. * Includes Trajenta, Jardiance, and Basaglar.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 18 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
through the first three quarters of 2015; much of the increase in Key events in 2015 fourth-quarter operating expenses was driven by charges associated Potential Phase III initiations: Potential regulatory submissions: with terminations of the evacetrapib Olaratumab for soft tissue sarcoma Ramucirumab for second-line metastatic colorectal cancer and basal insulin peglispro devel- Ramucirumab for first-line gastric cancer (US/EU/Japan) opment programs. We remain on Ramucirumab for first-line EGFR mutation Ramucirumab for second-line NSCLC (Europe/Japan) track to achieve our goal of reduc- positive non-small cell lung cancer Basal insulin peglispro for type 1 and type 2 diabetes (terminated) ing operating expenses to 50 per- Ramucirumab for second-line urothelial cancer Empagliflozin/linagliptin FDC for type 2 diabetes** (EU) cent or less of revenues in 2018. Ramucirumab for second-line hepatocelluar Ixekizumab for psoriasis (US/EU) cancer Ixekizumab for psoriasis and psoriatic arthritis (Japan) Sustain the flow of innovation. CGRP MAb for cluster headache Baricitinib for rheumatoid arthritis (occurred in early 2016) In 2015, we continued to make Tanezumab for pain* excellent progress advancing our Olaratumab for soft tissue sarcoma (US) (rolling submission initiated) pipeline. At the beginning of each Potential Phase III data internal readouts: Potential regulatory actions: year, we share with our investors Jardiance CV outcomes trial for type 2 diabetes** a list of key upcoming events— Ramucirumab for second-line gastric cancer (Japan) Ixekizumab for psoriatic arthritis including potential Phase III1 Ramucirumab for second-line metastatic colorectal cancer (US) starts, data readouts, regulatory Remaining trials of baricitinib in rheumatoid Necitumumab for first-line squamous NSCLC (US) arthritis Dulaglutide for type 2 diabetes (Japan) submissions, and approvals—as (BUILD – Feb; BEGIN – Sept; BEAM – Oct) Humalog U-200 Kwikpen for type 1 and type 2 diabetes (US) a basis for monitoring our prog- Evacetrapib ACCELERATE trial (terminated) ress. The list of key events for 2015 Empagliflozin/linagliptin FDC for type 2 diabetes** (US) can be found nearby. The number Potential Phase III data external disclosures: Empagliflozin/metformin IR FDC for type 2 diabetes** (US/EU) of green checkmarks on the list, Ramucirumab for second-line metastatic Basaglar (insulin glargine injection) for diabetes (US final approval) indicating positive outcomes or colorectal cancer Other: achievements, underscores our Basal insulin peglispro for type 1 and type 2 success during the year. diabetes Complete acquisition of Novartis Animal Health ** * Highlights include publication of Jardiance CV outcomes trial for type 2 diabetes Partial clinical hold resolution for tanezumab ® positive cardiovascular outcomes Ixekizumab for psoriasis Rulings in ongoing Alimta patent litigation: data on Jardiance, presentation of Ixekizumab for psoriatic arthritis European Patent Office (Nov) Baricitinib in rheumatoid arthritis U.S. Two-year data from the EXPEDITION-EXT Germany 1 Clinical trials are conducted in a series (extension) study of solanezumab in Alzheimer’s of steps, called phases, and each phase UK disease (I-IV) is designed to answer a separate Japan research question. To learn more, visit * In collaboration with Pfizer. www.nlm.nih.gov/services/ctphases.html. ** In collaboration with Boehringer Ingelheim.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 19 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
four positive studies on baricitinib We also continued to make “YZ” period of patent expirations, in rheumatoid arthritis, the strong significant investments in our own Lilly’s total shareholder return Human Pharmaceuticals: Phase III data and submission of research and development footprint, has placed in the upper quartile ixekizumab in psoriasis, approval including expanding our presence in of performance versus our major Progress Across Our of necitumumab in lung cancer, and leading U.S. research centers. competitors. a series of approvals in diabetes. Portfolio • In Cambridge, Massachusetts, The company’s progress toward Our clinical development pipeline Over the past year, Lilly has we opened our Innovation Center our goals in 2015 was achieved in can be found in the Advancing Med- launched new medicines and for Delivery and Device R&D. the face of ongoing challenges in ical Science section of this report. sustained progress in the pipeline the business environment, includ- • In San Diego, an expansion of across our human pharmaceuti- Deploy capital to create value. ing chronic weakness in the global our Biotechnology Center, to be cals portfolio. In January 2015, we outlined our completed later this year, will economy, a significant slowdown in priorities for deploying capital. almost double Lilly’s research China, and continued pricing pres- In diabetes, since mid-2014, we’ve Our board and management team presence there. sures in the United States and other launched Trulicity, Humalog U200 remain committed to investing established markets. In addition, KwikPen®, and—with Boehringer • In New York City, we’re growing appropriately to grow our busi- we continue to deal with important Ingelheim—Jardiance, Glyxambi®, our presence at the Alexandria ness—in our existing commercial policy issues—from healthcare Synjardy®, and Basaglar. In doing Center for Life Science, with and pipeline opportunities, as well reform, to intellectual-property so, we’ve effectively built out the the expansion to include an as through external innovation— protection, to taxation and trade— most complete portfolio of diabe- immuno-oncology hub. and rewarding our shareholders in the United States and countries tes products in the industry, even by returning excess cash through • And in Indianapolis, we’re around the world. without basal insulin peglispro, for dividends and share repurchases. constructing a $70 million which we ceased development in Yet, despite these challenges, Lilly multidisciplinary lab building December 2015. In fact, according to In 2015, we engaged in a wide enters the post-YZ era in a position at our process and product IMS Health, as we entered 2016, Lilly range of licensing, collabora- of strength—with launches under- development complex. was gaining market share in every tion, asset acquisition, and equity way and important science being diabetes product category in the transactions to access molecules, In each of the past two years, we done in our labs. We remain very United States, Europe, and Japan. as well as diagnostics and tech- have increased our quarterly div- optimistic about the opportunity idend by 2 percent, and, in 2015, nologies, across our therapeutic before us to improve patients’ lives Some recent highlights: categories and business areas. we repurchased approximately and create value for shareholders. $750 million in Lilly shares. Since • In October, we announced that December 2009, when we out- Lilly acquired worldwide rights lined our strategy for the so-called to Locemia Solutions’ nasal glucagon, a potential treatment
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 20 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
for severe hypoglycemia in people In oncology, we have the potential with diabetes treated with insulin, for four launches of new molecu- currently in Phase III. Phase III lar entities in the five–year period testing could also begin this year 2014–2018. In just over one year, for an ultra-rapid insulin. Cyramza gained U.S. approvals • As 2015 ended, we received for four indications in three of the approval from the U.S. Food and most common and deadly can- Drug Administration (FDA) for cers, with approvals and launches Basaglar, with U.S. launch set for in a number of other global mar- December 2016, as well as FDA kets as well. Following FDA ap- approval for the Humulin® proval in November, we launched ™ R U-500 KwikPen. Portrazza (necitumumab) in the United States for first-line treat- • In January 2016, along with ment of metastatic squamous Boehringer Ingelheim, we an- non-small cell lung cancer (NS- nounced that the FDA accepted CLC). In early 2016, the European the filing of data from a dedi- Commission approved Portrazza cated cardiovascular outcomes and Cyramza to treat advanced trial of Jardiance in patients with forms of NSCLC and additionally type 2 diabetes at high risk of approved Cyramza to treat meta- cardiovascular (CV) events. The static colorectal cancer. data have also been submit- ted to European regulators. In With regard to Alimta, we could see the trial, Jardiance significantly generic competition in Europe this reduced the risk of the combined year following negative rulings in endpoint of CV death, non-fatal Germany and the United Kingdom. heart attack, or non-fatal stroke We are engaged in ongoing Alimta by 14 percent when added to the patent litigation in the United standard of care. Importantly, the States, Europe, and Japan, and we we’ve initiated our application for Phase III trials in breast and lung risk of CV death was reduced by will continue to vigorously defend olaratumab in soft tissue sarcoma, cancer. And we have a number of 38 percent. Jardiance is the only our intellectual property, which based on strong Phase II data. both large and small molecules in oral diabetes medication to show we believe is valid and would be The FDA has granted Break- development, as well as a growing a significant reduction in both infringed by generic competitors. through Therapy Designation to array of partnerships in the area of cardiovascular risk and cardio- Looking at the pipeline, follow- olaratumab and to abemaciclib, immuno-oncology. vascular death in a dedicated ing discussions with the FDA, our CDK4 and 6 inhibitor in outcomes study.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 21 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
In other therapeutic areas, we an- baricitinib demonstrated superi- two years will help drive growth. ticipate as many as five launches in ority to both methotrexate and Elanco Animal Health: Key recent approvals include five years—most of which could be adalimumab in improving signs Imrestor™, a biotechnology product first or best in class and some that and symptoms of RA. Positioned for Growth that helps manage mastitis—the modify the course of disease on top most common and costly disease In addition to immunology, we In January 2015, we completed of the standard of care. We were in dairy cattle—as well as products also have a clear opportunity our acquisition of Novartis Animal disappointed that evacetrapib failed to protect against heartworm and to establish a strong position in Health, creating in the process a to show efficacy in a Phase III trial ear infection in dogs. Going for- neurodegenerative diseases, new Elanco, now a top-tier player for cardiovascular disease, but even ward, we expect that Elanco will notably in Alzheimer’s disease. in the global animal health busi- after discontinuing development of contribute roughly 15–20 percent While our amyloid-beta antibody, ness—a $23 billion market ex- that molecule, we retain a robust of our revenue, up from 5–6 per- solanezumab, is furthest along pected to grow to $30 billion by portfolio of molecules in immunol- cent historically. in development, we have a robust 2020. Today, Elanco enjoys unprec- ogy, neurodegeneration, and pain. portfolio that goes well beyond edented global reach, with an ex- In immunology, in early 2016, the solanezumab, with potential treat- panded presence in many interna- FDA approved Taltz® (ixekizumab) ments that address both of the key tional markets, and a more diverse to treat psoriasis. In Phase III pathways thought to play a role in product portfolio. And, as part of trials, 87–90 percent of patients Alzheimer’s disease—amyloid-beta Lilly, Elanco is able to take full treated with ixekizumab saw at and tau protein. advantage of our R&D pipeline and least a 75 percent improvement in our global assets and capabilities. We’re also working to establish a their skin clearance at 12 weeks— position in the treatment of various While market headwinds de- and 35–40 percent saw 100 per- pain conditions. We currently have pressed revenues in 2015, Elanco cent clearance at week 12. In two molecules in Phase III testing is well positioned for growth. The January 2016, we submitted —tanezumab, in collaboration with Novartis integration is exceeding baricitinib for review in the United Pfizer, and our CGRP monoclonal expectations for savings, and States and Europe for rheumatoid antibody. planned launches of seven key arthritis (RA). In Phase III trials, innovation projects in the next
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 22 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact Advancing Medical Science
p24 R&D Progress in 2015 p28 Looking Ahead in 2016 p28 Sustaining Innovation p31 Bioethics p34 Transforming Clinical Trials p40 Assuring Quality Medicines
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 23 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Our greatest contribution to society (ixekizumab) for psoriasis, as well COLLABORATION AT 249 MILES UP: is making life better by making R&D Progress as many other major approvals in LILLY IN SPACE medicines that help people live longer, markets around the world. In 2015, Lilly collaborated with the National We made a number of import- healthier, more active lives. All along in 2015 Aeronautics and Space Administration the way, we advance medical science ant regulatory submissions over (NASA) and the Center for the Advancement by learning more about disease the past year. We submitted of Science in Space (CASIS) in an unprec- olaratumab for soft tissue sarcoma edented move—sending Lilly-sponsored pathways and human biology. We 2015 was a year of extraordinary in Europe and initiated our sub- scientific experiments to the International support collaborations and external achievement in advancing medical mission to the U.S. Food and Drug Space Station. The idea initially took flight at partnerships to help us achieve our science at Lilly. Administration (FDA). The FDA has a Lilly event called Innovation Day (iDay)—a research and development (R&D) goals In January, we outlined Lilly’s R&D granted Breakthrough Therapy day dedicated to experimentation, free-flow and build a robust clinical development strategy, focusing our research Designation to olaratumab, as well thinking, and idea exploration created by the pipeline. We’re committed to advancing in human health on three core as to another one of our oncology Product Clinical Design, Development, and Distribution (PCD3) team at Lilly. The PCD3 areas—diabetes, oncology, and molecules—abemaciclib. We sub- the global body of scientific knowledge, team had invited representatives from NASA neurodegeneration—along with mitted baricitinib for rheumatoid working within a strong framework and CASIS to Lilly’s iDay to discuss ideas and two emerging areas—immunology arthritis in the United States, of bioethics, with a commitment to the feasibility of a research connection. and pain—based on research Europe, and Japan. And, in collab- patient safety and excellence. opportunities and clinical data. oration with Boehringer Ingelheim, Any experiments proposed were subject to In each of these areas, we have we submitted empagliflozin in three criteria: combination with the extended compelling assets and growing or • They must be of value to Lilly. already deep expertise. release formulation of metformin to U.S. regulators. • They must be of value to NASA. In the year that followed, Lilly • They must benefit humankind. The year was also marked by a made significant progress across The experiments chosen cluster around the series of positive data readouts: these areas—demonstrated by the general concepts of crystallization, freeze following highlights through the • Jardiance®, the SGLT-2 inhib- drying, and the mixing of solids, liquids, and first quarter of 2016. itor for type 2 diabetes in our gases. The results should provide insights into the mass production of medical compounds and We received approval for partnership with Boehringer how molecules in discovery and development Portrazza® (necitumumab) for Ingelheim, showed a significant interact with their targets at a molecular level. first-line squamous non-small reduction in both cardiovascular cell lung cancer and for Taltz® risk and cardiovascular death,
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 24 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
the only oral diabetes medication CONTINUOUS INNOVATION INDICATORS FOR CANCER to demonstrate these benefits in an outcome-focused clinical PACE (Patient Access to Cancer care Excellence) is a Lilly Oncology initiative and a global collaboration that engages key oncology stakeholders: pa- study. We have submitted this tients, advocates, payers, policymakers, providers, the public, researchers, and politicians. PACE exists to encourage public policies that speed the data to both U.S. and European development of new medicines, assure that cancer treatments respond to the needs and qualities of individual patients, and improve patient access regulators. to the most effective cancer medicines. • In a Phase Ib/II1 study in soft tis- In 2015, we launched the PACE Continuous Innovation Indicators™ (CII). CII is the first evidence-based, customizable online tool to review medical sue sarcoma, olaratumab, when progress made against cancer over time—initially covering 12 cancer types. The purpose of the tool is to inform public policy reforms and other combined with chemotherapy, efforts to accelerate continuous innovation against cancer by helping to paint a better understanding of the value of different cancer treatments. At significantly improved outcomes the heart of CII are thousands of pieces of evidence curated by trained analysts from authoritative, published sources such as clinical trial records when compared to treatment and meta-analyses, observational studies, and historical references. The tool generates summary graphs from which a user can access supporting with chemotherapy alone. The evidence and additional information. Phase Ib/II study results were “We have seen tremendous progress in cancer treatment and care during the past decades, and continuous innovation, with one discovery building the basis for our filings with the on another, is responsible for most of it,” said John C. Lechleiter, Ph.D., Chairman, President, and Chief Executive Officer of Eli Lilly and Company. FDA and European regulators. “To keep the momentum going, we need policies that support continuous innovation, but first we need a deeper understanding of the innovations that • Ixekizumab was statistically have occurred and where we need to be.” superior to placebo in patients To learn more about PACE, visit www.pacenetworkusa.com. To read about other support programs that Lilly Oncology offers, see Patient Programs. with active psoriatic arthritis in a Phase III trial. This follows Phase III trials in psoriasis in adalimumab in improving signs across three pain indications with We also ceased development of which ixekizumab was superior and symptoms of rheumatoid our partner Pfizer. In addition to basal insulin peglispro in order to etanercept on all measures of arthritis. these new molecules, we started to focus R&D resources on other skin clearance. We initiated Phase III studies for many important Phase III trials for potential treatments. molecules already approved or un- • Baricitinib, the oral JAK1 and olaratumab for soft tissue sar- The Lilly pipeline currently in- der regulatory approval, including JAK2 inhibitor we’re developing coma, our CGRP antibody for cludes nearly 50 new molecules in new indications for ixekizumab and with Incyte, demonstrated supe- cluster headache and migraine clinical development. ramucirumab. riority to both methotrexate and prevention, and our Tau imaging agent for Alzheimer’s disease, We terminated development of 1 Clinical trials are conducted in a series while in-licensing nasal glucagon of steps, called phases, and each phase evacetrapib, which showed insuffi- (I-IV) is designed to answer a separate for diabetes. We also started new cient efficacy in a Phase III study in research question. To learn more, visit Phase III studies for tanezumab high-risk cardiovascular disease. www.nlm.nih.gov/services/ctphases.html.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 25 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Select NILEX (Phase II or later) Pipeline of Molecules in Clinical Development New Chemical Entity Including Select New Indications and Line Extensions (NILEX) New Biological Entity Diagnostic Regulatory Review
* Empagliflozin Linagliptin + Ixekizumab Empagliflozin + Baricitinib Ixekizumab The Lilly pipeline currently includes 48 new cardiovascular Metformin XR* Metformin XR* rheumatoid outcomes data diabetes psoriatic arthritis diabetes arthritis psoriasis molecules in clinical development including nine molecules in Phase III or regulatory re- view, 19 in Phase II and 20 in Phase I. Since our Phase III last annual report: eight molecules advanced into Phase I testing, five advanced into Phase Tanezumab* Solanezumab Ramucirumab Ramucirumab Ramucirumab Abemaciclib Empagliflozin* CGRP MAb Tanezumab* preclinical 2nd-line II testing, and four molecules entered Phase NSCLC Type 1 diabetes migraine chronic lower cancer pain Alzheimer’s 2nd-line bladder 1st-line gastric hepatocellular III. These four are: olaratumab, our antibody back pain disease cancer cancer cancer that blocks PDGF receptor-α being studied for Solanezumab the treatment of advanced sarcoma; our CGRP Ramucirumab Tau imaging agent Abemaciclib Nasal Glucagon CGRP MAb Tanezumab* Olaratumab 1st-line NSCLC Alzheimer’s disease breast cancer hypoglycemia cluster headache osteoarthritic pain Alzheimer’s sarcoma antibody being studied for cluster headache disease and migraine; the diagnostic Tau imaging agent; and nasal glucagon licensed from Locemia Phase II Solutions. Two molecules were submitted for regulatory approval: ixekizumab for psoriasis and baricitinib for rheumatoid arthritis. And Baricitinib Baricitinib Abemaciclib Florbenazine BACE - AZD3293* Chk1 inhibitor Edivoxetine Galunisertib PI3 kinase/mTOR Parkinson’s dual inhibitor one new molecule, Portrazza (necitumumab), diabetic psoriasis squamous NSCLC Alzheimer’s cancer CNS disorder cancer nephropathy Disease Imaging disease mesothelioma was approved for marketing. We terminated FGF receptor development of 19 molecules, including two P70S6/AKT inhibitor in Phase III—basal insulin peglispro and Ralimetinib dual inhibitor Merestinib IL-23 MAb BMP-6 MAb Myostatin MAb Ultra-Rapid Insulin Ferroportin MAb cancer cancer cancer cancer ulcerative colitis anemia disuse atrophy diabetes anemia evacetrapib. In addition, we are selectively highlighting 17 molecules being studied for Oxyntomodulin PCSK9 MAb new indications or line extensions (NILEX) that peptide Emibetuzumab CXCR4 peptide cardiovascular inhibitor diabetes cancer disease have advanced to Phase II testing or later. cancer Additional information and updates are available Phase I on the Lilly Interactive Pipeline at www.lilly.com. In 2015, Elanco delivered 60 country-level D1 potentiator Pan-Raf inhibitor BACE inhibitor NOTCH inhibitor BTK inhibitor Pomaglumetad Aß MAb Fab PEG VEGFR1 MAb approvals for 44 new products or projects. Three Alzheimer’s diabetes methionil Alzheimer’s diabetic dementia cancer disease cancer immunology schizophrenia disease nephropathy important approvals in 2015 include Imrestor, for mastitis in dairy cattle; Interceptor Plus, a chewable treatment for heartworm in dogs; and N3pG-Aß MAb Angio 2 MAb IL-21 MAb Blosozumab FGFR3-ADC CXCR1/2L MAb MET/EGFR BAFF/IL-17 hypoglycemia bispecific antibody bispecific antibody Alzheimer’s cancer immunology osteoporosis cancer immunology Osurnia, a novel, more convenient formulation disease cancer immunology to treat otitis externa in dogs. As of December 2015, the Elanco development pipeline includes CSF1R MAb 39 molecules or unique formulations, including diabetes Information is current as of February 14, 2016. The search for new medicines is risky and uncertain, and there cancer 10 in the final phase of development, and 45 mol- are no guarantees. Remaining scientific, regulatory, or commercial hurdles may cause pipeline compounds to ecule expansion or line extension projects, 24 of be delayed or to fail to reach the market. which are in the final phase of development. * Commercial collaboration
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 26 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
A BROAD, DEEP ALZHEIMER'S RESEARCH PROGRAM
Our Alzheimer’s research program focuses on known hallmarks of the disease—amyloid one of the most urgent medical needs of our plaques and tau tangles in the brain—with time. More than 100 years after it was first potential medicines or diagnostics in every described by the German psychiatrist and clinical phase of development. And we con- neuropathologist Alois Alzheimer, there is no tinue to explore new targets and mechanisms treatment available to slow or stop the pro- as the science evolves. gression of this devastating—and ultimately fatal—disease. We recognize the significant Our monoclonal antibody solanezumab burden this illness causes for patients, care- is in Phase III development. In 2012, Lilly givers, and our society, and we are commit- announced top-line results from two Phase ted to finding ways that we can change and III trials of solanezumab in patients with modify the course of the disease. mild-to-moderate Alzheimer’s disease. Primary endpoints, both cognitive and func- Alzheimer’s disease is the sixth-leading tional, were not met in either trial; however, cause of death in the United States. By 2050, in a pre-specified secondary analysis of the number of Americans aged 65 and older pooled data in patients with mild Alzheimer's living with Alzheimer’s disease is expected disease, Lilly found a statistically significant to nearly triple to 13.8 million, and its costs slowing of cognitive decline—a 34 percent began treatment at a later point, further sug- In Phase III is a tau imaging agent, which in the United States alone could surpass reduction in decline in the treated group com- gesting a potential disease-modifying effect. represents the most advanced molecule in our $1 trillion a year, unless there are medical pared to those who received placebo. pipeline aimed at the potential role of tau in During the fourth quarter of 2016, we expect Alzheimer’s disease. breakthroughs to prevent or more effectively initial Phase III data from the EXPEDITION3 treat the disease. These are the first Phase III results for an anti-amyloid beta agent to show a slowing trial of solanezumab in patients with mild Our N3pG antibody is in Phase I. This antibody We believe Lilly is well positioned to lead the of cognitive decline in patients with mild Alzheimer’s disease. selectively targets only deposited plaque in way in the development of new agents to at- Alzheimer’s disease. The results encouraged the brain and is thought to work by binding to In late 2014, Lilly and AstraZeneca announced the plaque and stimulating the body’s natural tack Alzheimer’s disease. Lilly has been com- us to start a third, more enhanced study, an agreement to co-develop and commercialize mitted to Alzheimer’s disease research and EXPEDITION3, that is currently ongoing and clean-up cells, the microglia, to remove it. an oral beta secretase cleaving enzyme Three additional potential treatments for development for more than a quarter century. has become a standard for the field. (BACE) inhibitor, AZD3293. The BACE inhibitor Our programs are based on deep understanding Alzheimer’s disease and dementia, including At the Alzheimer’s Association International is thought to work by reducing the amount of another BACE inhibitor, are in Phase I. of the disease biology, along with expertise amyloid beta proteins produced, so plaque in conducting clinical trials. We’ve explored Conference in July 2015, we presented findings from the two-year extension study accumulation is slowed. This is in contrast In addition to these molecules in our pipeline, countless molecules as potential leads and to solanezumab, which binds to amyloid beta we’ve launched Amyvid in the United States, sponsored clinical trials worldwide involving following the original EXPEDITION and EXPEDITION2 trials of solanezumab. The after it is produced, allowing it to be cleared Japan, and Europe. Amyvid is the first radio- thousands of patients. And we’ve made signifi- before it clumps together to form amyloid active diagnostic agent indicated for brain cant scientific advances over the years. analysis suggested that the treatment effect of solanezumab was preserved in patients plaques. AZD3293 is currently in Phase II imaging of amyloid plaques in patients with Today we have a strong pipeline of potential with mild Alzheimer’s disease who received development, and if an interim safety analysis cognitive impairment who are being evaluated medicines and diagnostics targeting the two solanezumab earlier compared to patients who in the second quarter of 2016 is positive, it for Alzheimer’s disease and other causes of will move into Phase III testing. cognitive decline.
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Our progress in 2015 and our people who need them. Some of Looking Ahead Sustaining strong pipeline today reflect Lilly’s the ways we’re working to accom- unwavering commitment to inno- plish this include the following: vation during the so-called “YZ” • Science-driven adaptive in 2016 Innovation period of patent expirations on key programs that use analytics and products, as we increased our R&D modeling, along with patient investment through the period. input, to design clinical studies Our work in 2015 will continue to A critical strategic objective for We’re maintaining our commit- and make decisions; bear fruit in the year ahead in terms Lilly is to sustain the flow of inno- ment to R&D in 2016, with in- • Patient-centric tools and of potential regulatory approvals, vation, to advance our pipeline of creased investment in discovery approaches that make it easier new submissions, data readouts, potential medicines that meet im- and new and expanded R&D for people to find, enroll, and and movement in the pipeline. portant medical needs and to drive facilities in New York, Boston, San participate in clinical studies; continued growth as currently In addition to FDA approval of Taltz Diego, and Indianapolis. We’ve marketed products lose patent • Continual improvement in the for psoriasis, we anticipate addi- continued to hire experts in key protection. therapeutic areas to further en- quality of our clinical study tional regulatory approvals for designs during a study, rather ixekizumab in 2016, for psoriasis in Lilly has more than 8,000 employees hance the caliber of our research team. And we’re pursuing more than simply evaluating the study Europe and for both psoriasis and devoted to R&D. Our scientists com- design after the fact; and psoriatic arthritis in Japan. bine deep knowledge of human early-stage opportunities through biology, disease, chemistry, and business development. • Ongoing improvements to our Several important trials are on track genomics with computer models chemistry, manufacturing, and to report data in the coming year. and the insights we’ve gained from control processes to ensure a During 2016, we expect initial Phase people affected by disease to iden- Developing Medicines smooth and flexible development III data from the EXPEDITION3 trial tify new potential medicines. Once process. of solanezumab in patients with a molecule is identified, it goes More Quickly Speed in developing new medicines mild Alzheimer’s disease. We also through rigorous tests in our labs, is vitally important to the future anticipate Phase III data this year Our investment in R&D is guided followed by clinical testing at sites of our company. We’ve already for our CGRP monoclonal antibody by a strategic redirection of our all over the world, to understand if seen years trimmed from planned in patients with cluster headache. research focus toward producing it could potentially be effective and development timelines for several And we are expecting Phase II data candidates for clinical development safe when used in humans. During important programs, and we are for abemaciclib, our CDK4 and 6 that possess a higher likelihood to the drug development process, striving to do even more. inhibitor, as a single agent in pa- become medicines that are val- we might conduct 10,000 experi- tients with advanced breast cancer. ued by patients. In addition, we’re ments to find one compound that changing the way we discover and has the potential to become a new develop medicines in order to bring medicine. new treatments even faster to the
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Keytruda across multiple tumor FINDING ALTERNATIVES TO KEEP ANIMALS HEALTHY: THE SCOPE OF THE CHALLENGE Innovative Collaboration types. And in October, we announced 2 Some of the best scientific break- an expansion of our strategic al- In the next few decades, demand for animal protein will climb 60 percent as population increases 3 throughs happen through collabo- liance with Innovent Biologics to and the global middle class expands by three billion people. These numbers are important, ration. Particularly in today’s com- include immuno-oncology bispecific because we’re already overusing the Earth’s resources, consuming about 1.6 times the natural resources we should use in a year.4 Delivering safe, sufficient, affordable protein to feed the plex healthcare environment, we antibodies in China and globally. growing population has never been at greater risk. must be innovative not only in our science, but also in the ways we The welfare of animals we rely upon to provide protein is also at risk. Today, we have emerging work with scientists outside our Promoting Responsible diseases on every continent, including avian influenza in the United States. Beyond that, nearly 3 walls to complement our internal in 4 cattle experience symptoms of respiratory disease5 at some point in their life, and 1 in 6 dairy efforts in finding and developing Use of Antibiotics in cattle experience mastitis6 in their productive life. It is the responsibility of the animal health new medicines. A good example is industry to keep animals healthy and treat the ones that get sick while safeguarding antibiotics Lilly’s Open Innovation Drug Dis- Food-producing Animals for future generations through responsible use. covery program, which provides According to the Centers for Dis- We believe that it is important that regulations or policies do not move faster than available external researchers with a point ease Control and Prevention (CDC), science, which could jeopardize animal health as well as food safety and food security. Setting of entry into Lilly’s drug discovery antibiotic-resistant infections timelines without solutions could be dangerous, compromising animal welfare. Policies that process. sicken at least 2 million people require complete elimination of all antibiotics in animal production aren’t right for the animal, and they aren’t right for the consumer either. We must take a pragmatic approach that doesn’t put Across our therapeutic categories every year, with the vast majority animals at risk. and business areas, we’re also en- of cases occurring in healthcare gaging in selected business develop- settings. But increasingly, public ment efforts. Some recent examples health experts are concerned that Antibiotic resistance occurs natu- health division, are used on farms are collaborations in the immu- the more antibiotics are used, the rally over time, as bacteria de- to help control, prevent and treat no-oncology space. In late 2015, Lilly more likely bacteria will continue velop resistant genes that are then disease in food-producing animals. and Merck announced extension of to evolve and create resistance, passed on to other bacteria. This Elanco believes that it is our in- an existing collaboration to evalu- creating new “superbugs” that can natural process can be magni- dustry's responsibility to keep an- ate the combination of Alimta® with be much harder to treat. fied by the misuse and overuse of imals healthy, treat the ones that Keytruda® in a pivotal Phase III study The concern over the reduced antibiotics. get sick, and safeguard antibiotics in lung cancer, as well as a collabo- for future generations through effectiveness of antibiotics is Antibiotics, including those manu- ration to evaluate abemaciclib with responsible use—creating healthy real and needs to be addressed. factured by Elanco, Lilly’s animal
2 Food & Agriculture Organization (FAO). Development Outlook. OECD Development 5 Wittum, T. E., N. E. Woolen, L. J. Perino, cattle.” J. Am. Vet. Med. Assoc. 209:814– “World Livestock 2011: Livestock in Food Center. Working Paper No. 285. January and E. T. Littledike. 1996. “Relationships 818.8756886. Security.” Rome, 2011. 2010. among treatment for respiratory tract 6 Ruegg, Pamela L. “New Perspectives in 3 Kharas, Homi. “The Emerging Middle 4 www.overshoot.org. Global Footprint disease, pulmonary lesions evident at Udder Health Management.” Vet Clin Food Class in Developing Countries.” Global Network. slaughter and rate of weight gain in feedlot Anim 28 (2012) 149–163.
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food, ensuring the health of peo- In response to the ongoing con- ELANCO’S EIGHT-POINT ANTIBIOTIC STEWARDSHIP PLAN ple, and protecting the planet, versations around responsible a concept we refer to as “One antibiotic use, Elanco announced 1 Act with responsibility globally—not just according to U.S. regulation—by working with Health.” We are committed to a new antibiotic stewardship plan food producers and retailers to provide training and encourage policies that reduce working together with the human, that promotes the responsible use shared-class antibiotic use and increase veterinarian oversight. animal, and environmental health of antibiotics, reduces shared- communities to develop effective, class antibiotic use, and replaces 2 Cease marketing of growth promotion uses for shared-class antibiotics and complete sustainable solutions to the prob- antibiotics with alternatives. This full regulatory change to end growth promotion use of shared-class antibiotics globally lem of antibiotic resistance. includes developing separate types by the end of 2016. of antibiotics for humans and for Of particular concern in the anti- animals. Animal-only antibiotics biotic resistance issue are “shared Help customers eliminate continuous use of shared-class antibiotics for therapy do not create a resistance threat 3 class” antibiotics used in both purposes by providing an alternative. to human health because of their humans and animals. As a result, animal-only designation, mode of the industry, under guidance by action, and spectrum of activity. 4 Eliminate over-the-counter sales of shared-class antibiotics globally—including the U.S. Food and Drug Adminis- injectable products—where veterinarian oversight exists. tration, has voluntarily limited use In 2016, Elanco will host an animal of shared-class antibiotics to the health accountability summit to Eliminate concurrent use of shared-class antibiotics to treat the same disease. therapeutic purposes of treating, provide a progress report on our 5 controlling, and preventing dis- effort to deliver antibiotic alter- eases in animals under the super- natives. Along the way, we will 6 Support veterinary oversight and responsible use, including helping build vision of a veterinarian. collaborate with customers, aca- infrastructure globally. demics, and appropriate regulatory At Elanco, we share the con- authorities, which will include cern over ensuring a sufficient, Develop new animal-only antibiotics. No animal should ever be treated with a shared- establishing an expert advisory 7 healthy food supply. In June 2015, class antibiotic if an animal-only option exists. Animal-only antibiotics optimize animal panel. Finally, Elanco will collabo- welfare without compromising human-use antibiotics. Elanco President Jeff Simmons rate with our industry association participated at the White House and other companies to advance Forum on Antibiotic Stewardship. 8 Create alternatives. Elanco commits to invest two-thirds of our food-animal research this effort as quickly as possible. budget to quickly evaluate 25 candidates and deliver 10 viable non-antibiotic development projects that address diseases where there are few, or no, alternatives to shared-class antibiotics (e.g., respiratory disease and enteric disease in cattle, swine, and poultry, and mastitis in cattle).
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bioethics committee to systemati- These individuals serve as resources Bioethics cally identify, evaluate, and com- Lilly Bioethics for the company and are responsi- municate bioethics issues, and, ble for the program’s development, in 2008, we became one of the Structure and deliverables, and oversight. first pharmaceutical companies to In addition to this full-time effort, Bioethics—which focuses on the create a Bioethics Program with Management employees from across the com- ethics of health care, biomedical dedicated full-time staff. We em- The Lilly Bioethics Program is an pany participate in key bioethics research, and public policy in brace a comprehensive approach independent organizational unit re- program activities beyond their biomedical fields—is becoming an to bioethics and offer a variety of porting to the chief medical officer regular work responsibilities. increasing area of attention for the resources and educational offer- and includes a senior leader and These “extracurricular” activities pharmaceutical industry. ings to help employees navigate full-time staff members with phar- range from senior leaders who en- ethical scenarios and empower More companies are engaging in maceutical industry expertise and gage in a Bioethics Advisory Com- them to apply bioethics principles bioethics deliberation and making specialized training in bioethics. mittee to a network of employees in their daily work. their positions on related issues publicly available—largely because Equally, we believe in contributing LILLY’S COMPANY MISSION, VISION, AND VALUES of increasing transparency in our to, and advocating for, a strong industry, but also because of a bioethics practice across the phar- Bioethics Framework for Human Biomedical Research greater appreciation for the fact that maceutical industry. To help foster Basic Bioethics Principles Essential Elements for Ethical Biomedical Research true bioethics goes beyond legal this wider focus on bioethics, we compliance. Bioethics is the foun- engage external stakeholders Respect for persons Scientific validity dation for many research and devel- through presentations at profes- Beneficence Social value opment regulations, but regulations sional and academic conferences; Non-maleficence Equitable selection of countries/communities cannot address all bioethics issues. publish papers to advance the bio- Justice and participants ethics conversation in the industry We believe that bioethics is an Relationships with investigators and study sites as a whole; post and communicate integral component of corporate Reasonable benefit-risk profile our own bioethics position state- integrity and pharmaceutical Independent ethics review ments; and serve on industry, ac- research and development ex- Incentives for research participants ademic, and government commit- cellence. In 1999, Lilly became Informed consent tees that address bioethics issues one of the first pharmaceutical Fair treatment of research participants related to biomedical research and companies to establish a standing Protection of privacy and confidentiality drug development. Fair access to post-study benefits Public transparency Stakeholder engagement
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throughout the company who work sits within the context of our com- THE LILLY BIOETHICS FRAMEWORK IN ACTION to continually build their knowl- pany’s mission, vision, and values. edge and skills through bioethics The framework doesn’t aim to The primary way for patients to gain access to investigational drugs (prior to commercial activities and projects. Learn more disrupt or contradict established, availability) is through clinical trials. These studies help determine the safety and efficacy of on our Bioethics Program website. foundational concepts of bioethics. medications, and they are medically and ethically necessary to protect and benefit current and Rather, it provides an approach future patients. However, sometimes people who may benefit from a medication are not able to that specifies and compiles a access it. For instance, the drug may still be undergoing study, and the person in need is unable Bioethics Framework sponsor’s bioethical responsibili- to participate in a clinical trial. If the person has already exhausted other medications available ties to multiple stakeholders into to him or her and cannot wait for commercial availability of a new drug, Lilly may consider making Protecting individuals who partic- one resource. the drug available to that person, using what is called “expanded access.” ipate in clinical studies has long The stakes are high. Because of the significant impact on current patients, drug development, been a high priority for our indus- Our framework provides a bio- and future patients, a pharmaceutical company’s decision to grant expanded access must be try to ensure that the benefits of ethical foundation to inform our based not only on regulatory criteria, but also on ethical considerations. Lilly has employed our decisions and actions related to the research are accomplished bioethics framework to proactively identify important factors that impact expanded access deci- with respect for, and minimal risk biomedical research and to inform sions and to develop our bioethics position statement regarding expanded access. For more about to, individual research partici- company positions on bioethical Lilly’s approach, see the Expanding Access to Investigational Medications section of this report. pants and with an overall sense of issues. The framework helps trans- fairness. However, most bioethics late ethical aspirations into action guidance has traditionally focused so that our biomedical research is All of Lilly’s bioethics position on the responsibilities of clinical conducted in a manner that aligns Our Positions on statements are available on our investigators (physicians who con- with broadly accepted ethics princi- Bioethics webpage, including the duct clinical trials) and ethics re- ples and with Lilly’s core values. Current and Emerging two most recent statements we view boards. There has been a lack In 2015, we published two papers published in 2015 regarding scien- of guidance to comprehensively Bioethics Issues related to our bioethics frame- tific publications and presentations. address the bioethical responsibil- work: one that presents the Lilly uses our bioethics framework ities of industry sponsors (such as framework and another that both when conducting ethical analyses Lilly). To fill this void, Lilly instituted explains how we developed and to answer questions for Lilly em- Engaging Employees a Bioethics Framework for Human implemented the framework ployees and to develop bioethics Biomedical Research in 2010. and discusses our four years of positions on relevant and emerging in Bioethics The Lilly Bioethics Framework experience with it. By sharing topics. We have developed a num- We strive to address bioethics consists of four basic principles these publications with external ber of position statements related issues proactively and make bio- and 13 essential elements for con- stakeholders, we hope to stimulate to bioethics issues such as stem ethics discussions more informed ducting ethical human biomedical discussion that benefits the multi- cell research, pediatric medicine, and commonplace throughout research. The entire framework ple parties involved in pharmaceu- and multinational clinical trials, our company. As we involve more tical human biomedical research. among others. employees in bioethics training, we
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 32 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact create a network of specialists and development, but questions Bioethics Week 2015 Participants work through a cur- capable of relating bioethical thinking may also touch on interrelated In 2015, Lilly’s Bioethics Program riculum, participate in bioethics and knowledge back to different aspects of clinical ethics, business and our Animal Research 3Rs program activities, and develop a functional areas across the company. ethics, and organizational ethics. Initiative co-hosted a companywide project to help them respond to Most importantly, we encourage our bioethics issues related to their We have conducted more than 250 week of awards, lectures, presen- employees to adopt ethics-focused functional role in the company and consultations since 2008, when tations, and discussions related to thinking, which is based on values the pharmaceutical industry. This we started collecting metrics, and bioethics. Our goals for the week and principles, in addition to is just one way we’re increasing the have seen rising interest over the were to increase awareness of bio- compliance-focused thinking, number of employees throughout past several years—starting with ethics and its implications for the which is based in legal regulation. Lilly who make bioethics consider- five requests per year in 2008 and pharmaceutical industry and Lilly, This kind of ethics-focused ations a part of their daily work. increasing to approximately one recognize those who have made thinking helps guide employees per week by 2013. Results from a contributions throughout Lilly in when they are faced with a situa- survey conducted by bioethics staff this area, provide employees with tion that is not explicitly covered Ongoing Employee Training indicate that the consultation ser- an opportunity to engage with ex- by regulation, such as continued In 2014, we introduced computer- vice is well regarded and viewed as perts in bioethics, and position Lilly access to an investigational based training courses to provide approachable, helpful, and respon- to proactively address emerging medicine, stem cell research, or an overview of the bioethics pro- sive. The service increases aware- bioethics issues. For more about implications of providing individual gram at Lilly and the resources ness about bioethics, empowers our approach to animal research, results to clinical trial patients. available to help our employees employees to raise bioethics see the Animal Care and Use effectively navigate bioethics issues. concerns, and helps them reason section of this report or visit our The training is mandatory for our through challenging issues. Animal Care and Use webpage. Bioethics Consultations medical directors and clinical Since 1999, the Bioethics Advisory For more information, read “A research physicians and scientists, Committee has offered a consult- Pharmaceutical Bioethics Consul- Bioethics Leadership and we are in the process of ing service, providing a forum for tation Service: Six-Year Descriptive Academy (BELA) expanding the training to help Lilly employees to ask questions Characteristics and Results of a familiarize more employees with Employees who are selected to and seek advice regarding bioeth- Feedback Survey”—an article about our overarching bioethics frame- participate in BELA dedicate a ics and research ethics issues. our experience with consultations work and how it applies to their work. portion of their working time to The primary focus of the consulta- and the benefits we’ve seen as a bioethics training for nine months. tions is pharmaceutical research result of our consultation service.
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Lilly also considers how we can Transforming provide mutual value to others, either by sharing information, as appropriate—for instance, with Clinical Trials patients who can then return to their healthcare providers more informed and empowered by their Clinical trials are foundational to participation in a clinical trial—or our ability to get new medicines by supporting research models to patients. These studies not only that also aid healthcare organi- determine whether treatments are zations’ goals to reduce costs, safe and effective, but often gen- improve clinical outcomes, and erate a wealth of information that increase patient satisfaction. can help to guide further research and potentially help identify future The Lilly TrialGuide website helps patients learn more about clinical trials and what participants can expect. treatments. Of course, for clinical Creating Patient-Centric trials to be successful, we need people to participate. Clinical Trials At Lilly, we want to do everything We’re also working to develop a we can to connect with patients web-based platform that can be To encourage participation in Every medicine in use today went who would be good candidates for customized for each clinical trial. trials, we’ve focused our efforts on through a series of clinical trials. one of our studies. Yet we know that When the platform is complete, understanding the biggest barriers For patients, clinical studies pres- sometimes patients are confused potential participants will be able that prevent or deter people from ent an opportunity to play a more about clinical trials or are simply to use the online interface to get taking part. We then use this crit- active role in disease manage- unable to find a trial suitable to more in-depth information about a ical information to try to improve ment and to contribute to scien- their situation. In response, in particular study to better under- the clinical trial experience— tific advancements for the benefit 2015, we launched Lilly TrialGuide. stand their commitment before including making it easier for pa- of future generations. Watch this This website is devoted to helping agreeing to participate, including tients to find clinical studies, being video to see what the experience patients understand what clinical answers to questions such as these: transparent about trial outcomes, was like for four volunteers who trials are, how they work, and what and increasing the diversity of par- participated in a Lilly study and • What is the timeframe of to expect as a potential participant. ticipants across our studies. We their subsequent realization about the study? It includes a friendly search engine also look for ways to inspire study the importance of clinical research patients can use to find Lilly clinical • How many visits will be required participants to become advocates beyond their own needs. trials for their condition. and how often? for clinical research and encour- age others to enroll in clinical trials. • What should I expect to happen during my visits?
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We created an early version of this those who do participate have a We are working to deliver an PATIENT PARTICIPATION IN tool for our Duchenne muscular positive experience and would easy-to-understand summary of CLINICAL TRIALS dystrophy trial in 2014. We plan consider participating in another clinical trial results for Phase II–IV to roll out an automated platform research study. studies that have received that additional clinical trial teams approval as of October 2015 to Top perceived risks reported by the public Ironically, a majority of patients * can use in 2016. move forward with their intended of joining a trial also do not talk to others about plan of study. These summaries There are numerous reasons why their positive experience. One rea- Possibility of side effects: will be written in patient-friendly people do—and do not—participate son might be that patients aren’t language using simple, everyday 43% in clinical trials. A general lack of armed with the right information. terms; be translated into local lan- awareness among patients In fact, 90 percent of study partic- Possible risks to overall health: guages spoken where the studies regarding their ability to participate ipants say they would like to know 26% take place; and made available for in trials is a major issue. Once the results of the clinical trial they research sites and study partic- patients are aware of a clinical took part in.7 However, 91 percent ipants on Lilly TrialGuide. This trial, several barriers may prevent never hear back from the study resource is in addition to the more Factors most likely to influence a pa- them from enrolling, including fear staff or sponsor.8 We’ve found that technical results that Lilly has tient’s decision to participate in a trial** of side effects, concerns that the patients who participate in clinical been posting on ClinicalTrials.gov new treatment won’t be as good as trials are often ready to become for all of our studies since 2004. If I thought the drug/treatment what they are currently receiving, great advocates for the process, Learn more about our commit- would help me: the possibility of receiving a placebo but the industry has not enabled ment to transparency of clinical 86% treatment, and the extra burden of this. When participants do not trial results in the Ethics and study participation. receive information on a study’s Transparency section. If I thought a study drug might cure me: outcome, they may become disil- People who volunteer for a clinical 84% lusioned about future clinical trial Lilly is committed to providing trial and have a positive experience participation and fail to grasp the education and opening discus- are more likely to adhere to the If my doctor recommended it: role they can play to help advance sion on clinical trials to advance study protocol, complete their 83% medicine. Lilly hopes to activate innovation, raise awareness, and intended study participation, and their advocacy through transpar- encourage participation. Visit the potentially be more positive when * The Center for Information and Study ency with our own studies. Lilly Trials website to learn more talking with others about their on Clinical Research Participation. 2015 and join the conversation. Perceptions & Insights Study: “Report on clinical study experience, which 7 Shalowitz and Miller. 2008. PLoS Medi- Public Perceptions.” ** may speed enrollment in future cine. 5:714-720. The Center for Information and Study on studies. In fact, the majority of 8 Getz et al. 2012. Expert Rev. Clin. Pharma- Clinical Research Participation. 2015 Per- col. 5(2):149-156. ceptions & Insights Study: “Report on the Decision to Participate.”
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This is why it’s critical for Lilly to LILLY EMPLOYEES HELP BUILD DIVERSITY IN CLINICAL TRIALS Increasing Diversity have diverse representation in clinical trials—to gain the insights Many of Lilly’s employees participate in employee resource groups (ERGs). These groups in Clinical Trials necessary to make medicines that provide for personal relationship building and professional networking and serve as a source The impact of disease isn’t the will be the most effective for all of camaraderie, celebration, and support. They also deepen understanding across Lilly that the same for everyone. Research people who use them. differences in heritage, life experience, and culture reflected in our employee base are strengths that make our company dynamic and that increasingly have direct ties to our business impact. has shown that health disparities Unfortunately, minority popula- exist between different ethnic and Two of Lilly’s ERGs have recently played significant roles in programs that are helping to increase tions have historically and consis- the diversity of our clinical trials. racial groups. In the United States, tently been underrepresented in members of minority groups often clinical trials. As a result, import- suffer a disproportionately higher ant information about how medi- Rebuilding Trust With incidence of certain diseases and cines work in minority populations Minority Communities health-related events, such as is not always available. stroke and diabetes, compared Lilly’s longest-standing ERG, the Lilly African with whites. For example, we know In response, Lilly has developed a American Network (AAN), boasts more than that African Americans are almost clinical trial diversity strategy to 800 members. Knowing the need that exists twice as likely to be diagnosed with better understand patient dif- for greater diversity in clinical trials, but also diabetes as non-Hispanic whites, ferences that may affect clinical recognizing a lack of trust within the African and Hispanics are almost twice as outcomes and to help increase the American community around medical research, likely as non-Hispanic whites to be enrollment of racially and ethni- the AAN proposed a collaboration between diagnosed with diabetes.9 Gender cally diverse populations in U.S. Lilly and the National Center for Bioethics plays a role as well—rheumatoid clinical trials. The ultimate goal of in Research and Health Care at Tuskegee arthritis, osteoporosis, multiple our clinical trial diversity strategy University. The focus: to work together to build sclerosis, and certain cancers, is to improve health outcomes for a better understanding of the lack of diversity among other conditions, afflict individual patients. The strategy in clinical trials today and the need for greater women more often than men.10 includes the following actions: African American representation in the clinical trial population to help ensure that African Responses to medicines can vary • Translating patient materials into Americans benefit equitably from advances in depending on a number of factors, Spanish, health research. In late 2015, Lilly signed an including someone’s genetic back- • Providing physician-education agreement with Tuskegee as a direct result of AAN’s work. We are now working with ground, ethnicity, sex, and lifestyle. materials that include back- Tuskegee to develop a comprehensive plan, ground on the different needs of which will include research, education, and 9 Diabetes data from The Office of Minority distinct patient groups, Health. Accessed January 2016. community engagement. 10 PhRMA, “Facts About Diseases/ • Partnering with advocacy organi- Conditions Affecting Women.” Accessed zations to raise awareness about December 2015.
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Expanding Clinical Trials in the Middle East health disparities and the need enrollment in clinical trials when a for diversity in clinical trials, lack of diversity among the physi- Recognizing the important role of global representation in gathering clinical data about our • Actively recruiting investigators cians conducting the trials exists. medications from different regions of the world, our Lilly Africa, Middle East, and Central Asia to work with diverse patient pop- When there is less minority rep- (Lilly AMECA) ERG worked in 2015 to establish key connections between our emerging markets ulations, and resentation among physicians in business area and our global clinical operations group. Late that year, our Global Clinical certain specialties, it makes it even Sourcing Committee endorsed elevating Saudi Arabia as a Tier 1 country for Lilly clinical trials, • Collaborating with researchers more difficult for us to increase which will result in an expansion of clinical research in the area through partnerships with local to find ways to improve trust the diversity of our investigators. investigators, medical schools, and healthcare centers. This policy ultimately will accelerate among minority populations (see the development of new medicines in general and result in bringing innovative medications more “Rebuilding Trust with Minority To help address this issue, Lilly quickly to Saudi Arabia. Communities”). partners with The Center for Drug Development and Clinical Trials The work our Lilly AMECA network did to shine light on this issue and build bridges between all at Roswell Park Cancer Institute the necessary parties played an important role in our decision to move forward, adding to the Training Minority Clinical to conduct workshops that train diversity of representation in our clinical trial portfolio and enriching the process of scientific minority physicians to become inquiry. With the addition of Saudi Arabia, countries in the AMECA region now make up approxi- Trial Investigators clinical trial investigators. Our mately 25 percent of Lilly’s Tier 1 countries. One important variable in increasing the diversity of clinical trials is hope is that by increasing minority For more information about our ERGs, see the Workplace section of this report. increasing the diversity of the physicians’ participation, we will physicians who conduct the trials be able to increase the diversity (called “investigators”). Minority of clinical trial participants and physicians are more likely to care improve clinical research. for minority and non-English The workshops, titled “Reducing speaking patients. Unfortunately, Cancer Disparities through the the proportion of African American Training of a Diverse Workforce,” and Hispanic physicians has not are offered to oncologists across kept pace with population growth the country who hail from minority 11 for these minority groups. Not groups. These training programs, only does this contribute to in- the first of their kind in the phar- equalities in health and health maceutical industry, aspire to care overall, but it can also affect develop a broader base of diverse investigators who understand the 11 JAMA Internal Medicine, “Minority Phy- principles of good clinical trial de- sicians’ Role in the Care of Underserved sign and have the tools to conduct Patients: Diversifying the Physician Work- force May Be Key in Addressing Health trials that are relevant to under- Disparities.” Published December 2013. represented populations. The Lilly AMECA Executive Team. Accessed January 2016.
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Expert faculty help participants how we can replicate it in emerg- identify the challenges of clinical ing markets to involve more local research, particularly in minority physicians in the studies taking and underserved populations, and place in those countries. As we provide advice and education for look to expand our clinical trials how to overcome these challenges more broadly in these regions, through lectures, small break- we’re carefully considering im- 68 out discussions, self-study, and portant ethical questions related 95 48 Sites in the Northeast one-on-one sessions. Participants to post-trial care and availability Sites in the West Sites in the Midwest receive ongoing mentorship from of medications before choosing workshop faculty long after the clinical trial sites. workshops end. In 2014 and 2015, 50 141 we successfully trained a total of 39 minority physicians, and feed- Sites in the Southwest Sites in the Southeast Expanding Access to back from participants has been very positive. We plan to continue Investigational offering the workshops, at a mini- mum, through 2019. Medications Beginning in 2016, participants Patients with life-threatening 29 in this program will benefit from conditions sometimes seek access 7 Sites in Puerto Rico hearing best practices from rep- to medications not yet available Sites in Alaska and Hawaii resentatives of 20 clinical trial to the general public; an example sites we have identified as cen- might be a cancer patient who isn’t ters of excellence for their work responding to currently available DIVERSITY IN LILLY-SPONSORED CLINICAL TRIALS IN NORTH AMERICA (2015 SITES) in increasing diversity in clinical treatments and who is desperately studies. By gathering representa- searching for something to combat To gain greater insight into the effectiveness of potential medications across a diverse popu- tives from these sites together, we his or her illness. These patients lation, Lilly works to increase minority participation in our clinical trials. Our goal is that every hope to advance the conversation have typically tried every approved study conducted with more than 25 clinical trial sites must select at least two sites meeting about how to improve the diversity treatment for their condition, but Lilly’s diversity criteria. of clinical trials across the United nothing has worked. States even further. A diverse clinical trial site means the patient population is greater than 25 percent non-Cauca- Whenever possible, we encour- sian. This map shows the number of sites in North America that meet this goal. Since we began Based on the success of the age patients seeking access to focusing on increasing minority participation in clinical trials, we have added more than 400 new U.S.-based investigator training investigational medications (med- clinical trial sites with minority patient populations of more than 25 percent. program, we’re also considering ications still undergoing study) to
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participate in clinical trials. These from external stakeholders, and the studies are the safest and best cumulative information we’ve gath- opportunity for patients to access a ered from our oncology expanded medicine before it’s been approved access programs, which have pro- for broad use. In addition, robust vided us with important insight into data sets from clinical trials provide this issue. regulatory authorities with essential The decision to offer expanded information they need to evaluate a access is complex. We give careful new medicine and approve it to be- consideration to each request we come more widely available. In this receive—evaluating any alternative way, participation not only benefits therapies available and the bene- the patients, but also contributes to fits and risks of using the investi- greater scientific understanding of gational medication. In addition, we the disease and the specific medi- will only provide expanded access cation being studied. if the medicine is currently being However, sometimes people who studied in humans and if providing may benefit from a medication still the medicine for its requested use undergoing study don’t qualify for will not interfere with the initiation, a clinical trial and have already conduct, or completion of any cur- exhausted all other relevant med- rent or upcoming clinical trials. ications available to treat them. In Lilly has a responsibility to ensure those cases, Lilly may consider pro- that expanded access can be done viding an investigational medicine in a manner that upholds ethical outside of a clinical trial setting. We an individual patient in response principles, such as fairness, pro- of expanded access program is call this “expanded access.” to a physician’s request. This type moting good, and minimizing risk developed in consultation with a of expanded access is managed We have offered expanded ac- of harm for both current and fu- regulatory agency, such as the by the patient’s physician. cess to investigational oncology ture patients. If a specific situation U.S. Food and Drug Administra- drugs on a global scale since the meets all of our criteria, we offer tion (FDA). To learn more, visit our Expanded 1990s. However, in the last few two types of expanded access: • Individual Patient Expanded Access webpage and read Lilly’s years, we have been developing a Access: In rare cases, if a Cohort bioethics position statement on the • Cohort Expanded Access: Lilly more formal position on expanded Expanded Access Program is not Expanded Access of Investigational manages access for a group of access due to our robust pipeline available, Lilly may still decide to Medicines. patients who meet a specific set of medications, increased interest provide investigational medicine to of eligibility criteria. This type
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The LQS is composed of an inte- QUALITY ACROSS THE MEDICATION LIFE CYCLE Assuring Quality grated system of standard busi- ness processes, as well as organi- We work tirelessly to make our medications safe and effective—from the early stages of design zational and governance controls and drug development through ongoing monitoring and understanding of the patient experience Medicines that are designed to assure once a medication is on the market. Attention to detail and rigorous quality control across many high-quality products across both interrelated areas of our company are necessary to ensure a high-quality product. our human health pharmaceutical Lilly was founded by Colonel Eli and animal health (Elanco) divi- Lilly in 1876 at a time when med- sions. Our quality standards often icines were often ineffective and exceed regulatory requirements poorly manufactured. Lilly’s com- for our industry. At Lilly, we seek mitment to quality was ensured in ways to continuously improve our The Lilly Code, which served as the existing manufacturing processes company’s first mission statement and use these findings in the de- in 1899. Today, our quality teams velopment of new medicines. work closely with groups across DESIGN DELIVER MONITOR the company to ensure our medi- cines are both safe and effective. Lilly Global Clinical Development Safety & Efficacy Data Safety Manufacturing Manufacturing & Lilly’s Quality System Product Development Product Complaints The mission of Lilly’s global Distribution At Lilly, we strive to make sound manufacturing team is to provide Market Research Product Information Patient Experience quality decisions that are consistent a reliable supply of high-quality with good science and current reg- medicines. We are committed to ulatory and industry expectations manufacturing medicines that across all areas of our company. meet the following expectations: We do this within the framework Safety: We are committed to en- of the Lilly Quality System (LQS). suring our medicines are manu- The LQS provides the foundational factured in an environment that quality requirements throughout is safe for our employees and the the product research, development, surrounding communities in which manufacturing, and commercial- we operate. ization life cycle (see graphic).
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Quality: We assure the quality of Approximately 10,400 individuals—about 25 percent of our our medicines by developing them Global Patient Safety using good science and manufac- employee base—compose Lilly’s global manufacturing Beginning with the discovery of a turing them within a regulatory potential new medicine, our goal framework that is consistent with organization. The group operates 30 company-owned sites on is to ensure that the benefits and high industry standards. four continents and manages relationships with more than risks of the medicines we market Value: Our global manufacturing are continuously monitored and organization consistently measures 200 contract manufacturing organizations in 45 countries. well-understood by regulators, performance and productivity healthcare providers, and patients based on available information. against stringent standards and LILLY’S WORK TO SECURE THE LEGITIMATE SUPPLY CHAIN12 best practices. We also continu- Lilly’s global patient safety organi- ously strive to improve our prod- zation, consisting of more than 300 For many years, Lilly has used various types of anti-counterfeiting and tamper-evident technolo- physicians, pharmacists, nurses, ucts using good science and Six gies as part of its overall strategy to protect patients. We are also putting applications in place and other professionals, is dedi- Sigma methodology. that meet emerging pharmaceutical “track and trace” or “serialization” standards around the cated to the collection, monitoring, globe. These applications are designed to help patients, pharmacists, and others determine if a Environmental Stewardship: We evaluation, and reporting of safety given medicine is counterfeit or the authentic product. have transformed many of our information. manufacturing processes to im- Serialization, which is the unique identification of individual packs of medications, is a partic- prove our environmental footprint ularly promising technology. As each batch of finished product is packaged, a globally unique in the areas of energy efficiency, serial number is assigned and physically marked on the product’s packaging in both a human Assessing the Benefits and waste minimization, and water readable form and as a two-dimensional barcode. To monitor the movement of individual packages Risks of Medications reduction. Learn more about Lilly’s of medicine through the supply chain, these serial numbers can be recorded and electronically Well before a medicine is approved environmental stewardship. linked to deliveries. These numbers can also be used by the pharmacy to verify that a serial number is valid prior to dispensing a given medicine to patients. by regulatory authorities, it is Our manufacturing employees rigorously assessed through care- take pride in their work, possess To help secure the legitimate supply chain for our products and meet these emerging global fully designed clinical trials to better a high level of technical skill, and requirements, Lilly has invested roughly $100 million to upgrade our packaging operations, distri- understand its benefits (favorable bution centers, and information technology infrastructure around the world. Lilly is already sup- are deeply committed to supplying effects) and risks (unfavorable plying serialized product to multiple markets and will have full capability in late 2016 to supply high-quality medicines to people effects). The results of these studies to additional markets that require serialization. In addition, Lilly is working closely with industry around the world. are shared with regulators around groups, standards organizations, ministries of health, and other government functions to advocate for common serialization standards globally. In our view, these standardization efforts will help the world, such as the FDA in the doctors, pharmacists, and patients around the world trust the legitimacy of the medicines they United States, so they can conduct prescribe, dispense, and receive through this emerging technology. Watch a video to learn more. their own assessment before ap- proving the drug for wider use. 12 The serialization efforts described here apply only to our human pharmaceutical business. This activity is not required for our Elanco division due to the nature of the animal health business.
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When the regulatory agency ap- On its own, however, all of this MANAGING AND MINIMIZING THE RISK OF TAKING MEDICATIONS proves a drug, it concludes that data does not predict whether an the drug’s benefits outweigh its individual patient will specifically The safety information of a medicine is communicated through the medication label, which risks for the conditions outlined benefit from a particular medi- healthcare professionals use to understand the risks prior to prescribing drugs to patients. on the product label and that cine. Once patients begin using the Patients can also refer to the label, or to the less-technical medication guide provided with our there is a public health benefit medication, they are monitored by products, to understand the potential risks associated with taking a specific medication. from the medication. their healthcare professionals to In addition, Lilly develops risk management plans (RMPs) for our medications. The RMP outlines evaluate how the drug actually In addition, we formally evalu- the specific plan to further understand the safety profile of that product. It also outlines, when performs. Even as physicians ate the benefits and risks of our applicable and in addition to information in the label, how Lilly plans to go about minimizing the become experienced at identifying medicines on an ongoing basis most severe known or potential risks that may be associated with the medication. For example, individual patients who will more it may require training for physicians that will teach them what specific actions should be taken throughout their life cycles. Our likely benefit from a specific drug to lessen certain risks. After a drug receives approval and is made available to patients, the RMP benefit-risk assessments take into therapy, it is still not always pos- continues to be updated as additional information becomes available that impacts the safety account new or emerging safety, sible to predict whether the drug profile or benefit-risk balance of the product. Updates are submitted to regulatory authorities. efficacy, and effectiveness informa- will have the expected therapeutic tion, together with existing product benefit or whether side effects will knowledge, to present a structured, occur in an individual patient. Collecting Safety Information clinical trials, Lilly continues to critical analysis of the cumulative carefully monitor for new safety benefit and risk information. Lilly collects, monitors, and eval- Throughout the Life Cycle findings. In fact, the monitoring uates the benefits and risks of our of a Medication increases—through collection of medications and takes steps to Learning how individual patients information from post-marketing BALANCING BENEFITS & RISKS communicate and minimize those react to a medication is essential clinical studies, published scientific OF MEDICATION risks while maximizing benefits to for the ongoing development of articles, adverse event databases, the patients who use them. We play better treatment practices. Often, and spontaneous adverse event an essential role in making sure that side effects can only be observed reports voluntarily submitted by BENEFITS RISKS healthcare professionals have the after a medication has been ap- healthcare professionals and pa- most current safety information so proved and used across a large, tients who are using a medicine. In EFFICACY they can make decisions about how diverse patient population for an addition, we monitor the impact of and when a drug should be used extended period of time. our medications, including reports and how they should monitor pa- CONVENIENCE SAFETY of the following: tients for potential adverse events. For this reason, safety evaluation does not stop when a medication • Outcomes of use of a medica- LIFE EFFECTS TOLERABILITY reaches the market. After the tion during pregnancy (mater- completion of pre-marketing nal and paternal exposure) and breastfeeding
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• Lack of drug effect • Off-label use • Overdose, abuse, and misuse • Medication error • Suspected transmission of infec- tion agents • Potential adverse events associ- ated with product complaints. Lilly collects adverse event reports from all over the world and enters the information into a common electronic database to further evaluate the safety and risks of our medications. New safety findings and emerging concerns are shared openly with regulators and health- care providers to appropriately manage risks associated with the use of our medicines. We also work diligently to combat drug counterfeiting, which poses seri- ous health threats to patients. RESPONSIBLE USE OF MEDICATIONS The Patient Safety section of Lilly’s website is available to educate key Prescription medications are potent products designed to fight illness and promote an improved quality of life. When properly used, prescription external stakeholders about the medications can effectively treat diseases and provide relief from chronic conditions—transforming health and saving lives. Unfortunately, nearly any role the pharmaceutical industry, prescription medication can be misused or abused. When people fail to use these products as prescribed, there is not only a risk of ineffective treatment regulators, physicians, and patients but also a significant potential for harm due to overdose. These safety concerns can be compounded if products are obtained without a prescription or play in ensuring medicines are safe outside of the secure, legitimate supply chain, where counterfeit or adulterated products might be introduced. and effective. Lilly collects and reports misuse and abuse of our products as part of our ongoing efforts to monitor our medications for patient safety. We review these cases on a regular basis and provide reports related to individual cases or in aggregate, depending on the situation, to regulatory authorities. We also partner with organizations, such as Indiana’s Prescription Drug Abuse Prevention Task Force, created by the Indiana Attorney General’s Office, to promote the safe use of prescription medications, and we work with government and non-government agencies to curb misuse and accessibility to counterfeit or other substandard medications.
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PHARMACOVIGILANCE: THE CONTINUOUS MONITORING OF PRODUCT SAFETY
Lilly collects, monitors, and evaluates safety information throughout the life cycle of each medication. This system is designed to maintain and evaluate the product’s benefit/risk profile. When important safety issues arise, Lilly communicates them to doctors, patients, and regulatory agencies in various ways depending on the nature of the adverse event.
Drug Discovery Pre-Approval Clinical Trials Post-Approval Clinical Trials and Real-World Use
Safety Information gathered during Adverse event information Individual adverse event reports from the public, including Data toxicology studies/animal collected and reported patients, healthcare providers, and pharmacists research to Lilly throughout the Post-marketing clinical and non-clinical studies and course of the trials Published information epidemiological studies about drugs in the same Scientific and medical literature pharmacological class
Lilly's Action Create an initial drug safety Update the drug Depending on the nature of the event: profile for use during safety profile Follow-up with doctors and patients to understand reported clinical trials Create summary of safety adverse events information for product Continuous monitoring of reported adverse events to find trends safety label and evaluate key safety issues Collaboration with regulators to share information Updates to product safety label Additional safety communications as necessary Additional post-marketing clinical trials and safety studies
Notifications to regulators
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p46 More than Medicines: Lilly's Commitment to Global Health p48 Lilly Global Health Programs p54 Addressing Diabetes in China: Lilly Expanding Access for People (LEAP) p56 Hunger Relief p59 Product Donations p61 Patient Programs
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 45 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Our primary contribution to global health comes through the medicines that one of the non-communicable we discover, research, and bring to market. But despite the progress made in More than diseases (NCDs) now affecting medical science by Lilly and others over the past few decades, as well as the new hundreds of millions of people, and the Lilly MDR-TB Partnership, medicines, diagnostic tools, and other technical advances that are now available, Medicines: Lilly's begun 13 years ago, focuses on we recognize that too many people still do not have access to quality health care. hard-to-treat multidrug-resistant At Lilly, we have long used traditional philanthropy to help people in immediate Commitment to tuberculosis. Through both programs—working alongside need, and we will continue to do so. But these efforts, vital though they are, are our partners—we research simply no match for the scale of deeply rooted healthcare challenges that affect Global Health community-based models of people around the globe, especially in low- and middle-income countries. We health care, report data, and share recognize that different thinking and new solutions are needed. lessons learned with governments, Lilly product donations help experts, and other decisionmakers Accordingly, our work today in global health is broad and uses a variety of thousands of people each year to inform policymaking and to approaches—from product donations, to public-private partnerships, to a new around the world, especially in advocate for proven, cost-effective initiative based on the concept of shared value aimed at improving diabetes care times of disaster. Our patient in China. Our global health portfolio also includes the hunger relief efforts of assistance programs provide free our animal health division, Elanco. Elanco’s initiatives are closely tied with its or reduced-price medicines to business focus of contributing to a safer, more affordable, and more abundant food those who cannot afford to pay. In 2015, we donated more than $500 supply. Knowing that good nutrition is a key element of good health, Elanco has million in Lilly medicines. SHARED VALUE INITIATIVE chosen to focus on reducing the burden of hunger globally, as well as in our home But we recognize that our re- city of Indianapolis. We are a member of the Shared Value Initiative, sponse must go beyond donating a global community of organizations, including In addition, we support a variety of patient programs around the globe, offering medicines alone—especially in companies, civil society, and government, information and support for those dealing with different disease states and areas where healthcare systems committed to driving the adoption and illnesses. Through these programs, Lilly works with our partners to make struggle to meet the demand implementation of strategies that create for services. Through two flag- healthcare systems more accessible and effective and to educate the newly measurable business value by identifying and ship initiatives, we are working addressing social problems that intersect with diagnosed or those already receiving care, along with their caregivers and families, to address healthcare system business interests. The Lilly NCD Partnership to improve health outcomes. challenges in areas with limited and Lilly Expanding Access for People (LEAP) resources. Our Lilly NCD Partner- are two Lilly initiatives created through a ship currently focuses on diabetes, shared value lens.
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solutions to be adapted, replicated, passion—we can make far greater LILLY'S RESEARCH, REPORT, AND ADVOCATE APPROACH and scaled to benefit more peo- progress, even faster. ple. Our newest initiative in China, By using an evidence-driven approach—Research, Report, and Advocate—in the Lilly NCD Part- To guide our partners and us, we Lilly Expanding Access for People nership and the Lilly MDR-TB Partnership, we are working to amplify the richness, reach, and use an evidence-driven framework (LEAP), combines our diabetes ex- impact of our efforts and to generate lasting value for people, societies, and our company. that we call Research, Report, and pertise with on-the-ground health- Advocate. The goal of this approach We research new models of comprehensive health care, collect robust outcomes data, report care provider training to bring is to develop and demonstrate broadly what works and what doesn’t, and then advocate the replication and scale up of the best effective care for diabetes closer sustainable models of care that solutions to benefit people on a wider scale. We do this by sharing our results with governments to the communities where the ma- improve outcomes for people and and the wider global health community, both globally and in our focus countries. jority of affected people are living. strengthen healthcare systems. Research: pilot models of comprehensive health care with embedded data collection on Our programs collect valuable data health outcomes; that is helping governments and Working in Partnership other key stakeholders to make Report: share health outcomes data and lessons learned with governments, experts, and other decisionmakers to inform policy decision-making; Our global health programs are better-informed healthcare deci- designed and managed in part- sions and to replicate and scale Advocate: use outcomes data to inform decision-making and advocate with our partners for nership with experts and organi- up proven approaches. Ultimately, broader use of proven, cost-effective solutions. zations in the communities where we seek to be a catalyst for ideas, In addition to sharing with governments and health experts, we post our project results online. we operate, each of whom brings solutions, action, and results. unique insights, capabilities, ideas, and passion. We are privileged to work side-by-side with them. To- LILLY GLOBAL HEALTH PROGRAMS: CREATING VALUE FOR PEOPLE, SOCIETIES, AND LILLY gether, we are working to improve access to care, strengthen health- care systems, and support at-risk populations. Our primary goal is What Where How to develop fact-based solutions Developing community-based Working in Brazil, China, India, Using an evidence-driven approach— that improve health outcomes and create lasting value for people, healthcare models to improve health Mexico, Russia, and South Africa, Research, Report, and Advocate—to societies, and Lilly. outcomes, build capacity, and with nearly 50 well-respected global, inform policymakers and bring benefit enable access to quality care for national, and local partners, each con- to as many people as possible Through strategic public-private partnerships—with each orga- people with diabetes or MDR-TB in tributing its own expertise to collec- nization applying its unique in- resource-limited settings tively strengthen healthcare systems sights, capabilities, ideas, and
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 47 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
NCD-related deaths—some 28 IMPROVING ACCESS TO QUALITY CARE WHERE NEEDS ARE GREATEST Lilly Global million a year—occur in low- and middle-income countries. Health Programs The impact of NCDs has emerged as a major challenge in settings where healthcare systems have historically been oriented toward Our global health programs—the care for other priority health- Lilly NCD Partnership and the Lilly care needs, such as infectious MDR-TB Partnership—make life diseases and maternal and child better for people around the world health. Amid scarce resources by increasing sustainable access and competing healthcare sys- to quality care for people with tem demands, many people with diabetes or multidrug-resistant NCDs in these countries are tuberculosis (MDR-TB) in diagnosed late—if at all. And for Lilly NCD Partnerships Lilly MDR-TB Partnerships Both Partnerships resource-limited settings. Learn those who are diagnosed, care more by watching this video. can be highly variable. These dis- Brazil China India Mexico Russia South Africa eases not only take lives but also Diabetes 12M 69M 11M 3M diminish opportunities—as they MDR-TB 51K 62K 36K 26K NCDs—The Leading often affect adults in their prime * Number of cases as of 2014 ** M = million, K = thousand income-earning years. All too Cause of Death often, families face lost income, potentially catastrophic healthcare these diseases. The WHO Global Worldwide expenditures, and, ultimately, the Action Plan for the Prevention Non-communicable diseases loss of loved ones while societies and Control of NCDs 2013–2020 (NCDs)—such as diabetes, car- must bear the costs of care and provides a road map and a menu diovascular disease, cancer, and lost productivity. of policy options for cross-sector chronic respiratory diseases— Following the United Nations collaboration aimed at a 25 per- impact individuals and societies High Level Meeting on NCDs in cent reduction in premature around the world. Accounting for 2011, global health organizations, deaths from NCDs by 2025. We 63 percent of all deaths worldwide, governments, the private sector, at Lilly, and many others, believe VIDEO Lilly Global Health Programs they have particularly devastating and other stakeholders have been that millions of lives can be spared effects in many poor countries. mobilizing to address the human, through meaningful and coordi- In fact, almost three-quarters of financial, and societal toll of nated action.
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South Africa—four countries with The Lilly NCD high rates of diabetes and where significant unmet needs for access Partnership to diabetes care exist. But each $30M Responding to the global NCD of these countries has unique challenges in this area related challenge requires new ways of $30 million commitment Focused on improving diabetes to the structure of its healthcare Launched in 2011 thinking and collaborations on an over 5 years (2012-2016) health outcomes unprecedented scale. Private sec- system and national priorities, so tor organizations, like Lilly, have a we worked with our partners to critical role to play in these efforts. design and implement programs After consulting with key global that address relevant gaps. health stakeholders at the inter- Each of our partners is highly national, national, and local levels, regarded at the local, national, Focusing on 4 countries with Lilly determined that we could pro- Leveraging Lilly's Research, and/or international level and high diabetes and NCD burdens: Partnering with 7 leading global Report, and Advocate vide the greatest contribution by fo- brings critical capabilities and Brazil, India, Mexico, health organizations framework cusing on diabetes. For more than expertise. Through our annual South Africa 90 years, Lilly has been a world- Lilly NCD Partnership summit, wide leader in pioneering diabetes we actively share approaches, OUR PARTNERS solutions. Given our history, deep findings, and outcomes that allow expertise, and current product our partners and us to continually portfolio and pipeline, diabetes was learn from one another. a natural choice as the focus of the Lilly NCD Partnership. In 2011, we launched the Lilly NCD Partnership 2015 NCD Partnership Highlights with an initial five-year commit- • Improved access to quality care for ment of $30 million. diabetes in Mexico: Use of insulin Today, we are partnering with increased by 30 percent or more Brazil India Mexico South Africa seven leading health organiza- in two states where the CASALUD Public Health Carlos Slim Donald Woods model was implemented by Institute for Children tions in Brazil, India, Mexico, and with Diabetes Foundation of India Foundation Foundation our partner the Carlos Slim Foundation, as healthcare provid- Medical Foundation Population Services Project HOPE ers developed better capacity to of Rio Grande do Sul - International initiate and manage patients who Federal University of Project HOPE were previously poorly controlled Rio Grande do Sul on oral medicines.
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• Increased identification of diabetes “In the early 1990s, it had basically been declared that MDR-TB and hypertension cases in India: The Lilly MDR-TB Through the UDAY campaign, run Partnership couldn’t be treated in developing countries. Partners In Health by our partner the Public Health began treating patients in the slums of Peru, and we were able Foundation of India, with sup- Tuberculosis (TB), often mistaken port from Population Services as a disease of the past, continues to show that you can treat it. And then we realized that one of International and Project HOPE, to plague millions of people around more than 50,000 people have the world. While preventable and the problems was high drug prices. So we went to Eli Lilly and been screened for diabetes and curable, TB ranks alongside HIV as Company, and those guys were incredible. They actually helped hypertension, 13,500 of whom the leading cause of death from an were referred for treatment. infectious cause worldwide, with us lower the price of the drugs for drug-resistant TB from about A detailed mapping has been 1.5 million deaths in 2014. When $30,000 a year to about $1,000 a year. And we actually convinced completed in the two commu- left untreated or under-treated, nities where UDAY is based—a TB can spread rapidly and evolve the world to lift this death sentence and treat drug-resistant TB.” first-ever achievement increas- into drug-resistant forms. In – Dr. Jim Yong Kim, M.D., Ph.D., President, The World Bank Group, formerly with Partners In Health ing understanding of how envi- 2014, the World Health Organi- ronmental factors (e.g., access to zation (WHO) reported 480,000 open space, the location of health new cases of multidrug-resistant facilities and pharmacies, as well TB (MDR-TB)—which is harder to as the location of fast-food out- diagnose and treat than drug- lets and tobacco outlets) impact sensitive TB and which has signifi- the well-being of populations at cantly poorer cure rates. Adding to risk for diabetes. the problem, each year an esti- • Scaling up type 1 diabetes care mated 3 million people with TB are in Brazil: The juvenile diabetes “missed” by healthcare systems education course developed in that fail to accurately diagnose our partnership with the Institute and treat them. for Children with Diabetes is Lilly has been actively working poised for national scale up to to stem the tide of MDR-TB for reach thousands more children with diabetes. Plans for the next phase of the Lilly NCD Partnership will be announced in late 2016.
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more than a decade. Partnering of the first companies to mass LILLY MDR-TB PARTNERSHIP PHASES with global, national, and local TB produce penicillin. Throughout stakeholders around the world, we the 20th century, Lilly launched Phase I (2003–2007): Launched in 2003 with an initial commitment of $70 million, the Lilly have targeted our efforts, including a number of antibiotics, including MDR-TB Partnership sought to reduce the burden of MDR-TB by transferring the technology these, for the greatest impact: two TB antibiotics, capreomycin needed to manufacture medicines and by elevating awareness of MDR-TB on the global stage. and cycloserine. As TB cases • Healthcare provider training In 2007, Lilly expanded the duration and scope for the Lilly MDR-TB Part- waned in the late 1980s and early Phase II (2007–2011): and healthcare systems nership by committing an additional $50 million to the collaboration to complete the technology 1990s, demand dwindled for many strengthening; transfer and to further strengthen awareness, prevention, and care. We also committed another TB medicines. $20 million for early drug discovery efforts. • Improved access to safe, effective TB medicines; and By the late 1990s, however, MDR-TB Phase I & II key accomplishments: arose as a significant global health • TB medicine discovery. issue with few therapy options. • Transferred Lilly antibiotic manufacturing technology to seven companies to increase avail- In close collaboration with gov- After independent researchers ability of MDR-TB medicines and improve standards of care ernment and healthcare organiza- found that capreomycin and • Launched the Lilly TB Drug Discovery Initiative tions, the Lilly MDR-TB Partnership cycloserine were effective as part • Provided $20 million in funding for TB drug discovery focuses on countries with the of a broader “cocktail” of medicines • Strengthened the capacity of more than 100,000 healthcare professionals to better highest MDR-TB burdens: China, in treating multidrug-resistant recognize, diagnose, and treat MDR-TB and to provide care and support to people with India, Russia, and South Africa. TB, Lilly doubled production and MDR-TB and their families While our programs are primarily subsidized prices of the medicines. • Distributed guidelines and toolkits to more than 45,000 hospitals and clinics based in these four countries, our Nevertheless, with global demand • Educated, trained, and partnered with more than 350 journalists to increase and improve Research, Report, and Advocate projected to quickly outpace media coverage of TB and MDR-TB approach enables us to share manufacturing capacity, Lilly findings with governments and sought a longer-term solution for Phase III (2012–2016): The Eli Lilly and Company Foundation provided an additional $30 million experts in other countries facing people needing these medicines. for the third phase of the partnership. During this phase, the partnership is targeting four of the similar MDR-TB challenges. highest-burden MDR-TB countries—China, India, Russia, and South Africa. In 2003, after close consulta- tion with global TB experts, Lilly Three key areas of focus: The Evolution of the Lilly embarked on an ambitious ap- • Healthcare provider training and healthcare systems strengthening proach: transferring our manufac- • Improved access to safe, effective medicines MDR-TB Partnership turing technology and know-how • TB medicine discovery Our MDR-TB Partnership was for capreomycin and cycloserine initiated in 2003 and is closely free-of-charge to seven manufac- Phase IV: Plans for this next phase of the Lilly MDR-TB Partnership will be announced in late 2016. tied to Lilly’s pioneering legacy in turers located closer to the people addressing infectious diseases. needing these medicines. Ulti- In the 1940s, we became one mately, this turned out to be more
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INTERNATIONAL RECOGNITION ensure access to quality- the voice of civil society in TB assured medicines; and support efforts, and collaboration with The work of the Lilly MDR-TB Partnership has been recognized at the international, national, and drug discovery efforts. the WHO to strengthen private local levels. Over the years, the Lilly MDR-TB Partnership has received awards or commendations sector engagement in TB care from several organizations and governments including the Clinton Global Initiative, International and control and to disseminate Chamber of Commerce, Global Business Coalition on Health, China Medical Association Tuberculosis The Lilly MDR-TB Partnership— best practices; Society, Russian Ministry of Health, Government of the Republic of Karelia, International Council • Playing a leading role in en- of Nurses, and others. International Efforts In addition to working in four suring a reliable supply of “MDR-TB hotspot” countries quality-assured second-line than a decade-long initiative. We MDR-TB. Given Lilly’s anti-infective during the third phase of the Lilly MDR-TB medicines, including have documented Lilly’s experience heritage and technical capabili- MDR-TB Partnership, we are support for the development and insights from this initiative in a ties, we believed we could make a working with leading international of a “data dictionary” that cre- white paper titled Seeking Solutions meaningful difference by working organizations and partners to ad- ated common standards and to a Global Health Challenge. with leading global health experts vance global TB efforts, including definitions to improve access to find new long-term solutions. these activities: to quality-assured medicines We also produced a video discussing through better drug forecasting • Serving on several boards and the experience. With the technology transfer already and improved global drug supply; underway, we formally launched committees dedicated to reducing • Helping to raise awareness of the Lilly MDR-TB Partnership—our the global TB burden, including TB by supporting a global con- largest-ever philanthropic effort—in the WHO Public-Private Mix group, cert organized by our partner 2003 with a $170 million commit- the WHO Europe Regional Collab- TOPOLO for the past several ment. Using our Research, Report, orating Committee on TB Control years on World TB Day. and Advocate approach, we continue and Care, the Stop TB Partnership to develop and evaluate new evi- Private Sector Delegation, and the dence-based models of care that Global Fund Private Sector Dele- VIDEO Lilly MDR-TB Technology Transfer TB Drug Discovery Efforts can be adapted, replicated, and gation Advisory Group; Along with the work we do with Establishing a sustainable global scaled to improve outcomes, reduce • Partnering at the global level partners in the field, we are sup- supply of these medicines was an costs, and help turn the tide against with the International Federation porting early-stage research for important first step. However, it MDR-TB around the world. of Red Cross and Red Crescent Societies to provide on-the- greatly needed, new TB medicines was increasingly clear that more Throughout this effort, we have ground community solutions as an integral part of our MDR-TB comprehensive, long-term ap- worked with nearly 45 partners to in eight countries, the Interna- Partnership. Most TB medicines in proaches were needed to address elevate TB on the global stage; in- tional Council of Nurses to train use today are at least 50 years old, the complex social, economic, and crease awareness, prevention, di- nurses in 10 countries, the Stop take too long to work, and have medical issues associated with agnosis, and treatment outcomes; TB Partnership to strengthen potentially debilitating side effects.
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WHY CHINA? DIABETES GROWTH CREATES AN URGENT NEED FOR QUALITY CARE TB Drug Accelerator (TBDA): Lilly 2015 Lilly MDR-TB Partnership is a part of this ground-breaking collaboration launched in 2012 Highlights China Prevalence in China with an investment of $20 million • Improved access to MDR-TB diag- (30%) 11.6% from the Bill and Melinda Gates nosis and care in India by working with pharmacists: Following TB 9.7% Foundation. TBDA includes eight pharmaceutical companies and training for 3,000 pharmacists, 422 million seven research organizations. TB case detection rates in- 5.5% global cases of TBDA’s focus is to develop new creased by 7–12 percent in pro- diabetes* gram geographies. 2.5% TB drug candidates with novel 1% mechanisms of action that could • Decreased incidence of TB in lead to a breakthrough TB drug Russia: TB incidence in Voronezh 1980 1994 2000 2007 2010 regimen that cures patients in just dropped to 33/100,000 compared 422 million people live with diabetes globally, and Best diabetes care and diabetes-trained healthcare one month. Although the primary to the national incidence of China already accounts for about 30% of global cases. providers are largely concentrated in large city objective is to shorten treatment 60/100,000, and TB mortality in Global cases are set to grow to 642 million by 2040.** and county hospitals, leaving millions living in duration, this work will also ad- Voronezh is now half the national smaller communities and rural areas in need. average. * Global Report on Diabetes 2015, World Health Organization dress the issue of antimicrobial ** International Diabetes Federation. IDF Diabetes Atlas, 7 ed. resistance. The partnership is Brussels, Belgium: International Diabetes Federation, 2015 • Improved access to MDR-TB care unique because it breaks from in South Africa: Our partnership is traditional research and devel- credited with helping the national opment practices. The members department of health enact a Our efforts to find new cures for which is headquartered in Seat- work together to develop the best policy of decentralization to make TB include the Lilly TB Drug Dis- tle. Lilly provided startup fund- prospects, regardless of where the treatment available closer to pa- covery Initiative and participation ing andhelped establish IDRI’s drug originated. The structures of tients’ homes. in the TB Drug Accelerator (TBDA). high-throughput screening and lead compounds identified through chemistry laboratories as well as the program will ultimately be • Implementation of electronic tools Lilly TB Drug Discovery Initiative: access to more than 800,000 mo- placed in the public domain. to manage MDR-TB drug supply: This nonprofit, public-private lecular entities from our compa- The partnership is addressing partnership was launched in ny’s compound library. In addition, the problem of poor drug fore- 2007 to accelerate early-stage several Lilly scientists volunteer casting and inventory manage- drug discovery. Lilly’s lead their time to assist IDRI in its dis- ment to ensure that patients partner is the Infectious Dis- covery efforts. have access to uninterrupted ease Research Institute (IDRI), treatment.
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unmanaged, diabetes can have “One of the biggest challenges we face is how to help Addressing devastating physical and eco- nomic impacts on individuals, more people on this planet gain access to quality their families, communities, and Diabetes in China: governments. health care. Today our medicines are within reach for In China, diabetes has grown very about two billion people. How might we reach the Lilly Expanding quickly in recent years and already accounts for about 30 percent of other five billion?” Access for People global cases of the disease. While large central hospitals typically - John Lechleiter, Ph.D., Lilly Chairman, President, and CEO (LEAP) provide high-quality diabetes care, capacity constraints at these larger hospitals result in people increas- LEAP'S OBJECTIVE: SUSTAINABLY EXPAND EFFECTIVE ACCESS USING NEW COMMERCIAL MODEL ingly visiting smaller clinics located Diabetes is a major public health in communities and townships New patient segment Sustainable strategy problem that is sweeping the where the capacity to provide good Small county hospitals, community health Creating shared and lasting value for people, centers, township health centers communities, and Lilly world. According to the Interna- diabetes care is often lacking. To tional Diabetes Federation, today address diabetes and other chronic more than 400 million people conditions, the Chinese govern- worldwide live with the disease, ment is focused on increasing the but this number is expected to quality of care for diabetes in the exceed 600 million by 2040. Left country’s community or township health clinics—and Lilly is as well. Lilly’s approach with LEAP is fur- ther explained in this video. LILLY'S LEAP INITIATIVE Innovative model Collaborative approach An integrated healthcare provider-patient Leading to real, replicable solutions What: An integrated framework of practical system aiding initiation, driving adherence healthcare provider training, comprehensive Healthcare system assistance for people with diabetes, and administrators access to effective care including medicines. Provider
How: Address a critical gap: limited Patient high-quality diabetes care in community and Expert township health centers in China. VIDEO Lilly Launches New LEAP Project in China Lilly partners
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 54 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
With a rich heritage of developing A COLLABORATIVE APPROACH innovative diabetes medicines and solutions, Lilly has aligned with the Working with local partners to ensure long-term success Chinese government’s efforts to help more people with chronic ail- ments like diabetes and their com- munities through a new initiative called Lilly Expanding Access for People (LEAP). LEAP is being im- plemented across China, and, as of early 2016, is active in 13 provinces. LEAP is designed to create shared and lasting value for individuals, their families, and communities, as well as for Lilly. Focused on small community and township health centers without high-quality dia- betes care services, LEAP offers a Promoting Effective Access the healthcare system to lessen to treating diabetes. The initiative new and sustainable approach to in- to Diabetes Care these barriers. assists healthcare professionals in creasing effective access to quality their care of these patients: Through LEAP, we are working LEAP offers more than access to care, including Lilly’s products, by with governmental departments medicines in the traditional sense. • Newly diagnosed people operating where unmet diabetes and others to approach the chal- In China, insulin is usually readily requiring insulin (initiation), needs are high and providing more lenges of access to effective care available and reimbursed, but it focused and practical support. • People already on insulin who in an integrated fashion. There are is not always used when and as are referred from large teaching By tying business objectives to significant barriers to effective needed. In this context, effective hospitals (management), social outcomes, LEAP is poised diabetes care in China including access means increasing the skills • People needing support in con- to enhance Lilly’s competitiveness low public understanding of the and confidence of primary care sistent use of insulin (adherence). in China while simultaneously disease in some areas, treatments physicians who are treating those improving local health outcomes that are perceived as complex and with diabetes, and increasing pa- LEAP is structured to improve effec- and community well-being through difficult to manage, and low confi- tients’ understanding of diabetes. In tive access to care so people can get specialized training, support, and dence among some primary care many community-based centers in the right care in the right place at partnership. physicians in prescribing insulin, China, there is often a low degree of the right time, and enjoy the benefits to name a few. LEAP works across confidence and skills when it comes of improved health outcomes.
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in efforts to reduce hunger and We have pledged to “break the Hunger Relief improve access to food globally. cycle of hunger” in 100 commu- Elanco develops tools and tech- nities around the world by 2020.1 nologies that protect animals Breaking the cycle in a com- from infectious diseases, enhance munity means making at least Population growth is skyrocketing, animal well-being, and eradicate 100 people more food secure with the total number of people on food-borne illnesses. These tools than they are today for at least Sustainable Development the planet expected to soar past 9 and technologies, in turn, enable one year. By the end of 2015, billion by 2050. At the same time, farmers and producers to provide we had made food more secure We will be a global leader in we are seeing incredible growth of greater amounts of food—safely in 62 communities—more than sustainable food-security initiatives. the global middle class. and sustainably. 650,000 households—around the world through philanthropic An increase in income typically Through global partnerships partnerships, company-sponsored leads to an increase in a family’s and volunteer efforts in our own donation programs, and volunteer intake of meat, milk, and eggs, backyard, we support community initiatives that deliver food, dollars, improving overall nutrition. Yet, programs and initiatives that and Elanco capabilities to those based on today’s production provide food to those who need it who need them most. trends, the world might not have and promote awareness of hunger enough resources to meet the and the related problem of food Employee Engagement growing demand for these prod- insecurity. Food insecurity refers We are personally invested ucts. There remain 795 million to having inadequate, or uncertain, Partnership with hungry people in the world each access to enough nutritious food in the hunger case. day. We believe that every person to feed oneself and one’s family. Heifer International on earth deserves a minimum of a Over time, food insecurity can lead Elanco has had a strategic rela- glass of milk and an egg a day—a to people going hungry if they are tionship with the nonprofit Heifer modest, but achievable, goal. not able to get the food they need International since 2007, part of to thrive. Our commitment focuses an ongoing program to lift 100,000 Because Elanco, Lilly's animal on three areas: employee engage- families out of hunger. We have health division, is dedicated to ment, community and customer committed a $1.5 million matching improving animal health—includ- engagement, and sustainable ing the health of animals raised Community & Customer development, with a unified goal of for food—we have a direct con- 1 We have defined a community as one that nutritious food that is accessible Engagement nection to helping feed people includes 100 or more people. We previously and affordable to all. announced our intent to meet this goal by We will break the cycle all over the world. We engage 2017. However, we have revised the goal to align with Elanco’s current strategic focus. of hunger in our communities
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challenge to the organization’s East Africa Dairy Development (EADD) project, which aims to improve the livelihoods of more than 1 million people in Uganda, Tanzania, and Kenya by 2018. Funding for the matching chal- lenge was provided by the Eli Lilly and Company Foundation. Overall, Elanco has contributed more than $4 million to Heifer projects that include contributions of animals and training for families in various countries, including China, India, Indonesia, and Zambia. Launched in 2008, EADD focuses on empowering small dairy producers to move beyond subsistence toward sustainable livelihoods. Farmers receive extensive training on dairy husbandry, business practices and operations, and marketing of dairy products. The second phase of the project employs new technol- “Heifer International helps families and communities lift themselves out of hunger ogies and practices around feed production, alternative energy and poverty through gifts of livestock and extensive training. We are grateful for sources, and milk transport sys- tems. The project’s goal is to reach Elanco’s support of our EADD project. Creating sustainable dairy markets in East 136,000 smallholder dairy farmers, giving them—and their families— Africa increases food security and helps farmers get closer to the living income opportunities to achieve financial independence. The program will they need to meet their immediate needs and beyond. So, the partnership between also give more people in the region Heifer and Elanco enables us both to help make the world more food secure.” better access to dairy products and will support women in their — Pierre Ferrari, Heifer International President and CEO
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efforts to become entrepreneurs enough protein and other nutrients already do on a regular basis— activity, and 50 percent participated and leaders in the dairy business. to meet his or her body’s needs. purchase eggs at a grocery store. in a company-sponsored companion Eggs are one of the most com- Consumers can participate either animal or other community service Elanco’s commitment includes monly requested products at food by donating money to the initiative activity. In 2015, Elanco employees financial support and the talents of banks, and yet eggs are typically in or by purchasing HATCH-labeled committed approximately 30,000 Elanco employees to provide on-site short supply. In 2015, Elanco part- eggs. Each purchase of a dozen hours of volunteer time; by 2020, training in cow health through 2018. nered with local grocery stores, eggs triggers an automatic dona- we expect that Elanco employees farmers, and area food banks to tion of one egg to a local food bank. will have volunteered 200,000 hours pilot the HATCH™ philanthropic over a period of seven years. During the first nine months of the HATCH Initiative program, an initiative that makes pilot HATCH program, more than a All Elanco employees receive a In the United States, one in five it easy for individuals to make a half-million eggs were donated to half-day per quarter of paid time off people does not have access to difference through something they local food banks in the midwestern to volunteer with local hunger- or United States, benefiting more other cause-related organizations. than 43,000 families. Elanco plans We want our employees to connect to expand the HATCH program to on a personal level to the problems bring food security to other loca- of world hunger so that they can tions in the United States and addi- contribute to solutions. We have a tional countries. team of approximately 75 “hunger ambassadors” who help to coor- dinate on-the-ground volunteer Employee Engagement activities with their Elanco peers in 30 different countries. Programs Our goal is to reach an employee range from providing backpacks engagement level of 80 percent in filled with food for children facing our Elanco division by encouraging food insecurity at home to stocking our employees to connect with the shelves at local food pantries hunger cause.2 In 2015, 60 percent to supporting orphanages and of our Elanco employees participated schools for child refugees. In 2015, in a company-sponsored hunger more than 2,500 employees partic- ipated in our Global Day of Service 2 We previously announced an aspirational goal to engage 100 percent of our work- and contributed more than 10,000 force in this cause. We have updated the volunteer hours at 125 locations in goal to 80 percent to align with our cur- 30 different countries. rent strategic focus and intend to measure progress through our employee survey.
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Product Insulin Partnership Donations with Life For a Child The International Diabetes Federa- tion’s Life for a Child program provides support to 15,000 chil- While creating programs that dren and youths with diabetes in focus on shared value is an 46 of the world’s poorest coun- emerging strategy in our corporate tries. To date, Lilly has donated responsibility efforts, there will more than 800,000 vials of insulin always be a place for philanthropy to the program—our largest at Lilly. single-product donation—and in 2015, we extended our commit- We believe that finding the right ment to cover an additional 780,000 mix of approaches leads to the vials over the next three years. greatest impact. Shared value, when paired with other actions, including results-oriented philan- thropy, can maximize our contribu- Helping to Treat Mental tion to society. Health, Diabetes, and In addition to our contributions to organizations working to sup- Cancer in Africa port global health initiatives, Lilly For more than 10 years, Lilly has donates medicines in a variety of partnered with Indiana University settings, including through partner- and the Moi Teaching and Referral ships with aid organizations, non- Hospital, based in Eldoret, Kenya, profits, and governmental bodies. through the AMPATH (Academic Model Providing Access to Health- care) program. One of Lilly’s oldest philanthropic partners, AMPATH is making an incredible difference in the lives of patients who are in desperate need. As part of the
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patients in need who lack access to Disaster Relief their prescribed Lilly medicines. In When disasters strike, Lilly re- 2015, Lilly Cares Foundation PAPs sponds with cash and product supported 165,000 patients, and Lilly contributions to help people in donated $500 million in products. desperate situations. We partner Lilly retired its Lilly TruAssist with relief organizations to deter- umbrella program at the end of mine how Lilly can uniquely meet 2015. Now Lilly donates product to needs on the ground and best the Lilly Cares Foundation, which serve those who are impacted. operates a simpler and more sus- In 2015, Lilly gave approximately tainable PAP offering that main- $2.3 million in cash and product tains its focus on customer needs. donations in the wake of natural Moving forward, all PAP support disasters. In response to the will be offered through the new Nepal earthquake, we donated program, Lilly Cares, which is de- $1.5 million in products and pro- signed to serve uninsured, under- vided funding to three organiza- insured, and certain Medicare Part tions providing relief in the region: D patients who are unable to afford World Vision, Americares, and their prescribed Lilly medications. International Medical Corps. Our AMPATH collaboration, Lilly pro- schizophrenia. As part of Lilly’s Lilly also partners with Direct employees also donated funds vides donations and medicines collaboration with AMPATH, these Relief International—an organiza- through the Lilly Global Giving to treat mental illness, diabetes, mental health medications help to tion that provides and replenishes program, which was matched by and cancer, supporting Indiana treat approximately 500,000 people. medications at no cost for eligible the Lilly Foundation for a total of University and Moi staff that col- In early 2015, the Lilly Foundation patients through an efficient pro- $120,000. laborate to improve outcomes for provided a $1 million grant to sup- cess that is integrated directly patients who otherwise couldn’t port AMPATH’s Oncology Institute into existing clinic pharmacy and access quality care. efforts to screen, treat, and provide dispensary systems. Since 2013, palliative care to people living in Patient Assistance Lilly has supported 5,856 patients Since 2002, Lilly has donated about low-income communities who are with donations of $13 million in $80 million in medicines, including fighting cancer. That same year, Lilly Programs prescription medications through antidepressants and antipsychotic donated nearly $20 million in prod- The strategic intent of the Lilly this organization. Our entire men- medications, among others, used ucts for people afflicted with mental Cares Foundation Patient Assis- tal health portfolio of products is to treat unipolar depressive disor- illness, cancer, and diabetes. tance Programs (PAPs) is to help available free of charge to patients der, bipolar affective disorder, and improve health outcomes for who are enrolled in the program.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 60 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Interactions (a nonprofit focused FOR ONE WEEK EACH YEAR, I’M NOT THE ONLY ONE: A CAMPER’S EXPERIENCE Patient on connections between patients and their healthcare providers). I first heard about Camp Kudzu outside Atlanta, Georgia, when I was diagnosed with diabetes at This program features Conversa- age seven. The following summer, my parents packed my bags, and the next thing I knew, I was Programs tion Map™ education tools, which there. That first year you could easily find me singing and dancing, competing for the “Golden use a visual approach to facilitate Syringe,” which is awarded to campers who try something new related to their diabetes care, and interactive group discussion to on the final day, refusing to pack my bags. At Lilly, we want to do what we can empower people with diabetes to Little has changed in my passion for diabetes camp. I haven’t missed a single summer in 15 years, to better support patients who are become more active in managing and most of my closest friends—well, family—come from camp. I learned about diabetes man- dealing with acute or chronic con- their disease. The tools are built agement and life in general from the people around me. I keep in touch with many friends I made ditions that map to our therapeutic on a foundation of evidence-based my first year, including my two counselors and a clinician. portfolio. An important part of this education principles and clinical guidelines that include the Inter- In addition to what camp gave me, it also gave my parents a week to sleep. Every year, it was an work is helping patients and their easy sell when camp registration came around since they checked on me nightly while I was in national Standards for Diabetes family members understand the bed, especially in those early years. disease that they are dealing with Education published by the Inter- and providing them with the infor- national Diabetes Federation. Attending camp taught me it’s more than just “okay” to be yourself. I realized early on that if it mation, resources, and encour- Since 2008, these educational weren’t for camp, I’d have barely interacted, let alone become best friends, with the people in my agement they need to effectively tools, available in 38 languages, life who simply “get it.” My experiences at camp also influenced my decision to get involved with my chapter of the College Diabetes Network at the University of Georgia because chapter involve- live with, or potentially combat, have been launched in more than ment was like camp all year. their illness. 121 countries. Diabetes camp is a powerful and empowering experience. For one week every year, I’m not the only With patients and their family one. Camp is family. Camp is always there for me. Camp changes lives, including mine. members in mind, we support Diabetes Camps many programs globally, which A three-year survey by the are implemented at the local level, American Diabetes Association Mindy Bartleson Program Assistant, College Diabetes Network including the following examples. (ADA) shows that attending sum- mer camp can do much more than lift the spirits of children with type Diabetes Programs 1 diabetes (T1D). Surveys con- ducted with caregivers before and Diabetes Conversations after their child attended an ADA Lilly sponsors the Diabetes camp found the experience can Conversations program, increase some children’s diabe- which was created by Healthy tes knowledge, self-confidence,
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 61 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
diabetes management, and emo- Type 1 Diabetes: Lilly’s endocrinologist and other health- support services for those with tional well-being while enjoying care provider offices—in a total Alzheimer’s disease. traditional camp activities.3 Collaboration with Disney of 50 countries and 30 languages Since its inception, 12 cities across A child’s diagnosis of type 1 dia- around the world. In the United Lilly employees often volunteer at the United States have participated betes (T1D) can be overwhelming, States, our collaboration also diabetes camps, and we facilitate in the program. In each city, the and caregivers often question if offers these resources online, visits from special guests. We are conversations have led to concrete they will ever be able to get their along with other unique content also one of the largest providers of action steps to improve Alzhei- families back into any kind of daily that provides advice and prac- insulin and glucagon, educational mer’s care and awareness. For routine. Both parents and the child tical tips, recipes, and activities materials, and scholarships to dia- instance, organizations involved may feel the diagnosis is the end for families affected by T1D at betes camps through the compre- in the program have conducted of their future hopes and dreams. T1EverydayMagic.com. hensive Lilly Camp Care Package. This understanding forms the dementia-education training for In 2015, we provided $4.3 million in foundation for Lilly Diabetes and hospital emergency rooms; have insulin and 23,000 educational book our collaboration with one of the improved physician outreach and packs and caregiver kits to ADA most recognizable brands in the Alzheimer’s Programs provider education on detection, camps around the United States. world: Disney. Lilly pairs its deep diagnosis, and patient resources; expertise in diabetes care along Community Conversations and have reached out to clinicians To date, Lilly has donated $31 mil- with Disney’s experience in mag- The Community Conversations to encourage annual wellness vis- lion in insulin and 174,000 educa- ical storytelling to encourage and program enables information its and to pilot a rapid referral sys- tional book packs with materials inspire families coping with a diag- sharing with the goal of improv- tem. This is only a small sample of on diabetes management. Since nosis of T1D for a child. ing resources and outcomes for the kinds of activities this program 2008, we’ve contributed $716,000 people with Alzheimer’s disease has generated. Efforts will con- in camp scholarships, and, in early Launched in 2011, the Lilly Diabe- and those who care for them. The tinue in 2016 to collaborate with 2016, we made a commitment to tes and Disney collaboration offers program’s collaborative approach organizations in even more cities. donate another $93,000 to ADA healthcare providers and families engages local advocacy organiza- for camp scholarships—$1,000 for a variety of fun and educational tions and brings together a wide each year Lilly has helped those printed resources, including a range of community stakeholders Training Program to Support living with diabetes since we intro- book series for younger children (e.g., social services, healthcare duced the world’s first commer- Dementia Patients featuring Coco, the first Dis- providers, government, community cial insulin in 1923. ney character with T1D. Most of Lilly has been engaged in research agencies, and law enforcement) to to develop better treatments to the books, including the newest learn from each other and develop book, Go, Team Coco!, are now help dementia patients and their 3 American Diabetes Association. “Camps action plans that help improve families for more than 25 years. Make a Difference.” Accessed on January available through many pediatric detection, diagnosis, care, and 26, 2016. Dementia is a significant issue
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 62 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
in Japan, with cases expected to that they understand the benefits rise from 4.6 million to 7 million of early diagnosis and to ensure by 2025. In 2015, Lilly Japan held that they can connect individuals a training program attended by diagnosed with dementia with more than 100 employees who relevant support services. In 2015, wanted to learn how to better sup- the Alzheimer’s Society distributed port those with dementia in their more than 1.8 million leaflets to community. The training covered healthcare professionals and mem- general information about dementia bers of the public, generating more (including symptoms and under- than 100,000 visits to the campaign lying illnesses), prevention, the website. In addition, Alzheimer’s importance of early detection, and Society staff supports 25 distinct tips for interacting with dementia health organizations to promote lo- patients. Following this successful cal awareness of the campaign and event, we plan to continue offering the benefits of early diagnosis. the training in the future. Oncology Programs “Worried About Your Memory?” Campaign Oncology on Canvas® Lilly UK has supported the Alzhei- Lilly Oncology on Canvas is a thousands of people have inspired cancer is the second leading cause mer’s Society’s “Worried About program that uses creativity to others. Their art and narratives of cancer death in men and the Your Memory?” campaign since provide a vibrant spectrum of are a testament to the power of fourth in women. Each year, nearly 2011. The campaign forms part of emotional support for people with affirmation, inspiration, and the 930,000 people worldwide are the Alzheimer’s Society’s ongoing cancer and for those who care for human spirit. diagnosed with this form of cancer, commitment to encourage early them. In partnership with the and approximately 700,000 die of diagnosis. Working with members National Coalition for Cancer the disease. There is very little of the public who have concerns Survivorship—a nonprofit cancer Resources for Stomach reliable information available about about their own memory, or that of organization founded by and for Cancer Patients stomach cancer—and very few a friend or relative, the Society en- cancer survivors—we give people In 2015, with financial support survivors who have “been there.” courages individuals to see their affected by cancer an opportunity from Lilly Oncology, Debbie’s PREP offers support services and physicians to discuss concerns to share their stories through art Dream Foundation launched a materials at no charge that provide about memory problems. and narrative. Since the founding first of its kind Patient Education patients, families, and caregivers of Oncology on Canvas in 2004, Resource Program (PREP) for with the most current informa- The Society also works closely with tion to help them make informed healthcare professionals to ensure the art and narratives shared by stomach cancer patients. Stomach
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 63 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
decisions about patient care and help them access and comprehend lifestyle choices, including infor- information about their own health The Institute of Medicine defines health literacy as mation about the disease, treat- histories and conditions, engage “… the degree to which individuals have the capacity ment options, specialists, clinical their healthcare providers openly, trials, support groups, diet and nu- understand and recall informa- to obtain, process, and understand basic health in- trition guidance, and much more. tion, and make decisions regarding treatment options. Some patients formation and services needed to make appropriate must also maintain complex Sirius XM Satellite Radio Show behaviors over time to manage health decisions.” Lilly Oncology sponsors Sirius a chronic disease or condition in XM Doctor Radio on Channel 110. order to achieve the best outcome instructions.4 This misinterpreta- communications and to better con- The monthly oncology-themed for their health. tion impacts the safety and effec- nect with the people who take our program is a thought-provoking, In this landscape, health literacy tiveness of the medication and medicines in ways that are mean- educational hour with guests who plays a major role. Health literacy can contribute to reduced health ingful to them. Our goal is not to include cancer care experts, survi- relates to an individual’s ability outcomes over the long term. The oversimplify patient resources, vors, and advocates. It focuses on to interact with the healthcare impact of the public’s low health but rather to communicate in plain concerns that patients, caregivers, system to receive and understand literacy in adherence to using “living room” language so people and healthcare providers deal with the information needed to manage medication as prescribed is so can understand medical informa- on a daily basis, and experts an- one’s health. If people lack clear significant that the National Council tion to make informed decisions swer phone calls and emails live and readily available informa- on Patient Information and Educa- about their health. to provide relevant information to tion has identified this problem as tion, in a language that is under- We partner with nationally recog- help patients with their care. one of 10 national priorities in the standable to them, they may be nized health literacy experts to help United States. less likely to make fully informed us write, assess, and user-test writ- Efforts to Improve decisions and take the actions that Lilly believes that clear health ten materials using evidence-based will best protect and promote their communications are a vital com- health communication practices. Health Literacy health and well-being. ponent of the healthcare delivery We are also emphasizing these One powerful example of the system in which we and other principles in the verbal commu- Patients are facing an increasingly importance of health literacy is pharmaceutical companies play an nication skills training for our call complex healthcare system where adherence to using medication important role. We have made a center and customer support they are expected to become more as prescribed. A person with low strong commitment to improve our program agents. active participants in managing health literacy is twice as likely to their health. More than ever, In 2015, health literacy played a misinterpret medication patients must develop skills that 4 Davis, et al. 2006. Ann Intern Med. strong role in the strategy and
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 64 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
development of several initiatives Brief Summaries to accompany across the company, including the advertisements for drugs that following: appear in print (e.g., in magazines). These summaries are typically one Clinical Trial Consent Documents or two pages of black-and-white Participants in clinical trials are print following a full-color adver- required to sign a document indi- tisement to disclose risk informa- cating their consent to take part in tion about the medication. Some the study. This document includes studies suggest that few people important information about the understand or attempt to read the trial, including its purpose, the summaries because they can be treatment procedures and sched- difficult to comprehend. We are ule, potential risks and benefits, conducting research on the read- alternative treatments, and an ability of the content and format of explanation of the participant’s our Consumer Brief Summaries rights. Using health literacy prin- with the goal of improving patient ciples, we improved the readability outcomes through better compre- of the document and transitioned hension of product information. it into an electronic format, which allowed us to tier the content Support for Healthcare and make it easier to access the Professionals information. This new eConsent Facilitated by Lilly’s Health Educa- document continues to improve tion Consultants, “Health Literacy industry, government, foundations participant comprehension, re- & Clear Communication” is an in- Lilly’s Ongoing Efforts and associations, and represen- tention, and overall consent and teractive, educational program that To further build on our momentum tatives of patient and consumer clinical trial experience. Market provides healthcare professionals in the area of health literacy, we groups that have an interest in research testing with clinical trial with practical and useful strate- established a leadership position improving overall health literacy. participants was so favorable that gies for clear communication and in early 2016 to unite our business By participating on the Roundtable, we are moving forward with broad patient engagement. The program in this area and promote health we have an opportunity to continue implementation across many clini- includes small-group practice literacy as an organizational value to make a difference at the national cal trials in 2016. activities, video case studies, and that we infuse into all aspects of level and to directly support the opportunities for participants to ap- patient communications. Lilly is Improving Comprehension of National Action Plan to Improve ply their knowledge and techniques also a member of the Institute of Product Information Health Literacy as outlined by the to patient and caregiver situations. Medicine’s Roundtable on Health The U.S. Food and Drug Adminis- Literacy. The Roundtable brings U.S. Department of Health and tration (FDA) requires Consumer together leaders from academia, Human Services.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 65 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact Strengthening Communities
p67 Giving at Lilly p68 Volunteerism at Lilly p70 Education Initiatives
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 66 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
At Lilly, we believe that by uniting we’ve deepened our relationship To encourage our employees to caring with discovery we can make life Giving at Lilly with United Way—moving from give to the organizations that better for people around the world. We largely a fundraising role to that matter most to them, Lilly matches of a strategic partner. We believe employees’ donations to nonprofits. do this by finding and developing new United Way is uniquely positioned We also promote opportunities to medicines that improve the lives of Our commitments to helping to help address some of the most give to specific organizations (such patients globally. But we feel we can those in need started with our complex challenges facing our as the United Way) and disaster do even more, which is why we use founder, who aided the poor and communities and that through relief efforts throughout the year our financial resources, our time, and unemployed in Indianapolis, IN. In partnership we can make progress with pledge drives. 1937, the Lilly family established our expertise to make a meaningful, even faster. the Lilly Endowment, which has measurable, and sustainable since grown to become one of the difference in the communities where largest and most important foun- CHARITABLE DONATIONS* we operate. dations in the country. The family members were also major donors Over the last couple of years, we have seen a decrease in the number of people requesting assistance Each year, Lilly donates substantial to the Community Fund, which through our U.S. patient assistance programs following the implementation of the Affordable Care amounts of products and cash—more eventually became the United Way. Act, which allows previously uninsured low-income Americans to obtain healthcare coverage. As a than $560 million in total in 2015—and Our CEO, John Lechleiter, Ph.D., result, fewer people were in need of donations from Lilly. our employees volunteer their skills at has been involved with United Way throughout most of his career at home and around the world. Many of Product Cash and In-kind Total Lilly and now serves as chairman Donations Contributions Contributions our donations, including those provided for United Way Worldwide. through The Eli Lilly and Company Throughout our history, the com- Foundation, focus on improving patient pany and our employees have given 2013 + = outcomes and enhancing quality of life. more than $250 million to United $695M $55M $750M Way, and in 2015, Lilly presented a gift of $13.2 million to the non- 2014 profit—our company’s largest-ever $550M + $40M = $590M United Way contribution.
Over the last several years, United 2015 Way has transformed how it oper- $510M + $50M = $560M ates, with a focus on measurable community impact. In response, • Total charitable donations include funding from Lilly and the Lilly Foundation.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 67 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
In addition to traditional philan- thropy, we extend our impact by Volunteerism tapping our business expertise to create new partnerships and make significant strides in several key at Lilly focus areas, including improv- ing health for people in low- and middle-income countries and Our robust tradition of volunteer- strengthening the communities ism is often cited as a reason why where we work and live, especially people come to work for our com- through improvements to educa- pany. We encourage our employ- tion. We’re partnering with leading ees to give back to their com- health organizations and govern- munities and support nonprofits ments to explore new approaches to globally through volunteerism, and complex global health challenges, we provide a number of programs discussed in more detail in the to help them do so. Once an Improving Global Health section of employee has recorded 30 hours this report, and our Elanco animal of volunteer service, he or she health division supports initiatives receives a $250 grant, which that to break the cycle of hunger in person can donate to the nonprofit communities around the world. organization of his or her choice. A HISTORY OF SERVICE IN INDIANAPOLIS LILLY ONCOLOGY EMPLOYEES REACHING OUT TO CANCER PATIENTS Established in 2008, our annual Global Day of Service is among the largest single-day volunteer initiatives of any U.S. company. In Indianapolis, where our company is headquartered, this event During our 2015 Global Day of Service, Lilly Oncology employees in cities across the United States has had a profound effect that extends beyond our own employees. Over the years, it has gained worked to make life better for people impacted by cancer. The employees volunteered with oncol- momentum and has transformed into “Indy Do Day”—an annual, citywide volunteer event. ogy patient advocacy groups to work on projects that benefit patients and caregivers, including making blankets, preparing meals, assembling patient-education kits, facilitating awareness and “Lilly’s Day of Service has changed Indianapolis forever. Lilly’s decision to dedicate its 8,000 local prevention education stations with children, and hand writing notes of encouragement. employees to a day of service has improved Indy through several projects, but it has effected exponentially more change by serving (once again) as a leading company to emulate. As a result, Lilly Oncology also partners annually with the American Cancer Society to host a Relay for Life other organizations across our city have adopted this same spirit of focused volunteerism to do event on our corporate center campus. At Relay For Life events, communities across the globe even more as part of Indy Do Day.” come together to honor cancer survivors, remember loved ones lost, and fight back against a disease that has already taken too many. In 2015, approximately 500 Lilly employees participated, – Chris Cotterill, Executive Vice President and General Counsel of the Indiana Economic raising over $125,000 to help make life better for those impacted by cancer. Development Corporation
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 68 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Employees who serve on boards Watch a video to see our em- at Home, is a partnership with Latin America. Since we began can also apply for volunteer grants ployees in action during the 2015 the United Way that allows us the program in 2011, nearly 1,000 regardless of how many hours they GDOS, and visit our website to to extend our engagement with employees, representing our dedicate to their board service. read their stories. various community programs that operations in about 60 countries we typically only work with once and from all job levels and roles In October 2015, we held our eighth a year during our GDOS. With this at our company, have participated annual Global Day of Service (GDOS). new program, our employees can in what many have described as a Easily identified in their signa- volunteer throughout the year and life-changing experience. ture red Lilly T-shirts, 24,000 Lilly build a deeper, ongoing relation- employees in 70 countries vol- Working alongside local partners, ship of service. unteered 100,000 hours in their employees participating in CHA communities. Working in food Connecting Hearts Abroad (CHA), have the opportunity to step pantries, participating in outdoor VIDEO Lilly Global Day of Service 2015 another flagship volunteer program outside their day-to-day roles at beautification projects, installing at Lilly, takes employees out of Lilly and view the world through smoke detectors in homes, and In 2015, we introduced a new their local environment. With this a different lens, applying their creating care packages for cancer opportunity for Lilly employees program, we send our employees energies and passions toward patients—these are just a few of based in central Indiana to give on two-week assignments to serving those living in low- and the activities our employees took back close to home. The pro- impoverished communities across middle-income countries. The part in during our GDOS. gram, called Connecting Hearts Africa, Asia, Eastern Europe, and employees selected for the
THE LASTING IMPACT OF CONNECTING HEARTS ABROAD
For many employees, their experience with Connecting Hearts Abroad ignites a lifelong passion for service and inspires innovative ways to make a meaningful difference in the lives of others. Here is just one of those stories. When Michael Clark, a senior sales representative with Lilly Diabetes, returned from his service trip to Peru, he carried with him a conviction to continue making a difference. Michael started Small Sacrifice. This grassroots movement encourages people to give up something small—a day’s lunch or cup of coffee—to help support the work of charitable organizations. Since 2013, Small Sacrifice has raised funds to provide 25,000 meals for children, more than 30 cleft palate surgeries for kids in Ethiopia, and clean water for life for 20 families in Africa. In 2015, Michael was recognized by Fortune magazine as one of 55 “Heroes of the Fortune 500” for his work with Small Sacrifice. Of his Connecting Hearts Abroad experience, Michael says, “A two-week service trip might not seem like a lot, but it is a lot because of what we carry back from that experience.” Find out more about Michael’s story.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 69 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
program get to see firsthand The process of generating a helps public school teachers (kin- we must recruit and retain some the day-to-day challenges that hypothesis to ultimately deliv- dergarten through eighth grade) of the best talent in the world, we confront people living in poverty. ering a medicine to a patient in effectively integrate inquiry-based know we must play a role in help- They come back with insights need requires that we employ learning curricula into their class- ing to address this issue. While this and inspiration that make us and collaborate with thousands of rooms. The Lilly Foundation provided is a complex problem, we believe a better—and more globally STEM professionals in disciplines $1.5 million in funding to support that access to high-quality educa- aware—company. such as biology, chemistry, bio- the program and extend its reach. tion is critical to breaking the cycle statistics, information technology, More than 150 schools, 2,300 of poverty. We have a number of In 2015, Lilly volunteers worked on engineering, and pharmacology, to teachers, and 53,000 students will efforts, including impact-oriented assignments in Brazil, Guatemala, name just a few. Ensuring that we participate in ISI through 2017. In philanthropy, high-profile advocacy, India, Peru, South Africa, Tanza- have access to a broad and deep addition to the funding from the and skills-based volunteerism, to nia, and Thailand. Brazil is now our pool of this STEM talent is a funda- Lilly Foundation, Lilly employees help improve educational opportu- fourth skills-based CHA program mental component of our success. also volunteer as coaches, getting nities and outcomes. Two primary associated with the Lilly NCD This is one of the primary reasons children excited about science and efforts involve expanding access Partnership, increasing the inte- we have an abiding commitment math. A study of 107 ISI schools to high-quality early education and gration and collective impact of our to STEM education. Our goal is to showed that ISI students perform supporting new, innovative models corporate responsibility programs. inform, inspire, and educate more significantly better on standard- in K–12. students about the wonders and ized tests in science, mathematics, possibilities of STEM. We do this and English language arts when Education through a wide variety of efforts the ISI teachers are well-trained in Indianapolis Preschool that seek to engage students, the curricula than their peers do in Scholarship Program Initiatives teachers, and educational organi- non-ISI schools. In 2014 and early 2015, Lilly, along zations along a student’s learning Lilly is committed to helping In addition to STEM, we are fo- with our strategic partner, United journey from kindergarten through children gain access to great cused on improving educational Way of Central Indiana, led a undergraduate and graduate educational opportunities. We are outcomes for children, especially private-sector coalition to encour- programs. We also help students focused on making a difference in those in poverty, in our home city age the local legislative body to transition to the workforce and science, technology, engineering, of Indianapolis. In Indianapolis/ pass a bold plan to provide access build careers through mentorships and math (STEM) education and Marion County, more than 20 to high-quality pre-K education for and other programs. dramatically improving the educa- percent of people live below the low-income families. As part of tional attainment of children living One of the programs we support poverty line, including nearly one our work, Lilly pledged to raise $10 in our home city of Indianapolis. in our home state is the Indiana in three children. As we think million from the business commu- Science Initiative (ISI). This initiative about the future of the city to which nity, including $2 million from the
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 70 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Lilly Foundation, to invest in pre- families who reported income at The Mind Trust autonomy. Most recently, we have school programs, if the legislature or below 127 percent of the fed- While high-quality early education helped support The Mind Trust’s acted. We are pleased that they eral poverty level. More than 1,600 is necessary, it cannot be the end Innovation School Fellowship. The passed a comprehensive plan that three- and four-year-olds were of the story. We have to ensure Fellowship is a partnership with will leverage not only these private enrolled in a qualified scholar- that every child has access to a the Indianapolis Public Schools dollars we are raising, but also ship program for the 2015 school great school, regardless of where (IPS) and the City of Indianapolis money from the state of Indiana. year. Given the preponderance of the child lives. Over the last five to help IPS create high-quality In total, Indianapolis is set to in- data on the long-term benefits of years, Lilly has committed more “Innovation Network Schools” vest $50 million over the next five investing in vulnerable children than $6 million in philanthropic within the school system. These years to help children gain access earlier, we believe this program donations to improve the educa- schools are autonomous public to high-quality early educational is going to dramatically improve tional landscape in Indianapolis. schools that will operate under opportunities. the lives of many of these children Our primary partner in this work a contract with IPS, but will be and, by extension, strengthen the free from many regulations and During the fall of 2015, the initia- has been The Mind Trust, an In- fabric of our home city. bureaucratic burdens, giving prin- tive’s first year, the Indianapolis dianapolis-based nonprofit. We cipals and teachers the autonomy Preschool Scholarship Program, have worked together to attract and accountability that are hall- administered by United Way of more great leaders and teachers marks of high-performing schools. Central Indiana, received 5,000 ap- to local schools and to encourage plications—nearly 4,500 were from more innovation and school-level
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p73 Ethics and Transparency p82 Supply Chain p86 Counterfeit Medicines p88 Animal Care and Use p91 Workplace p104 Environmental Stewardship
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 72 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
We recognize that how we operate In the United States, Lilly complies our business today has an impact Ethics and Transparency and with disclosure requirements at on tomorrow. And while we might both the state and federal levels. Disclosure At Lilly Outside the United States, Lilly differ in our individual perspectives, Transparency participates in voluntary disclosure we are joined together by common Transparency has challenged, and continues to challenge, us to view codes under the European Feder- values—integrity, excellence, and our business practices through the ation of Pharmaceutical Industries respect for people—that have guided At Lilly, integrity comes first be- lens of external stakeholders. By and Associations (EFPIA), impacting our collective actions for more than a cause honest and ethical behavior listening to stakeholders’ con- 33 European countries, Russia, century. Whenever we make a decision is the foundation of all good rela- cerns, we strive to continuously Ukraine, and Turkey, as well as legislated requirements within and that affects others, we strive to do it tionships. We have a deep sense of examine and improve the way we outside of Europe. Lilly views our in a way that’s consistent with these responsibility to those we serve— do business. from patients and physicians to transparency as an opportunity to Disclosure of Lilly’s financial in- Lilly values. our suppliers to the communities assure that patients, HCPs, HCOs, teractions with healthcare pro- in which we operate. and business partners feel confi- Operating in a responsible manner fessionals (HCPs) and healthcare dent when engaging with Lilly. includes our efforts in, and approaches We earn our reputation for excel- organizations (HCOs) helps to build to, promoting ethics and transparency, lence every day through the actions trust with patients, caregivers, and In 2007, Lilly voluntarily made a registry of grants and charitable instilling responsible supply chain of thousands of Lilly employees other key stakeholders. Collab- contributions given by the company management, tackling counterfeit giving their best and being open to oration and partnerships among dialogue and constant improvement. pharmaceutical companies, HCPs, publicly available. In 2009, as a medicines, ensuring the ethical and HCOs continue to be important requirement of our five-year care and use of animals in research, We work to build trust in our com- and essential for the development Corporate Integrity Agreement promoting an inspiring and inclusive pany and our industry by protect- of new treatments and lifesaving (see detail under Marketing Prac- ing the privacy of patients and by workplace, and fostering environmental innovations. For some, however, tices section in this chapter), Lilly being transparent about our busi- began to disclose payments, reim- stewardship. these partnerships have raised ness practices, including clinical concerns regarding potential con- bursed expenses, and all transfers Eli Lilly, the grandson of our firm’s trial results, pricing models, and flicts of interest where an HCP’s of value to U.S.-based physicians political contributions. Our com- founder, summed it up well. “Values,” judgment or actions regarding a on the Lilly Physician Payment mitment to ethical behavior extends Registry located on www.lilly.com. he said, “are really at the heart of patient may be influenced by rela- to marketing our products in a tionships with industry. As a result, Lilly also publicly reports our com- the matter. They tell us who we are, responsible manner and working the need for greater and more de- pany’s U.S. political contributions how we should behave, and where we to provide patients and caregivers tailed transparency about industry and its financial support to patient should be going.” with quality, relevant informa- relationships with HCPs and HCOs organizations based in Europe. tion to help them make informed has grown over the past decade. healthcare decisions.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 73 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
These experiences helped Lilly 2004, we began to voluntarily dis- HOW DOES LILLY PRICE ITS MEDICINES? prepare to meet the newer obliga- close results—even the unfavorable tions under the U.S. Open Payments ones—from these clinical trials Lilly believes that the prices of our medicines reflect the value they provide to patients, providers, regulations (implementing the U.S. online. We also submit results from and society as a whole. In bringing a new medicine to market, we do not default to a standard Sunshine Act) and are also preparing all Phase III clinical trials and any pricing strategy. Instead, we consider a drug’s price in the context of the patients who need it and Lilly to meet similar obligations clinical trial results of significant the healthcare system that will deliver it. A price that is so high that few can afford our product under the EFPIA transparency ini- medical importance for publication. is not ideal, nor is a price that is too low to repay our investment and allow Lilly to research and tiative. In addition, Lilly engages In addition, we are working to develop future medicines. in dialogue directly with HCPs and deliver summaries of clinical trial In other words, we try to strike a balance between getting a reward for the investment risk we’ve other stakeholders about trans- results for phase II–IV studies taken while also being fully responsive to patients who need our medicines. parency questions through our that are written in patient-friendly EthicsPoint hotline (1-877-237-8197) language and made available on Clearly, biopharmaceutical innovation requires an extraordinary level of investment. But our or the Lilly EthicsPoint website. Lilly TrialGuide. (Learn more in the investment costs are just one of many factors that determine a medicine’s value. We also ask: How will the product be used? How great is the need? What do our clinical trials show? What are Transforming Clinical Trials section the competing products? What do patients, healthcare professionals, and payers think the price of this report.) Transparency of Clinical should be? Trial Outcomes When market forces are allowed to work, Lilly and other pharmaceutical companies compete on price and effectiveness, while insurers—public and private—negotiate for the best prices. When To benefit patients and healthcare Drug Pricing patents expire, generic medicines deliver savings through lower prices. All of these factors— professionals, we share clinical We live in an amazing era for med- competition among patented medicines, price negotiations with payers, and lower-cost generics— research, clinical trial outcomes, icines. In the past two decades, drive advances in new medicines and reduce the cost of medicines over time. and safety information. We also the pharmaceutical industry has work to protect individual patient discovered life-changing treat- privacy and our intellectual ments for some of our deadliest that the cost of treatment and For example, many of the new property, including commercially diseases, including AIDS, cancer, medications may be an obstacle insurance options include high- confidential information and con- and diabetes. These discoveries for patients trying to get the treat- cost deductible plans that require tract rights, which support our have saved or improved the lives ments they need, especially for the patients to pay thousands of dol- continued innovation. of hundreds of millions of people— under- or uninsured. lars before coverage is triggered, and continue to do so. making it difficult for patients to Transparency into trial outcomes In the United States, where the determine what they will need to provides important public health ben- But we also know that health care healthcare system is especially pay for their prescribed medication efits. We register all Lilly-sponsored of all kinds, including medicines, complex, consumers continue to at the pharmacy. Phase II–IV clinical studies, con- can be expensive. face challenges affording their ducted anywhere in the world, that medicines—even after implemen- At Lilly, we have programs that As overall healthcare costs con- were initiated on or after October tation of the Affordable Care Act. help people who cannot afford 15, 2002, on ClinicalTrials.gov. In tinue to rise globally, we recognize
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 74 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
their medicines. But collectively— measures to support improve- We also work with governments of cash and products for patient as an industry and as a society— ments in patient outcomes and im- around the world to offer our prod- assistance programs, international we need to do more. For starters, prove integration of care. Payment ucts at sustainable prices that are humanitarian causes, and other better education about how the methods and programs, such as affordable for local populations. charitable endeavors, as well as many insurance programs work value-based benefit designs, that Pricing based on the ability to pay public-private partnerships. would help consumers understand reward improvement in patient within a market is just one way which plan is right for them. outcomes and healthcare system pharmaceutical companies can processes, rather than the quan- enhance access to medicines for We could be on the verge of rede- Privacy tity of services provided, will help people everywhere. We advocate fining what it means to live with At Lilly, we are committed to com- promote access to high-value for policies that support differential some of the world’s most debili- plying with privacy laws in all parts care. Desired outcomes may be, pricing (the charging of different tating diseases. But we must also of the world and to acting ethically but are not limited to, reduced prices based on a purchaser’s abil- work to ensure people who could in our privacy practices. We work mortality and increased longevity ity to pay). Such policies can help benefit from our medicines are hard to meet our objectives of of life, adherence to appropriate balance the desire to offer lower able to afford them. operating with transparency and clinical best practice standards, medication prices to low-income respecting the privacy rights of all and improvements in care, such populations while still reward- with whom we interact. Our global as reduction in hospital stays or ing innovation. We also support Shaping Public Policy privacy office and chief privacy of- improved quality of life. efforts to decrease the final price Addressing the rising cost of ficer oversee a global privacy pro- of medicines to patients, such as health care is the responsibility of Globally, the complexities of gram that is designed to protect minimizing taxes of all types and all stakeholders, including compa- healthcare challenges require the privacy rights of patients, con- limiting markups applied in the nies like Lilly. In the United States, collaboration among private com- sumers, healthcare professionals, supply chain. we are working collaboratively to panies, governments, non-govern- our workforce, medical research shape public policy at the federal mental groups, donors, academia, subjects, and others. As a part of and state levels to preserve a and providers. That’s why we, What Is Lilly Doing to Help with this global program, we have ad- competitive insurance market- along with 12 other major health- opted a comprehensive policy and place, protect patients, optimize care companies, signed on to the the Cost of Medicines? related procedures that govern the clinical outcomes, and encourage Guiding Principles on Access to At Lilly, we have a variety of collection of personal information. innovative treatments. Healthcare during the United Na- programs that help people who Our goal is to always deliver on the tions General Assembly in Sep- cannot afford their medicines. promises we make to individuals Lilly supports exploration of inno- tember 2013. These industry-led Internationally, Lilly partners with whose personal information we vative payment models that involve principles offer a common frame- governments to identify appropri- collect and use. broad stakeholder engagement in work to help shape the partner- ate solutions to improve access the development and implemen- For more information about our ships that will expand access to to medicines in developing and tation processes, assessment privacy policies, see www.lilly. quality health care. less-developed countries. These of impact, and development of solutions might include donations com/Pages/privacy.aspx.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 75 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
THE IMPORTANCE OF SAFE HARBOR TO OUR BUSINESS approved internally (before use) for Direct-to-Consumer compliance with company poli- Although the United States and European Union both share the goal of protecting the privacy of cies and applicable legal require- Communications individuals, their approaches to privacy protection are different. The U.S.-EU Safe Harbor program ments; in some jurisdictions, they Patients routinely seek out in- was created in 2000 to bridge the gap between varying regulations and to allow U.S. organizations are also submitted to regulatory formation about diseases and to comply with the European Commission’s Directive on Data Protection. authorities. We are committed to treatments as they prepare to following leading trade associa- consult with their physicians In October 2015, the European Union Court of Justice ruled that the European Commission’s about their healthcare needs. decision to recognize the U.S.-EU Safe Harbor Framework for data privacy was invalid. This ruling tion codes of conduct regarding appropriate sales and marketing Direct-to-consumer (DTC) has the potential to be disruptive for businesses—including Lilly—that rely upon the safe harbor disease-state communications to transfer data, such as clinical trial data, employee information, transparency data, and the practices and interactions with help to raise awareness of dis- like, across international borders. Lilly’s Global Privacy Office and affiliates around the world are healthcare professionals. These eases and conditions that are often closely monitoring the situation and implementing alternative methods to transfer information in include international, regional, undiagnosed, untreated, or under- order to limit the impact to Lilly’s processes. We are confident that regardless of the outcome, and country-specific codes such we will be able to limit any operational interruptions and that any impact will be temporary and as the International Federation of treated, and we are committed financially immaterial to our business. Pharmaceutical Manufacturers & to providing consumer-focused Associations (IFPMA), the European communications that are truthful, Federation of Pharmaceutical In- accurate, and balanced. product information to our cus- dustries and Associations (EFPIA) For similar reasons, we engage Marketing Practices tomers in several ways, including (for Europe), and the Pharmaceu- in DTC product advertising in the the following: Our commitments to ethical busi- tical Research and Manufacturers United States, where we adhere ness practices are reflected in • Direct interaction between of America (PhRMA) code (for the to PhRMA’s Guiding Principles on how we market our products. We our sales representatives and United States) (see www.phrma.org/ Direct to Consumer Advertise- introduce a medicine to the market prescribers, as well as account code-on-interactions-with-health- ments about Prescription Medi- only if we believe it has the poten- managers and public and private care-professionals). cines and additional internal Lilly tial to improve the lives of patients. healthcare administrators; Once a product is approved for • Information provided to patients use, we communicate its benefits and physicians through package ADDRESSING PARENTS’ ADVERTISING CONCERNS and risks, market it in compliance labels and inserts; and with company policies and applica- Since October 2010, we have participated in an initiative in the United States with the Parents • Product websites and direct- ble legal requirements, and moni- Television Council (PTC) to alert parents to broadcast television programs that will contain tor it for safety concerns. Providing to-consumer communications in advertisements for erectile dysfunction drugs. Lilly sends the PTC weekly broadcast schedules of trusted, timely, and accurate some markets (see below). Cialis® advertisements. The PTC publishes advertising schedules for erectile dysfunction drugs information about our products All communications about our on the PTC’s website here: w2.parentstv.org/Main/Toolkit/Ed_Sched.aspx. is a vital part of our engagement products are reviewed and with customers. We communicate
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 76 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
principles on DTC communica- We have invested significant re- Our chief executive officer rou- tions. See the Efforts to Improve sources in our ethics and com- tinely sets “the tone from the top” Health Literacy section of this pliance programs, among them by speaking directly to employees report to learn more about our programs that focus on privacy, about ethics and compliance issues efforts to increase the effective- anti-corruption, and appropriate through his blog, through audio ness of communications so that product promotion. The elements and video messages, and through patients can effectively interact of each program include deliberate global town hall meetings. The with the healthcare system and assessment of risks, training, and global ethics and compliance orga- understand the information they communications designed to pre- nization is charged with providing need to manage their health. vent issues from arising, as well as support for and assessment of com- reporting, auditing, and monitoring pliance with global company poli- to detect potential compliance gaps. cies that apply cross-functionally. Ethics, Compliance, We also have a robust investigation The organization is headed by the process and develop corrective and senior vice president of enterprise THE LILLY CODE and Governance preventive action plans to address risk management, who is also issues that are identified. Lilly’s chief ethics and compliance The Lilly Code, established in 1899 and illus- Our commitment to ethics and officer. This position reports to the trated in this 1932 version of the Code, served compliance is born of our com- CEO and has direct access to the as the company’s first mission statement and mitment to integrity. Our policies, Ethics and Compliance board of directors’ Public Policy and code of conduct. The Code established three our Code of Business Conduct Compliance Committee. areas of focus that endure to this day. (which we call The Red Book), our Program Oversight compliance management systems, Responsibility for ethics and com- and our training programs rein- pliance at Lilly starts at the very Code of Conduct, Policies, 24 languages, this document and force ethical behavior. We have top of the company and cascades associated training emphasize the implemented programs designed to all levels of the organization. Standards, and Procedures company’s values and the impor- to promote ethical conduct and Our board of directors’ Public Our ethics and compliance tance of ethical decision-making, instill a culture of integrity, which Policy and Compliance Commit- programs include policies, summarize key principles from we continue to refine and improve. tee, consisting of five indepen- standards, and procedures. global company policies, and pro- We train all of our employees in dent director members, exercises We communicate our key vide examples for employees to ethical business practices and direct oversight of Lilly’s Global compliance-related expectations practice applying these principles have systems in place to detect Ethics and Compliance Program. through the following vehicles: to their decisions and actions. The The board’s Audit Committee has potential violations of the law and The Red Book Red Book is designed to provide direct oversight of financial mat- company policies and to correct We regularly update and dissem- foundational guiding principles to ters and some compliance-related processes so that errors do not inate our Code of Business Con- help our employees navigate an audit matters. occur going forward. duct, The Red Book. Available in increasingly complex global busi- ness environment.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 77 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Policies, Standards, Procedures, Internal Reporting training and communication is vis- and Related Materials Lilly employees are required to The program has been standard- ible through many of our activities, The information summarized in report to the company any known ized to include a global monitoring including the following: The Red Book is amplified by poli- or suspected violations of the law, strategy, a risk assessment and • Each year, all Lilly employees cies and other materials accessi- The Red Book, company policies, or monitoring plan with standard (and certain company contrac- ble to employees on the company’s official orders or decrees appli- tools, and a process for reporting tors) must complete training on intranet. These documents govern cable to our business. Employees metrics to business leaders and The Red Book and certify that Lilly’s actions with respect to spe- are also encouraged to report any key company stakeholders. they have received, read, un- cific areas, including our ethical other ethical concerns or issues. Corporate Auditing derstand, and will abide by its foundation, preventing corruption, Our toll-free Ethics and Com- Our internal corporate auditing requirements. respecting privacy, communicating pliance Hotline is staffed by an function conducts both financial • Employees receive targeted honestly, speaking up, protect- independent firm, 24 hours a day, and nonfinancial audits of all ethics and compliance train- ing information assets, and many seven days a week. Due to differ- Lilly affiliates globally to evaluate ing related to their specific job other topics. We have launched ences in local law, local reporting compliance with various com- responsibilities. a revised and simplified policy processes can vary. pany policies and procedures. architecture to enable employees Monitoring These audits include reviews of • New employees in the ethics and to better understand how to meet Lilly maintains an ethics and com- our anti-corruption program and compliance group participate in company and customer expecta- pliance monitoring program. Its our policies that govern ethical a training and education curricu- tions. We also have functional pol- purpose is to evaluate whether the interactions. Other groups at Lilly lum that focuses on understand- icies, standards, and procedures following have occurred: routinely audit additional regulated ing and implementing the ele- that apply specifically to particular functions (e.g., manufacturing, ments of an effective compliance areas of our business. • Ethics and compliance policies environment, and safety), as de- program globally. and procedures have been scribed elsewhere in this report. • Our leaders communicate regu- implemented, Reporting, Monitoring, larly with employees to reinforce • Employees have been trained on that everyone is responsible to and Auditing these policies and procedures, and Training and Communications conduct company business in an To detect possible compliance • Management is providing All employees play a role in the ethical and compliant manner, violations, we maintain an internal sufficient oversight of business success of our ethics and com- making decisions and taking disclosure system that includes a processes and related results pliance program. Therefore, we actions in line with the company’s mechanism for anonymous re- to support compliance with view training as a necessary part values of integrity, excellence, porting. We also review business company policies, standards, of promoting ethical behavior and respect for people. actions through a system of moni- and government laws and throughout our business practices. toring and audits. regulations. The company’s commitment to
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 78 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
ANTI-COUNTERFEITING MEASURES • Build awareness about vari- Engaging with Patient ous disease states, treatment To ensure patients have access to trusted medicines, a secure supply chain is a necessity. The options, and the importance global problem of counterfeit medicines requires a sustained, long-term commitment. Despite the and Consumer of adherence to treatment ongoing efforts of law enforcement and health authorities throughout the world, as well as the recommendations; efforts of the pharmaceutical industry to increase the integrity of the supply chain and support Advocacy Organizations • Provide educational information, transnational law enforcement cases, the rate of counterfeiting continues to increase significantly. We interact with advocacy organi- tools, and resources; Collaboration and cooperation are critical to stop this dangerous trend. Lilly is committed to zations to address global health- working with a wide range of public and private partners to reduce the threat to patients. To learn • Improve medical standards of care challenges and to help shape more, see Counterfeit Medicines. care and foster productive com- the healthcare environment in munication between patients and ways that support patients. We their healthcare providers; and believe that our role within this en- Investigations and Anti-Corruption Due Diligence vironment is discovering and devel- • Serve varied populations and Corrective Actions Lilly uses anti-corruption due dili- oping breakthrough medicines, as provide educational materials We take all reports of known or gence processes to assess the ap- well as providing information about that are culturally appropriate suspected violations of company propriateness of interactions with these medicines and the diseases and that respect the diversity of policies, standards, and proce- certain external parties, including they treat to healthcare profession- patients and caregivers. dures seriously, and we appro- the following: als, patients, and their caregivers. priately investigate all claims of • External parties whom Lilly may Our principles for interacting with potential wrongdoing that are authorize to interact with govern- third-party patient and consumer Advancing Public Policy brought to our attention. We seek ment officials on the company’s advocacy groups are built upon As a biopharmaceutical company to address inappropriate conduct behalf, compliance with legal require- that treats serious diseases, we as early as possible and to prevent ments, open and honest communi- • Prospective recipients of grants play an important role in public future recurrences. To accomplish cations, transparency, and funding and donations, and health and related public policy this, an investigation process is in a diversity of recipients. We seek debates. We believe it is important place globally to conduct timely, • Prospective business develop- to establish collaborative partner- for our company to participate in thorough, and professional ment partners. ships that achieve the following: global policy discussions and to investigations. All investigators are Lilly also uses an institutional noti- • Engage stakeholders on matters form partnerships with stakehold- trained to understand and follow fication process to mitigate risk re- involving public policy, improv- ers to find innovative solutions to this process and to meet local pro- lating to healthcare providers whom ing patient access to treatment global healthcare challenges. Our cedural and privacy requirements. Lilly pays for services, including options, and supporting market- engagement in the public policy clinical trial research, or to whom oriented solutions to the health- arena focuses on issues that will Lilly provides other items of value, care issues we all face; help increase access to medi- such as educational opportunities. cines. As such, we develop policy
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 79 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
positions with the needs of pa- outlined in our written Code of needs of patients. When reviewing tients foremost in our minds. Political Engagement Business Conduct, The Red Book. U.S. candidates for support, we consider a number of factors, Our public policy efforts center on When engaging in lobbying efforts Our annual report of Political including these examples: areas that we feel are critical for or making political contributions, Financial Support provides details sustainable innovation, including we comply with the laws that of our company’s U.S. political • Has the candidate historically intellectual property protection, govern such activities. All finan- contributions; our memberships in voted or announced positions sound healthcare delivery, pricing cial support and lobbying activity organizations that report lobbying on issues of importance to Lilly, and reimbursement issues, a fa- are overseen at the board level by activity to the U.S. government and such as pharmaceutical innova- vorable regulatory system, and se- the Public Policy and Compliance to which we contribute $50,000 a tion and health care? Committee, which is composed curing the legitimate supply chain. year or more; and the activities of • Has the candidate demonstrated entirely of outside directors. All We focus on conducting policy our Political Action Committee, the leadership on key committees of decisions are made without regard research, taking positions on key Lilly PAC, which is funded solely by importance to our business? issues, and improving stakeholder for the private, personal prefer- U.S. employee contributions. dialogue around topics important ences of the company’s officers • Does the candidate demonstrate In the United States, we are to our company, our industry, and and executives. All of our em- potential for legislative leadership? committed to backing candidates the people we serve. More detailed ployees must also comply with • Is the candidate dedicated to im- of any party who support public information on key issues is avail- our global policies, core values, proving the relationship between policies that contribute to pharma- able at www.lilly.com. and legal obligations, which are business and government? ceutical innovation and the health
FINANCIAL SUPPORT AND LOBBYING ACTIVITY
In 2015, Lilly spent the $1,432,775 in political financial support (United States) $6,995,000 following amounts on on federal lobbying activities direct political activity: $340,300 to state candidates in corporate contributions in the United States This information is reported to the U.S. $1,092,475 through the Lilly Political Action Committee (Lilly PAC). Congress in accordance with the Lobbying Disclosure Act of 1995.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 80 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
• Does the candidate represent MEMBERSHIPS IN 2015 a state or district where Lilly Memberships operates a facility or has a large In addition to direct political con- Board seat Non-Board seat concentration of employees or tributions, Lilly maintains mem- retirees? berships in organizations that • American Feed • Healthcare • Business • Would Lilly support have an im- report lobbying activity to the U.S. Industry Association Leadership Council Roundtable pact on his or her campaign? government. We support organiza- tions that champion public policies • Animal • Indiana Chamber • Indiana Eligible Lilly employees in the Health Institute of Commerce Competes United States may choose to make that contribute to pharmaceutical voluntary contributions to the Lilly innovation, healthy patients, and a healthy business climate. Our • Biotechnology Industry • National Association • U.S. Chamber PAC. Lilly PAC donations, which are Organization of Manufacturers of Commerce made in accordance with its bud- annual report of Political Financial get, are determined annually by the Support also notes our member- ships in trade associations that • Greater Indianapolis • Pharmaceutical Research and Lilly PAC governing board, which is Chamber of Commerce Manufacturers of America composed of 13 U.S.-based em- report lobbying activity to the ployees from various groups within U.S. government and to which the company. Support is divided we contribute $50,000 per year between the federal and state levels or more. What follows is a list of In 2015, Lilly also contributed approximately $700,000 to specific non-candidate and allocated among various candi- U.S.-based organizations that con- organizations including the following: dates according to specific recom- duct lobbying activities to which mendations from Lilly’s government Lilly contributes a minimum of • American Legislative • National Lieutenant Exchange Council Governors Association affairs department and employee $50,000 a year. Organizations with PAC members. Lilly PAC meets all which Lilly holds a board seat are noted to reflect our greater degree • Democratic Attorneys • Republican disclosure requirements and is au- General Association Governors Association dited annually by Ernst & Young. of involvement in setting priorities for these organizations. • Democratic • Republican State Governors Association Leadership Committee
• Democratic Legislative • Senate Campaign Committee Presidents' Forum
• GOPAC
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of a diverse supply base, and HOW LILLY MANAGES SUPPLY RISK Supply Chain promotion of sustainability efforts to minimize our environmental Supply risk is the risk associated with Lilly’s dependence on a third party for services or materials impact. To learn more about our that are critical to the operation of our business. This risk is monitored on an annual basis, and environmental impacts and how mitigation plans are implemented and monitored to minimize it. As part of Lilly’s ongoing supply Ensuring our products are avail- we work to mitigate them, see chain risk management, key Lilly suppliers are subject to an annual review process that considers able wherever and whenever Environmental Stewardship. historical vendor performance; financial health; geographic location; business concentration; patients need them is one of our quality and compliance management; health, safety and environment (HSE) performance; top priorities. As worldwide atten- management policies around protection of intellectual property; and physical site security. tion has increasingly focused on Maintaining and Additionally, suppliers that are integral to the business complete a supplier self-assessment the need to monitor global supply questionnaire aligned with the Pharmaceutical Industry Principles for Responsible Supply Chain chains to ensure reliability and Monitoring Quality, Management (also known as Pharmaceutical Supply Chain Initiative [PSCI] principles) and must safety, we at Lilly have continued be available for audits, at Lilly’s discretion. All supplier contracts contain language indicating the to refine our efforts in this area. Safety, and Security supplier supports the PSCI principles, as well as our Supplier Code of Conduct. For suppliers that Through better integration of are not under a contract, we expect adherence to applicable laws and regulations. Lilly-owned facilities and external of Supply suppliers, we have been able Our ability to manufacture quality to provide a steady flow of medicines for the people we Because Lilly manufactures UPHOLDING HUMAN RIGHTS THROUGHOUT materials—including active phar- serve depends on the quality and medicines that people rely upon THE SUPPLY CHAIN maceutical ingredients (APIs); availability of the materials used and that can be critical for health, delivery mechanisms, such as in the manufacturing process. we have a responsibility to safe- Lilly maintains a long-standing practice of capsules, injection cartridges, In 2015, our API manufacturing guard both the materials needed complying with local minimum-age laws and and the like; as well as product relied heavily on Lilly-owned and to manufacture these medicines requirements and does not employ child labor, packaging—so that we can man- Lilly partner facilities located in and the supply chain logistics that or forced or compulsory labor, in any of our ufacture our medicines in a more the United States, Puerto Rico, help to ensure their availability. facilities globally. In 2011, Lilly revised our consistent and reliable manner. and Europe. Finishing operations, Before they enter the Lilly system, global standards and procedures to include We view our supply chain as an including labeling and packaging, our raw material and component specific language about human rights, includ- extension of our operations, and occur at various Lilly-owned and suppliers are evaluated for techni- ing our expectation that vendors to Lilly abide we strive to instill our company’s Lilly-partner facilities, as well as cal competence, as well as patient, by Lilly’s human rights standards as one piece operating principles within our several third-party sites globally. of our Supplier Code of Conduct. View the commercial, and HSE impacts. supplier network. These include Distribution and warehousing current Lilly Supplier Code of Conduct. For those suppliers deemed to our support of the United Nations activities are strategically located have a higher risk in any of these Global Compact principles, adher- to serve their specific markets. areas, additional evaluations are ence to labor laws, development
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LILLY’S SUPPLY CHAIN AT A GLANCE conducted. These evaluations are security of our supply chains and separate from, and in addition to, our extended distribution net- In 2015, Lilly used the services of approximately evaluations of suppliers from a work remains a key focal point for 10,325 suppliers of materials and services. supply risk perspective. Lilly. We have chosen to integrate To help identify the potential impact to Lilly’s high standards to help safeguard Our Manufacturing Policy Com- business from any disruption of services or our products during transport, mittee oversees the maintenance materials, we categorize all of our suppliers integrating what are known as Suppliers in of Lilly’s inventory of essential raw using a supply risk lens. Transported Asset Protection * materials. Inventory levels of these 2015 by type Association, or TAPA, standards Supplier data does not include Elanco, our materials are monitored weekly to into our security framework. We animal health division, and those suppliers that allow for proactive intervention, as do not supply goods or services under a purchase actively monitor our supply chain needed, to avoid any interruptions order or contract. using TAPA standards to ensure a of supply. To supplement these in- high level of performance for our ventory action plans, we also have transportation carriers and ware- additional mitigation plans in place Tier A (~5,967) Tier B (~4,108) Tier C (~250) house and distribution centers. for our drug product components, Includes suppliers deemed Includes suppliers deemed Includes suppliers deemed including materials critical to to pose a lower risk for to pose a medium risk to pose the greatest risk for supply chain interruptions. for supply chain interrup- supply chain interruptions. manufacturing finished drug prod- Pharmaceutical These include vendors pro- tions. Suppliers in this tier Suppliers provide active ucts. For these components, we viding goods and services provide raw materials and pharmaceutical ingredients, have identified secondary sources across general business other common commodi- including specialty chem- and maintain additional inventory Industry Principles for functions, including mar- ties used for primary and icals. Suppliers in this tier in our supply chain. This analysis Responsible Supply keting and sales, general secondary packaging, include contract manu- has permitted us to further refine research and development as well as logistics and facturers and analytical our overall risk strategy. activities, travel services, manufacturing operations. services for research and Chain Management information technology (IT) These include packaging development. Shipping pharmaceutical prod- The Pharmaceutical Supply Chain equipment, catering, and materials, waste disposal ucts requires extra precautions other routine services. services, and energy. Initiative (PSCI) is an industry body that typical freight shipping does formed by the pharmaceutical sec- * In 2015, Lilly used the services of approximately 10,325 key suppliers of materials and not, including precise temperature tor whose members share a vision services to support our pharmaceutical business operations. Due to changes in our supplier controls. Shipments of medicines to establish and promote respon- classification system, this number excludes suppliers that did not provide goods or services can also be subject to tampering under a purchase order or contract (non-purchase order suppliers) and also excludes our sible practices that will continu- Elanco animal health division, including those suppliers that supported operations related and interference from drug coun- ously improve the sustainability of to the acquisition of Lohmann SE (Lohmann Animal Health) and Novartis Animal Health. For terfeiters, leading to very serious supply chains serving the sector— comparison purposes, our 2014 report featured a much larger total number of suppliers be- consequences. Therefore, the cause it included non-purchase order suppliers and suppliers to Elanco. The 2014 figure did including social, health, safety, and not include suppliers associated with both Lohmann SE and Novartis Animal Health. We have recategorized the way we present these numbers because non-purchase order suppliers are not actively managed as part of Lilly’s supply chain processes.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 83 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
environmental outcomes. PSCI’s Lilly’s participation in PSCI has supplement our own supplier as- to help pharmaceutical suppliers mission is to provide members provided a much appreciated sessment process. Through this better understand and improve with a forum to establish industry opportunity to engage with our process, we have been able to help social and environmental practices principles that guide ethics, labor, PSCI colleagues around supply our suppliers improve their inter- across their own supply chains. health and safety, environmental chain management, and we have nal capabilities by identifying areas For example, PSCI held a sup- sustainability, and management found much common ground in our for improvement. plier conference—“Business with systems practices to support con- collective support for the values that Balance”—in Mumbai, India, in Vendor trainings for knowledge tinuous improvements of suppli- PSCI advocates. Our involvement September 2015, bringing together and capability building – Lilly has ers’ capabilities. Lilly joined PSCI with PSCI has helped us to sharpen more than 200 colleagues, rep- also participated in webinars and in 2009 and remains an active our supply chain management prac- resenting 70 manufacturing, API, workshops, facilitated by PSCI, member, aligned to the goals of tices and delivered business value the organization. through enhanced understanding of the environments in which our PROTECTING THOSE WHO TAKE OUR MEDICINES BY SECURING OUR SUPPLY CHAIN As part of PSCI, Lilly is committed vendors operate. PSCI has also pro- to following the Pharmaceutical vided Lilly with some valuable tools, Industry Principles for Responsible Taking the right medication at the right time is a critical piece of a person’s overall health. With including the following: a complex supply chain and an increasing threat from counterfeit medicines, the pharmaceutical Supply Chain Management, which industry has a great responsibility to make sure that all medications are manufactured, packaged, PSCI created together with its Common auditing practices – As and distributed in a precise, controlled manner—ensuring that the medications people take are of member companies. These prin- our industry increasingly adopts the highest purity and quality. When someone receives a medication with the Lilly name on it, we ciples were established to provide the standardized PSCI question- want that person to be confident it is a legitimate product that contains the medicine prescribed for the pharmaceutical industry with naires, our suppliers can more him or her. a consistent standard of measure- easily anticipate questions we ment for vendors in the areas of might have about their practices To help protect Lilly’s medicines from being tampered with and to respond to increasing interest ethics, labor, health and safety, the and learn to manage their oper- in, and requirements around, the traceability of pharmaceutical products, Lilly has invested in environment, and related man- ations with the rigor required by serialization technology. Serialization is the use of globally unique codes that are assigned to, and agement systems, and they were Lilly and other major manufacturers. physically marked on, individual packs (cartons or bottles) of medications. Serialization technol- ogy can help automate the checking of expiration dates, link batch numbers of specific medicines designed to be consistent with the These questionnaires cover adher- in a patient’s electronic medical records, and help secure the pharmaceutical supply chain against United Nations Global Compact. ence to high standards of HSE per- counterfeit medicines by establishing a chain of custody for the medications or allowing verifica- The principles themselves and re- formance, labor practices, human tion prior to dispensing to a patient. lated information can be found at rights, and ethics. As part of this the PSCI website. work, Lilly is using shared audits We are investing tens of millions of dollars in our packaging operations, distribution centers, and performed by PSCI members to IT infrastructure to support serialization—including new technology deployments on more than 30 packaging lines around the world. See Assuring Quality Medicines to read more about our efforts around product serialization and traceability.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 84 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
SUPPLIER DIVERSITY and purchasing decisions as they Lilly’s expectation is that our relate to the minerals at issue. suppliers will source their materi- Lilly aspires to broaden the participation of small and diverse businesses in our supplier network. als responsibly and abstain from In 2014 and 2015, Lilly filed annual Engaging with diverse suppliers delivers value and creates a competitive advantage for Lilly by procuring materials from areas reports with the U.S. Securities linking the external capabilities of ethnically diverse, women-owned, and small businesses to or sources that might promote and Exchange Commission (SEC) Lilly’s internal business needs, helping to spur innovation and creativity. In so doing, we are bet- conflict in the DRC and that our relating to the conflict minerals ter able to understand and connect with those we serve. To learn more about Lilly’s approach, see suppliers conduct their own due rule, under which companies our supplier diversity discussion in the Workplace section of this report. diligence regarding the source of describe whether products any materials they provide to us in that they manufacture or have order to ensure those materials contracted to manufacture contain and chemical suppliers. Over a Conflict Minerals are conflict-free. We filed our certain defined minerals and three-day period, the suppliers Lilly is concerned with the variety of latest Conflict Minerals disclosure whether those materials may have addressed labor and ethics issues, human rights violations that occur documents with the SEC in May come from sources in the DRC as well as environmental health throughout the world. We are 2015. The company will file our region. As a part of that reporting and safety topics, such as indus- aware that the ongoing conflict in next conflict minerals disclosure process, we examine the raw trial hygiene, pharmaceuticals in the Democratic Republic of Congo documents in late May 2016. material content of all of our global the environment, wastewater man- (DRC) and the surrounding coun- commercial products and seek to Lilly is committed to continue to agement, hazardous waste dis- tries is understood to be financed, identify the origin and source of understand the origin of these posal, and process safety. Further in part, by the mining and trade of these raw materials. Our goal is to materials and will take appropri- workshops in other global loca- certain minerals, including tung- develop a better understanding of ate action to avoid the inadvertent tions are planned for 2016 to cover sten, tantalum, tin, and gold. We the supply chain and to avoid the support of businesses associated topics of interest in both global and are committed to making every inadvertent support of businesses with human rights violations. regional environments. effort to ensure we understand associated with human rights our supply chain and the potential violations. upstream impacts of our supply
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 85 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
TRACKING LILLY’S MEDICINES THROUGH Counterfeit THE SUPPLY CHAIN
Lilly is working closely with other organizations Medicines to advocate for common serialization standards in the United States and around the world. These standardization efforts will help doctors, pharmacists, and patients trust the legitimacy Counterfeit medicines, often pro- of the medicines they prescribe, dispense, and duced and distributed by global receive. See Assuring Quality Medicines to criminal networks, are an increas- learn more about Lilly’s use of serialization. ing threat to patient safety, and today they constitute a multi-billion dollar industry. Counterfeit medicines have been Working to Deter found in all therapeutic areas in Counterfeiters Online every region of the world. Their across borders using conventional made a sustained, long-term com- impact is wide-reaching and po- and unconventional trade routes mitment to address this problem. and In the Field tentially deadly, both due to toxic and shipping methods that change Our anti-counterfeiting strategy is substances sometimes found in frequently in response to regula- composed of three key objectives: After reviewing 11,000 Internet the counterfeit medicines and be- tory and law enforcement actions. drug outlets, the National Asso- • Securing the integrity of Lilly cause they undermine a patient’s Products are often made in one ciation of Boards of Pharmacy medicines through the legitimate confidence in legitimate medicines country, trafficked through other (NABP) found that 96 percent supply channels; and the credibility of healthcare countries, and ultimately sold to of them were not in compliance providers. Lilly employs a variety consumers in yet another country. • Deterring major counterfeiters with federal and state laws or the of anti-counterfeiting tactics for of Lilly medicines through NABP’s safety and best practice Ensuring that patients can con- 1 our medicines and is actively en- targeted investigations, Internet standards. And yet the U.S. Food tinue to benefit from safe med- gaged in efforts to combat coun- monitoring, and legal actions; and and Drug Administration (FDA) icines requires innovative ap- terfeiting to protect patients and notes that nearly 1 in 4 Internet proaches to expose and outwit • Partnering with governments, the Lilly brand. users has purchased prescription counterfeiters—and a broad, non-governmental organiza- tions, and trade associations Historically, counterfeiting has af- coordinated effort among many 1 National Association of Boards of Phar- fected many developing countries. stakeholders to give patients con- to raise awareness and to macy. “Internet Drug Outlet Identification Program Progress Report for State and Increasingly, it is a global problem. fidence in the safety and efficacy of strengthen, enact, and enforce anti-counterfeiting laws. Federal Regulators.” Last accessed De- Counterfeit medicines are exported the medicines they take. Lilly has cember 13, 2015.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 86 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
medication online.2 The vast ma- patients through legitimate EU jority of pharmacy websites do supply chain channels. In addition, not require a valid prescription to we support prosecutors and other sell a medicine; others issue an law enforcement personnel in the on-the-spot “prescription” after a criminal prosecution of counter- visitor completes an online ques- feiters around the world by gath- tionnaire. This setting provides the ering evidence, testing samples, perfect haven for counterfeiters to testifying in court, and filing civil sell counterfeit and illegal medi- actions. Lilly also participates in cines. We are deeply engaged in the World Customs Organization’s efforts to close off such illegiti- Interface Public-Members (IPM) mate channels on the Internet. database, a secure online tool serving as an interface between Lilly collaborates with various front-line customs officers and stakeholders to educate patients the private sector. IPM is used by on the dangers of counterfeit customs agents globally to help medicines, to raise awareness identify counterfeit products that broadly, and to encourage policy cross national borders. makers to address this issue. We the global response to pharma- fake medicines. The campaign also work collaboratively with ceutical crime, and build partner- gives a voice to those who have European stakeholders (pharma- ships across sectors to fight the been impacted personally by coun- cists, wholesalers, and parallel Partnering With Global threat of counterfeit medicines. terfeit drugs and shares the sto- distributors) to implement the One significant operation aided by ries of those working to put a stop European Union (EU) Falsified Stakeholders this initiative in 2015 involved 236 to this threat to public health. It Medicines Directive. The Directive In 2013, Lilly joined with INTERPOL law enforcement agencies and 115 seeks to build a global movement regulates pharmaceutical sup- and 28 of the world’s leading countries. It resulted in more than of organizations and individuals ply chains and monitors activity pharmaceutical companies to 156 arrests globally and confis- who will shine light on the negative to help prevent counterfeit med- launch a landmark agreement to cation of potentially dangerous impact of counterfeit medicines icines from being dispensed to combat counterfeit medicines. The medicines with a value of nearly and serves as a resource for those three-year initiative was funded by $81 million (USD). looking to support the effort. 2 U.S. Food and Drug Administration. “FDA a combined investment of nearly Campaign Aims to Protect Consumers $5.9 million from the companies Lilly also endorses the Fight the from the Risks of Fake Online Pharmacies: Survey Data Shows Lack of Confidence in involved. It helped INTERPOL to Fakes campaign (www.fightthe- Purchasing Drugs over the Internet.” Press disrupt criminal networks, provide fakes.org), which aims to raise Release. September 28, 2012. Last ac- training to agencies involved in cessed December 13, 2015. awareness about the dangers of
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 87 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Lilly’s Approach to whole blood assays that can re- We also believe it’s important to Animal Care duce or replace the traditional use engage with others to advance Animal Testing of whole animals in research. For our own understanding of, and to Lilly embraces the industry stan- instance, we use primary intestinal promote the ethical treatment of, and Use dard for the ethical treatment of cultures to screen potential diabe- animals in research. Nationally, we animals known as the 3Rs. This tes compounds rather than relying participate in the 3Rs Leadership approach prioritizes strategies solely upon testing in rodents. Our Group at the Innovation and Quality for the reduction, refinement, and researchers have also developed Consortium. We also participate in Animal studies are a critical com- replacement of animal use within ponent in the discovery and devel- a non-animal, chemical-based or collaborate with the American biomedical studies conducted on assay using whole blood as a Association of Laboratory Animal opment of innovative medicines behalf of Lilly. for both humans and animals. In replacement for routine testing Science, the American Society human biomedical research, ani- We continually work to integrate in animals. In addition, significant of Laboratory Animal Practi- mals have significantly contributed the 3Rs into the processes and efforts are underway in our Elanco tioners, the American College of to the development of lifesaving practices used by Lilly and third division to use non-animal assays Laboratory Animal Medicine, and treatments in the areas of can- parties on our behalf. Since we rather than live animals to test the American Veterinary Medi- cer, diabetes, vaccines, high blood established a formal 3Rs initiative certain vaccines. cal Association, among others. pressure, and neurological disor- in 2012, we have seen advances in ders, to name just a few. Similarly, several areas. Using the 3Rs prin- in the world of animal medicine, ciples, Lilly scientists are working WHY DO WE CONDUCT STUDIES ON ANIMALS? animal studies have been instru- to improve the predictive value of mental in developing effective computer models to reduce the Regulations govern the approval of all new medicines. These regulations dictate that all poten- and safe products that help as- number of animals needed. For tial treatments be evaluated in research animals prior to testing in humans or in the animals sure animal welfare, further the instance, in neuroscience, we can for which they are ultimately intended. The reason for this lies in the complexity of the living human-animal bond, and ensure use PET-like methodologies (sim- organism. The interface between physiology, biochemistry, and immunology cannot be generated artificially. Human and animal biology is so complex that current non-animal research models healthy animals that are raised ilar to clinical PET-imaging tech- simply cannot tell us all we need to know about how a potential new treatment will function in a for food (such as fish, poultry, and nology for people) with rodents living organism. Therefore, without some animal experiments to understand the safety and effi- livestock). We believe we have a during the discovery process to cacy of potential medicines, it would not be possible to bring these new medicines to the people determine if the target in the brain moral, ethical, and scientific re- and animals that need them. sponsibility to ensure the welfare is being engaged. If there is no of animals used in research, and effect, we know that it is unnec- All animal studies at Lilly—including those conducted for Lilly by third-party facilities—are we have strong principles and pol- essary to test that chemical or carefully evaluated as to whether they are needed, the number of animals used, and the species icies in place to ensure that animal biological entity further. used, in addition to the comfort of the animals before, during, and after the study. We have estab- research at Lilly is conducted in lished company guidelines for the use of non-human primates. Lilly has not used chimpanzees in Lilly scientists have also estab- research since the late 1980s, and careful consideration to alternative approaches is given prior line with our values. lished primary tissue cultures or to initiating studies using other non-human primate species.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 88 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Internationally, Lilly has associ- qualified. Members on the over- scientific knowledge, Accreditations and Inspections ations and supporting roles with sight committees undergo intense • Selecting only animals All Lilly-owned animal testing several organizations, including training, and include unaffiliated, appropriate for that study, facilities for human drug develop- the European Federation of Phar- members of the public. • Using the minimum number ment are accredited by AAALAC, maceutical Industries and Associ- an organization that has set the ates, the Federation of European of animals required to obtain valid results, internationally accepted, indepen- Laboratory Animal Science Asso- Lilly Animal Care and Use dent standard that helps confirm ciations, and the National Center Policies and Principles • Using alternative methods appropriate animal care and use. for 3Rs, among others. All personnel conducting studies for instead of live animals where Company-owned animal testing appropriate, and Lilly sites that conduct animal Lilly must adhere to the following facilities focused on testing for our research worldwide have ethical principles, which provide the founda- • Avoiding or minimizing discom- Elanco division have also adopted oversight committees and stay tion for our care and use of animals: fort and distress to the animals. the high standards used by AAA- LAC. Lilly also uses the services of closely aligned with local regu- Living conditions In addition, personnel must comply for research third-party facilities located at var- latory requirements to approve animals must be appropriate for with our global policy on animal all animal care and use activities care and use, which covers com- ious sites around the world. These their species and contribute to third parties include contract re- and to ensure that people work- their health and well-being. pliance, design and conduct of ing with animals are appropriately animal studies, care of animals, search organizations or third-party Personnel who care for animals training of personnel, reporting operations that conduct research or who conduct animal studies concerns, and contracts with on behalf of Lilly, supply animals ENGAGING EMPLOYEES must be appropriately qualified for animal suppliers and research to Lilly, or supply feedstuffs to ani- the proper care and use of animals service providers. Personnel must mals at Lilly. In 2015, Lilly’s Bioethics Program and our Ani- in research. also follow other related animal mal Research 3Rs Initiative co-hosted a com- All animal facilities are subject to research policies that apply to panywide week of awards, lectures, presenta- Studies involving animals must be external review and inspection. tions, and discussions related to both human designed and conducted in accor- their particular area of expertise. In the United States, our facilities and animal bioethics. The sessions related to dance with applicable country and Our policies and standards are are subject to unannounced site the ethical care and use of research animals local regulatory guidance and the based upon the U.S. Government inspections by the U.S. Depart- was a great opportunity for us to engage em- following widely recognized princi- Principles for the Utilization and ment of Agriculture. In Europe and ployees who don’t work with animals every day ples of animal care and use: Care of Vertebrate Animals Used Australia, local and national and to spur thinking and discussions about this authorities regularly inspect in Testing, Research, and Training. important issue. For more about Bioethics Week • With due consideration of the study animal facilities. In addition, we and our approach to bioethics more broadly, see relevance to human or animal self-inspect regularly, including the Bioethics section of this report. health and the advancement of semiannual program review and
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 89 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
facility reviews. In situations where we have recently acquired another company, we work closely with that group to ensure that animal wel- fare standards align with our policy and principles. We also maintain a global oversight program of all animal research and supply com- panies that we do business with, including visits by trained spe- cialists to conduct animal welfare program and facility audits. Lilly requires all employees and all third parties involved in our research to adhere to all applica- ble country and local laws, regula- tions, and standards regarding the care and use of animals. Moreover, we require Lilly researchers and contractors to adhere to the Lilly Animal Care and Use Principles, even if these principles are more stringent than applicable local laws. Lilly also encourages animal research and animal supply com- panies globally to obtain and main- tain accreditation from AAALAC. More information about our com- mitment and activities in this area is available on our Animal Care and Use webpage.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 90 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
lifelong learning, prizes inclusion While our company’s programs EMPLOYEES (AS OF DECEMBER 31, 2015) Workplace of diverse experiences and per- vary around the world, we take a spectives, and offers compensa- holistic approach to our employee Indianapolis tion and benefits that reward their benefits. These may include flex- 10,840 dedication and hard work. ible work arrangements; on-site In 1882, when his son, J.K. Lilly, Sr., conveniences, such as cafes, Indiana first became the superintendent fitness centers, and child care; 1,214 (excluding Indianapolis) of the laboratories, our founder, A Culture of Well-Being competitive time-off programs; Colonel Eli Lilly, charged him retirement benefits; and health Our work environment encourages United States to “Take what you find here and and disability programs that are employees to strive for greater 5,603 (excluding Indiana) make it better and better.” Those available for employees when they personal well-being to enable words have had a significant need support. In some locations, them to contribute to the health impact on our company for its certain benefits are extended to Outside United States and productivity of Lilly—and to 140-year history and continue to family members. 23,292 motivate us today—driving our the patients we serve. We want 41,000 employees to search for our company to be a place where Worldwide Total innovation each day. Whether this our employees enjoy meaningful A Coaching Culture 40,949 takes the form of discovering med- work, build successful careers, icines, finding new ways to support and make important contributions Lilly is poised for growth. To support Employees Engaged in patients, or aiding our communi- to society. that growth, our employees need 8,627 Lilly R&D Activities the work environment, coaching, (including scientists ties, we, too, strive to make things We recruit through professional and skills to be successful in the and additional staff) better and better. networks, career forums, edu- years to come. There are many unmet medical cational institutions, and digital needs—among them, Alzheimer’s media channels to find candidates We are committed to creating a These efforts directly support the disease and many types of can- who are passionate about pursu- coaching culture—one that em- major shift made in 2014 to simplify cer. We don’t know who is going ing a purposeful career that helps phasizes ongoing, quality conver- our performance management to discover the next great medical improve lives around the world. sations between supervisors and process and provide a framework employees—to help employees breakthrough, and we need all the For our employees, we support a that supports and encourages our learn, grow, and make progress in best minds possible to help find culture of well-being by providing mindset of “helping people doing their work. In 2015, we completed solutions to these complex diseases. competitive pay, comprehensive good work get even better,” in the a global coaching initiative where That’s why we focus so intently employee benefit programs, train- words of our CEO, John Lechleiter. supervisors dedicated 25,000 on attracting a diverse, talented ing and development resources, This simplified approach encour- hours to building their coaching workforce and then providing our and opportunities for them to serve ages our employees to prioritize skills through online learning and employees with an environment in their communities and around and focus their efforts to align with in-person skill-practice workshops. that fosters innovation, encourages the world. our goals for the business overall.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 91 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
These employees are provided In addition to our annual survey, small group of employees, now Learning and development opportunities in their we also rely on external bench- has 29,100 active users. Available organizations to grow in their lead- marking data and other inter- to all employees, the online forum Development ership capability. We also conduct nal surveys and focus groups to has helped our employees find ex- To further support our employees, leadership retreats globally for inform our decision-making. For perts within the company, expand we strive for a culture of lifelong employees who represent diverse example, we have recently con- internal professional networks, learning, encouraging employees talents and backgrounds. ducted an extensive study involving and make new friends. our female employees to better to seek ongoing education and Many of our employees have in- understand the progression of growth as a strategic element of dicated they value working for a their careers. This information will their career at Lilly. Listening to Our company that devotes significant help determine and influence the time, dollars, and resources to We recently launched Lilly U, an factors that impact their careers Employees community programs and volun- online professional development at important decision points. With We are a scientific company—and teerism. Connecting Hearts Abroad portal for all employees. This on- this knowledge, we hope to ad- data is at the core of our business. is an example. Since the launch of line portal is always open, making vance the career progression of Data also is essential as we develop this program in 2011, nearly 1,000 it easier for employees to pursue women at Lilly. professional development on their programs and make decisions about Lilly employees have served as own time and at their own pace. our work environment. One way we Connecting Hearts Abroad ambas- In addition to training classes, gather information is through an Employee Engagement sadors, volunteering on company employees can use Lilly U to find annual all-employee survey. time for two weeks in some of the Effective employee collaboration world’s most impoverished com- reading recommendations, ref- We ask our employees questions is critical to Lilly’s success, and munities. Many of the participants erence materials (such as white related to their work environment, we use a variety of programs and describe their experiences as “life papers, presentations, and internal including their feelings about their tools to engage our employees and changing” and feel they return as websites), videos, and practical work, their group, management to foster and promote teamwork. better, more connected employees ideas for ways to extend what they overall, and customer focus and and stronger leaders. learn into real-life situations. service. In addition, the survey asks One popular tool is The Loop, Our succession-management our employees to provide their per- an internal social networking Another area we’re particularly process identifies individuals who ception of the leadership behavior of site that offers our employees a proud of is our work supporting we believe have the ability to lead their direct supervisor and includes platform for collaborating across science, technology, engineering, at higher levels. Supervisors from questions related to our leadership teams, functions, and geogra- and mathematics (STEM) educa- each division assess employees principles of connecting with peo- phies. Through it, our workforce tion initiatives. As a company built in their organization to determine ple, being determined, and driving can tap into each other’s expertise, on scientific discovery, we recog- which individuals have the poten- continuous improvement. insights, and creativity. The Loop, nize the important role that early tial to take on more senior roles. piloted in the fall of 2010 with a education programs in STEM play
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 92 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
in preparing children for scientific FOSTERING INNOVATION BY CREATING A CULTURE OF INCLUSION DIVERSITY AT LILLY careers. We provide funding and volunteers for a number of school At Lilly, we encourage leaders to engage their teams and to create an environment where employees programs in our home state of are motivated and empowered to contribute to innovative solutions. We train leaders in key Indiana. In addition to aiding in the principles that emphasize connection, determination, and continuous improvement to help them education of young people, our fuel creativity and incubate leading-edge ideas. efforts are also helping to develop a future pipeline of potential talent Diversity and inclusion are key pieces of this puzzle. First we must establish teams with a diverse 2015 U.S. for our own company. representation of backgrounds, training, and experiences, and then we must move beyond that diversity to true inclusion—creating a workplace where employees feel comfortable bringing their Workforce See the Strengthening Communities “whole selves” to work and where their unique perspectives contribute to Lilly’s success. Watch section of this report for more a video to hear our employees talk about the importance of their voices being heard. about our volunteer efforts, includ- Leaders clearly play a critical role. Well-managed, diverse workgroups are more effective than those ing Connecting Hearts Abroad, our with little diversity.3 We emphasize inclusive leadership among our supervisors—pushing them to Global Day of Service, and addi- create an inclusive culture by seeking out, developing, and leveraging the diverse perspectives of tional examples of our STEM work. their teams to enhance the impact those teams have on our business. 21% Minority Employees Because inclusive leadership is becoming such an important focus area for us, we are including the Diversity and Inclusion principles in leadership training, conferences, and diversity and inclusion training across our operations. As a global company in the 21st 8% Asian century, we believe diversity and opportunity, whether hiring inter- starts with robust projects that inclusion are critical elements nally or externally. We track and address complex business chal- that enable success. An inclusive regularly review our progress. lenges. For Indianapolis-based African American culture helps to drive the scientific, interns, there are numerous 7% Our recruiting initiatives include clinical, and customer insights that opportunities to learn about Lilly, maintaining a presence at top col- fuel innovation. explore the city, participate in leges and universities and working social activities, and interact with 4% Latino A focus on diversity is built into our with a wide range of diverse pro- people at all levels within the com- talent-management processes, fessional associations. We also pany. Globally, we offer an exten- from recruiting, to staffing, to attract top diverse talent through sive MBA internship program in 20 Two or more races learning and development, to suc- the Lilly internship program, which 2% Lilly locations around the world, cession management. Supervisors with an emphasis in the United are encouraged to consider di- 3 Catalyst Information Center. “Why States, China, and Japan. verse candidates for every staffing Diversity Matters.” 2013. <1% Native American
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 93 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Hiring a diverse workforce is the To hear from Lilly women first, important step. But moving beyond diversity to focus on an in- from around the world, please clusive culture is equally important. see the blogs and videos at At Lilly, we work hard to foster this lillypad.lilly.com/women.php. culture through these actions: • Stressing the importance of inclusive leadership with our one of DiversityInc’s Top 50 Compa- supervisors, nies for Diversity. We were also honored that year as a top company • Supporting our Employee Re- for lesbian, gay, bisexual, and trans- source Groups and empowering gender (LGBT) employees; women; them to make contributions vital and current and former military. (For to our company’s success, and a full list of awards, see page 99.) • Providing opportunities for employees to openly discuss and examine topics of diversity Global Diversity Initiatives (e.g., at our European Diversity We understand that the concept Summit and the discussion panel of diversity means different things our African American Network around the globe. Our leadership “We don’t have a person or a talent to waste. A culture hosted titled “Can We Talk? teams across the world formulate Navigating Hot Topics in the their diversity strategies by con- of inclusion is about making sure every person who Workplace”). sidering our corporate perspective works at Lilly feels comfortable, valued, and respected. As a company whose culture is and then customizing their own built on improving the lives of oth- plans based on local demographics That’s when people give you their best. Do we have that ers, being recognized for our work and culture. to promote diversity and inclusion culture today? If you ask me … we’ve come a long way, Many of those programs focus on in our workforce is an honor we the hiring, retention, and career de- value highly. Year after year, Lilly but we still have work to do.” velopment of women. Some of our has been recognized as one of the results have led the industry. We — John Lechleiter, Ph.D., Chairman, President, and Chief Executive Officer top companies in the United States were honored to be named as one for our commitment to diversity of the 50 Leading Companies for and inclusion. In 2015, for the fifth Women in the Asia-Pacific Economic consecutive year, we were named
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 94 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Cooperation region and beyond for GENDER DIVERSITY AT LILLY 2015 IN THEIR WORDS our efforts to increase women’s leadership roles in the workplace. Attendees at our European Diversity Summit told us what diversity at Lilly means to them. For example, in Japan in 2004, we introduced the first phase of a “females in leadership” diversity There are four strategy. Since then, we have refined women on the board this strategy to include the estab- of directors—about 29% When you think about our need to innovate, better lishment of a diversity council and decision-making comes down to understanding the key the introduction of new programs The average for * to develop female leaders. Culture Fortune 500 companies principles around diversity and inclusion. change takes time. Progress has is just under 20% been slow, yet steady, as Lilly Japan – Jackie Hardwick, Associate Director of Marketing Toronto, Canada works to increase the number of Lilly also has four women in leadership roles. Lilly women on its executive 29% Japan implemented a number of committee—also new programs, including childcare Leadership positions I’d really like to encourage people Let’s have a conversation about our support and expanded work-from- to get on board, ask the questions, differences. Not to necessarily end up ** home programs, among others, to 63% 37% and find out what people in our on one side or the other, but to make make our company more attractive for men women women. Since we began this initia- organizations need to feel included. a friendlier environment. tive, Lilly Japan has made the “Best Global workforce – Leanne Marran, Region HR Head, Elanco – Karolina Patocki, New Product Planning Companies to Work For” list. Basel, Switzerland Manager, Alcobendas, Spain In addition to a focus on women, 53% 47% our affiliates tailor their plans men women based on other demographics. For example, some build plans related U.S. workforce Diversity is more important than ever in a rapidly changing to provincial, generational, and disability diversity. In 2015, our 53% 47% and very diverse world. It attracts people. It helps us to affiliates in Europe and Canada men women made significant efforts to accel- make better decisions and have better discussions. erate their progress in diversity * 2020 Women on Boards. 2015 Gender Diversity Index. – Sigrid Grundmann, Legal Director and inclusion efforts by organizing ** Percentage of women who supervise Bad Homburg, Germany a two-day European Diversity others or hold high-level strategic roles.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 95 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Summit in the United Kingdom, • Increasing education about • Establishing a European diversity their members and help our com- which was attended by individuals diversity and inclusion, including and inclusion council; pany develop talented individuals representing 14 countries. a focus on personal biases • Increasing affiliate-level initia- for future leadership roles at Lilly. and how they can affect our Participants took new ideas and tives, such as training sessions, In recent years, they have been decision-making; initiatives that originated at the adding diversity and inclusion to expanding their grassroots activi- summit back to their local offices, • Increasing partnerships with meeting agendas and business ties into areas that will have more including the following: external organizations to deepen updates, hosting external speak- direct business impact, becoming corporate knowledge of diversity ers, and evaluating policies to even more vital to our company’s • Strengthening the EuroPRIDE and inclusion (e.g., we became assess inclusiveness; and success. For example, our ERGs organization and creating a global partner of Stonewall to • Creating a quiet room for prayer, participate in recruiting events resource groups focusing on learn more about LGBT work- meditation, reflection, and related with colleagues in human re- gender inclusion and people with force issues around the world); activities at two Lilly locations in sources to help attract interns and disabilities in Europe and Canada; the United Kingdom. new employees from universities and career fairs. They frequently consult on marketing and work- Employee Resource Groups (ERGs) place programs and help to serve SCIENCE HATES BIAS Our ERGs support a richer, more as language interpreters during inclusive workplace culture and company meetings. They also “In science, bias is dangerous. Even if unintentional, scientific bias alters conclusions and can partner with the business to help assist with corporate executive negatively impact the direction of future scientific approaches, assumptions, and thinking. At us better serve customers. They best, it takes us off-course and wastes time. And bias when dealing with other people can be training programs on topics such damaging and hurtful. offer strong support networks for as cultural bias and inclusion. In Bias in many forms will always be with us. But when we shine a light on diversity, bias retreats into the shadows. Working with people from diverse backgrounds is one of the parts of my job FREEDOM OF ASSOCIATION that I love the most. As many scientists will tell you, the best scientific discovery is never a straight line. Instead, it’s multi-branched and requires diverse inputs, creative problem-solving, Lilly recognizes the importance of freedom of association in the workplace and respects the right and a healthy amount of skepticism and debate along the way. of our employees to join associations of their own choosing. We interact with works councils and unions in several countries outside the United States; we support these bodies and work pro- Diversity in science and research is not just a “nice to have” thing. It is essential to opening our ductively with them. The vast majority of our workers globally are not covered under traditional eyes and our hearts to bold solutions, without bias. Let’s encourage diversity of all kinds, particu- collective-bargaining agreements. In some countries where we operate, governments mandate larly when we need major breakthroughs for urgent medical needs.” working conditions, such as salary increases, minimum wages, bonuses, number of weekly working hours, vacation time, and overtime rates. These vary by country, and we follow these — Farhana Merzoug, Ph.D., is a principal research scientist at mandates wherever they are required. Several of our affiliates have employee councils that meet Lilly whose work focuses on preclinical oncology tailoring. monthly with management to discuss workforce-related issues that directly impact them, such as company policies and organizational changes.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 96 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
ADDRESSING THE NEEDS OF MILLENNIALS ERG and already boasts more than connect with colleagues at all EMPLOYEE RESOURCE GROUPS 2015 650 members in the United States. levels of the company on a daily As we build the workforce that will take us The group fosters professional basis. Other companies are repli- Employee resource groups are critical into the future, we are listening and respond- development for employees who cating the panel. in driving our diversity and inclusion ing to the needs and interests of millennials. are early in their careers and pro- Maintaining a global outlook, the strategy across our company. In 2015, we assembled a cross-functional vides opportunities to reach out to Lilly Chinese Culture Network group of millennials to identify opportunities the community through social and stays abreast of our job openings for us to do more to attract, develop, and service-based activities. retain their peers. in China to help recruit qualified Employee The African American Network Chinese American employees or 10 Resource Groups Members used work groups, surveys, focus is Lilly’s longest-standing ERG. It their friends and family members groups, and benchmarking to assess and hosts an annual African American who already live in China. The net- define the values, experiences, and career Forum attended by 800 employees, work also offers cultural aware- development aspects that are most important coordinates activities for our em- ness training classes for U.S. Lilly to their generation. In 2016, we will begin Members acting on those recommendations. See below ployees during Black History Month employees who are preparing for 12,500 to learn more about our new Early Career each year, builds relationships with work assignments in China or Professionals ERG. historically black colleges and uni- working closely with colleagues versities to encourage recruitment there. The Lilly India Network of African Americans for positions offers similar training, in addition Satellite addition, they provide employees at Lilly, and helps to promote to community cultural programs. 60 Groups Globally diversity in Lilly’s clinical trials. preparing for global assignments The Organization of Latinos at Lilly with a better understanding of the In 2015, the Network partnered (OLA) ERG is very active in local language and culture of the coun- with John Gates, Ph.D., a diversity communities, building Lilly’s repu- tries in which they will work. consultant and writer, to moder- tation among the Hispanic popula- Internal About 12,500 Lilly employees are ate a discussion titled “Can We tion in Indianapolis where Lilly is 13,000 Volunteer Hours members of at least one of our 10 Talk? Navigating Hot Topics in the headquartered and getting in- ERGs, which feature more than Workplace.” This event featured volved with organizations that align 60 chapters located at Lilly offices a respectful discourse on the with Lilly’s commitment to STEM around the world. The following controversial police shootings in education. One of OLA’s key part- External are just a few highlights from the Ferguson, MO, New York, NY, and nerships is with Project Stepping 8,000 Volunteer Hours past year. other cities. The honest conversa- Stone, which provides opportuni- tion was a breakthrough for many ties for young students to see that Formed in 2015, the Early Career employees about what it means to a college education is achievable Professionals group is our newest be authentic at work and to better even when sometimes it seems
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 97 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
out of reach. Every year, OLA In response to RFRA, Lilly led a WHAT AN EVOLUTION works with Project Stepping Stone coalition of businesses to encour- to organize an event at Lilly where age elected officials to add lan- “When I moved to Indianapolis almost 16 years ago, I was a nervous, excited 23-year-old in a Latino students partner with Lilly guage to the legislation to ensure new city with no family and no friends—just a new job. I remember, vividly, the energy it took professionals to help improve their it could not be used to discrim- to start this new chapter in my life, especially doing nothing that would jeopardize my career understanding of business and the inate against LGBT individuals. at a big, new company. At the time, that included making sure that no one knew that I was importance of higher education. The so-called “RFRA fix,” which gay. That was June of 2000. also protected local human rights Lilly AMECA (Africa, Middle East, It took me almost a year-and-a-half before I verbally came out to anyone about my sexual ordinances in Indiana cities, such Central Asia) also is working to in- orientation at work, which I felt comfortable doing in large part because of the group that as Indianapolis, Bloomington, crease access to clinical trials in the eventually became the PRIDE ERG. Through the years, although the level of my involvement in Lafayette, and South Bend, was the ERG has varied, one thing has been consistent: Our lesbian, gay, bisexual, and trans- Middle East and conducts an annual ultimately passed. The “RFRA gendered colleagues have supported each other at Lilly. They were all building careers here symposium to educate employees fix” helped Indiana avoid further just like I was, and they did it by bringing their whole selves to work every day. This network about working in those regions. damage to its reputation. provided support to those where they may not have gotten it any place else. I started, a little at a time, to be more open at work. Over time, those colleagues became mentors that molded This controversy also illuminated me into the professional I am today and, ultimately, became friends that I still value. Supporting LGBT Civil Rights the fact that Indiana, along with The passage of the Religious about 30 other states in the nation, In April 2015, I attended the Human Rights Campaign (HRC) awards ceremony in New York Freedom Restoration Act (RFRA) has no statewide civil rights protec- City, where Lilly was recognized along with other companies that received a 100 percent by the Indiana Legislature in 2015 tions for LGBT individuals. Lilly and rating on HRC’s Corporate Equality Index. It was the eighth time Lilly received this recog- nition, but this year held special meaning. As I accepted the award on behalf of Lilly, the sparked unwanted international other businesses in Indiana will Religious Freedom Restoration Act had passed and was signed into law in Indiana. I watched attention about civil rights pro- advocate that these protections as Indianapolis business leaders, including our own CEO, joined to convey that discrimination tections for LGBT individuals in be adopted by the Indiana General in any form will not be tolerated. Indiana. This attention eroded the Assembly. For example, Lilly has reputation of Indiana as the wel- been a leader in the formation of I’m proud to work at a place where diversity and inclusion of all employees are celebrated coming place we know it to be. “Indiana Competes,” a statewide and valued. It makes Indianapolis a great place to work and a great place to live. Fifteen Among other things, this places an coalition of more than 400 Hoosier years ago, I moved to Indianapolis as a shy, introverted young man with a new degree at a unwanted and completely unnec- businesses, to encourage legisla- big company. Today, I’m a mentor and a leader. Indianapolis is proudly my home, and Lilly is essary burden on companies like tive action on making this change proudly my company.” Lilly seeking to recruit and re- to the state’s civil rights law. — Ganesh Ram Sharma is the consultant for analysis, clinical tain great talent from Indiana and development, information and optimization, and chair of around the world. the LillyPRIDE Employee Resource Group.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 98 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Supplier Diversity Administration Small Business Size WORKPLACE AWARDS, 2014-2015 We believe that doing business Standards. We actively seek to ex- with a diverse set of suppliers pand relationships with these types Top Companies for Executive Women delivers value to the company and of suppliers, which we view as an Top Global Companies for Leaders National Association of creates a competitive advantage often untapped source of talent. Aon Hewitt Female Executives for us by linking the fresh per- Since 2005, the U.S. Small Busi- spectives and nimble thinking of ness Administration has recog- ethnically diverse, women-owned, nized us as “outstanding” in our Corporate Equality Index and small businesses to our inter- efforts to promote and maintain Top 25 Most People-Centric Company (perfect score) nal business needs. supplier diversity. In 2015, we spent Enterprise Engagement Alliance Human Rights Campaign Foundation Diverse suppliers are defined more than $573.4 million with 575 as those with at least 51 percent suppliers classified as diverse, woman-, and/or LGBT-owned ownership and control by an ethnic Top 50 Companies for Diversity and a businesses, as well as more than LATINO 100 minority, a woman, or someone Top 10 Company for LGBT Employees $566.8 million with 1,532 suppliers LATINO magazine who is LGBT. Small suppliers are DiversityInc. defined as per U.S. Small Business classified as small businesses.
2020 Women on Boards Best Adoption Friendly Workplaces Winning Company Dave Thomas Foundation “Supplier diversity is really actively including small Corporate Champion and diverse businesses throughout the entire Top 50 Leading Companies Most Valuable Employers sourcing process, ensuring that we are understanding for Women for Military the market, understanding what small and diverse Asia-Pacific Economic Cooperation CivilianJobs.com
suppliers are out there, and then actively ensuring 100 Best Companies Outstanding Rating for for Working Mothers Supplier Diversity Initiatives they are involved in our entire sourcing process.” Working Mother magazine U.S. Small Business Administration – Elizabeth G. O’Farrell, Chief Procurement Officer (21 consecutive years)
For a more comprehensive list of awards, visit www.lilly.com.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 99 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
or even office areas. We work to RECORDABLE INJURY AND LOST TIME MOTOR VEHICLE COLLISION INTERIM GOALS Employee Health and mitigate potential risks as much as INJURY INTERIM GOALS possible through a combination of MOTOR VEHICLE COLLISION Safety, and Wellness * behavioral-based, technical, and RECORDABLE LOST TIME YEAR RATE INTERIM GOAL As a leading developer of medi- process enhancements reaching INJURY RATE INJURY RATE 2014 N/A cines, we aim to make lives bet- each area throughout Lilly. For YEAR INTERIM GOAL INTERIM GOAL example, in 2015, we updated 17% ter, including those of our 41,000 2014 0.85 0.30 2015 our health and safety standard to global employees. Keeping our 2016 16% people safe and healthy—whether reduce the risk of serious injuries 2015–2016 0.80 0.30 15% at home or at work—is one of and fatalities, broadened the scope 2017–2018 0.75 0.25 2017 of our employee safety culture our highest priorities and aligns 14% 2019–2020 0.70 0.25 2018 directly with our company values survey, and placed an increased of integrity, excellence, and re- focus on the importance of office 2019 13% spect for people. Our philosophy is ergonomics. 2020 12% rate.4 These goals were developed that no employee should be hurt In 2015, our global health, safety, to reduce our injury rates across a while doing his or her job at Lilly and environment (HSE) team was seven-year period: 2014–2020. or Elanco. Since we introduced our actively involved in integrating that is involved in a collision. This global safety metrics in 2007, our manufacturing and research sites We also established a new goal for measure includes collisions that injury rate has declined by nearly from Novartis Animal Health and measuring motor vehicle collisions result in occupational injuries, as 40 percent, resulting in the pre- Lohmann SE, both of which Elanco in 2015. Previously, our measure well as those that do not, such as vention of hundreds of injuries to recently acquired. Injury data from had been collisions per million slow-moving collisions that occur Lilly employees across the globe. each of these new sites have been miles (CPMM); however, we found in parking areas. We realize that the journey toward factored into Lilly’s data. that this measure was not easily safety excellence never ends, and understood and was difficult to we are constantly evaluating ap- track on a global level. For these Promoting a Health and proaches to improve our programs Safety Progress and reasons, we shifted to the more Safety Culture and to integrate injury prevention meaningful measure of percent To achieve our goals, Lilly works into everyday work. Performance collisions, which simply demon- In 2013, we established new hard to integrate our safety sys- strates the percent of our fleet Our employees face potential interim goals for the three occu- tems and culture into all areas risk of injury in their work envi- pational safety metrics we track: of our business. In 2015, we ronment—be it in motor vehicles, 4 Lilly uses definitions for these terms as integrated our health and safety recordable injuries, lost time in- defined by the U.S. Occupational Safety and research labs, manufacturing, juries, and motor vehicle collision Health Administration Part 1904, Recording systems and approach into newly and Reporting Occupational Injuries and Illness. acquired sites, placed increased
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 100 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
focus on integrating ergonomics are significantly enhanced by our evaluations. Lilly has placed a TOTAL RECORDABLE INJURY RATE into our research laboratories, employees’ willingness to be part significant emphasis on serious heightened emphasis on em- of the solution. Employees in all injury and fatality (SIF) prevention 1.44 0.90 ployee safety in office areas, and areas and functions within the since 2012, and the effort has been 0.87 0.70 increased our use of behavioral company, including laboratory, successful. We ask employees 2007 2014 2015 2020 Goal safety tools to help record and manufacturing, office, and sales to report “near misses”—events monitor employee observations positions, have the opportunity that could have—but thankfully did LOST-TIME INJURY RATE around safety. to participate in ergonomic as- not—result in an injury. We use sessments and get assistance in this data to take action and im- Across Lilly as a whole, we be- 0.60 identifying unsafe behaviors and prove our performance. For exam- 0.36 0.26 0.25 lieve that achieving and sustaining conditions. In 2015 alone, Lilly ple, near-miss reporting caused world-class safety performance 2007 2014 2015 2020 Goal employees participated in nearly us to put additional emphasis on requires commitment in three key 8,400 ergonomic assessments, disconnection of power sources * categories: leadership, employee MOTOR VEHICLE COLLISION RATE including manufacturing areas, during equipment maintenance. In participation, and flawless execu- laboratories, office workspaces, 2015, our operational sites part- 25% tion of programs. Here are some 18% and sales vehicles. nered with subject matter experts 16% 12% highlights of our safety programs to conduct on-site assessments, across these three areas: All employees are encouraged to 2007 2014 2015 2020 Goal in an effort to standardize best speak up when they see potentially Leadership. Effective senior lead- practices for energy control during * See earlier discussion of motor vehicle unsafe conditions. In 2015, we ex- ers model safe behaviors at work. servicing and maintenance. collisions for a description of our new system panded our use of BSafe, a global for measuring and recording this metric. When it comes to displaying safe system for recording, reporting, behaviors, no action is too small— and analyzing safety observations. using the handrail while on the Health and Safety Performance The data collected is now being ergonomics has caused us to rede- stairs, avoiding distractions while In 2015, recordable injuries and used to help us predict and elim- fine our internal processes around driving, and adjusting office work- illnesses caused by ergonomic inate precursors to potentially prevention, early intervention, spaces to promote healthy, neutral hazards—musculoskeletal prob- serious injuries and fatalities. and case management. postures during desk work. Senior lems caused by desk and work leaders set high expectations for Flawless Execution of Programs. site configurations that are not Injuries and illnesses caused by their teams around safety and At Lilly, we are constantly evaluat- optimized for the user—increased other major accident categories encourage the use of preventive ing the effectiveness of our safety approximately 24 percent over all improved when compared with safety tools that help eliminate our programs, with an ultimate goal 2014 and accounted for 47 per- our 2014 performance. In partic- most common injuries. of flawless execution. This is done cent of all recordable injuries ular, our focus on motor vehicle through corporate auditing, local and illnesses. This increase in safety has resulted in a 37 percent Employee Participation. Lilly’s self-assessment, and targeted injuries and illnesses related to improvement since 2009. safety culture and performance
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Overall, as of year-end 2014 compared to • Improving energy conservation year-end 2015, we are pleased with the prog- through eco-driving behaviors. ress in the number of total lost time injuries, Our hseDIRECTIONS investment which decreased by nearly 30 percent, and 11% 12% has resulted in a decrease in mo- the corresponding number of lost work days caused by lost time injuries, which de- tor vehicle collisions, and, con- creased by almost 45 percent. These are two sequently, a significant reduction 18% Total Recordable important indicators that show the severity in motor vehicle-related injuries. of injuries that occurred at Lilly in 2015 was The program places emphasis Injuries by Accident greatly reduced compared to 2014. on behind-the-wheel, defensive Category 2015 driving techniques. In 2015, trag- ically, one of our employees was 12% 47% At Lilly, sales and marketing killed in a motor vehicle accident. employees represent about 30 Our employee was a passenger percent of our global workforce. on a bus that struck another truck Their jobs require them to spend while in transit in Bangladesh. For large amounts of time driving. more than two years, no employee * ** Struck by / Against / Caught between Ergonomic Risk Motor Vehicle Collisions Motor vehicle accidents pose risks has been involved in a fatal acci- Slip / Trip / Fall Other that are often out of our employees’ dent while driving. control. In 2010, we launched a Following an analysis of motor ve- motor vehicle safety program, 6% hicle collisions and related injuries called hseDIRECTIONS, designed 20% between 2008 and 2013, we added specifically for the thousands of requirements for all of our new Lilly employees who are on the fleet vehicles in the United States road every day, visiting physi- and Europe to be equipped with Lost-Time Injuries cians, hospitals, clinics, and other 36% collision-avoidance technologies. by Accident customers. 16% We expect these technologies to Category 2015 The program focuses on four result in a significant reduction key areas: in rear-end collisions—the most common type of accident leading • Motor vehicle safety, collision, to employee injuries. 22% and injury prevention; • Ergonomic risk reduction; We have also focused our fleet safety program on ergonomic * Refers to non-motor vehicle injuries resulting in result in abrasion, contusion, and laceration • Personal safety and security; and ** Refers to ergonomic risks (posture and/or force, repetition, duration of tasks) which training, for example, aligning the increase the likelihood of a sprain or strain
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 102 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
car seat correctly and reducing the The mission of the wellness and amount of time spent in the same productivity team mirrors the Lilly position while driving. We added Promise—uniting caring with dis- new makes and models of vehi- covery to make life better, including cles to our fleet choices to provide for our own employees and their greater varieties of seating options families. When people hear the and ergonomically-friendly tech- term “wellness,” they often think nologies, such as hands-free trunk about the physical aspects of health lifting that reduces the risk of back and fitness. To fulfill our promise to injuries while inserting heavy con- employees, we have a broadened tainers into vehicles. view of wellness designed to create a culture of well-being across five Energy conservation is another dimensions: physical, financial, area where we can have an im- social, community, and sense of pact. We encourage eco-driving purpose. Our Fit for Life benefit services (such as annual physicals who commute to work by bicycle. behaviors and have expanded the program offers a set of tools and and cancer screenings) that go We have also made all U.S. sites choices of fleet vehicles with lower resources to help employees not well beyond the requirements es- smoke-free. emissions. To learn more about tablished under federal healthcare only better manage their health but Other U.S. efforts to support our the environmental performance of reform. Outside the United States, also to identify those things that employees’ physical and emotional Lilly’s fleet, see the Environmental we deliver competitive benefit can contribute to a healthier and health include access to a dietitian, Stewardship section of this report. packages and health coverage that more active life. Fit for Life ben- quarterly fitness challenges, sup- varies depending upon location. efit offerings include free annual port for new mothers, and a com- In many countries, our employ- preventive health screenings, prehensive employee-assistance Supporting Employee Wellness ees receive government-provided well-being assessments and plans, program, including consultation medical benefits. at Lilly fitness trackers, health and clinical with on-site psychologists. We Our company’s wellness and pro- coaching, tobacco cessation, weight At our Indianapolis headquarters, also promote financial well-being ductivity team has direct responsi- management, and access to a net- we have several on-site fitness through a variety of online financial bility for our U.S. wellness strat- work of nearly 9,000 fitness centers centers for individual and group tools and financial advisory pro- egy, work-life balance programs, nationwide. fitness activities. We partner with grams. Many of the benefit offer- and employee activities around our food service vendors to provide ings also are available to spouses, healthy living, as well as medical In the United States, Lilly offers a wide range of healthier dining domestic partners, and qualified and disability leaves. There are health plan coverage to employees choices and snacks—some of dependents to promote well-being similar teams at several of our and their eligible dependents. Lilly which are subsidized. We provide for the entire family, not just the international affiliates. also provides U.S. employees with coverage for preventive health showers and bike racks for more person directly employed by Lilly. than 150 Indianapolis employees
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 103 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
This section covers the broad LILLY'S 2020 ENVIRONMENTAL GOALS* Environmental range of our environmental ac- tivities, from our approach and To motivate Lilly to continually decrease our environmental impacts, we drive progress toward management systems, to our work our 2020 goals. The baseline for our goals is 2012, with the exception of our phosphorus emis- Stewardship addressing environmental issues sions reduction goal, which has a 2014 baseline. across our value chain, to perfor- Reduction in greenhouse gas emissions intensity**,*** mance data and examples demon- 20% Progress through 2015: 4% reduction Making medicines that help people strating progress. ** live longer, healthier, more active 20% Improvement in energy efficiency lives requires the use of valuable Progress through 2015: 1% improvement resources, such as energy, water, Our Commitment Reduction of phosphorus emissions in wastewater (with a baseline of 2014)**** and raw materials. We take a 15% Progress through 2015: 5% increase broad approach to understanding and Approach and managing our environmental Improvement in waste efficiency† while increasing recycling rate above 70% and impacts across the product life A Lifecycle Focus 20% decreasing waste to landfill below 10% of total waste cycle, and we look for opportuni- Each stage of the pharmaceutical Progress through 2015: 56% decrease in efficiency ties to improve our performance. product life cycle includes distinct * Following World Resources Institute guidance, progress toward environmental goals is reported on We’re committed to conducting an adjusted basis accounting for mergers, acquisitions, and divestitures, as appropriate, to ensure environmental, health, and safety comparability, unless stated otherwise. our business in a patient-centered impacts and opportunities for ** Per square foot of site space. manner and to continually reducing *** This goal covers Lilly’s Scope 1 and Scope 2 emissions related to site-purchased energy (e.g., improvement. The graphic on the electricity, steam, chilled water) and on-site fuel combustion. our environmental footprint. next page provides an overview of **** In absolute terms. † Per unit of production or site-relevant index. Lilly’s waste goals do not include materials that our work to reduce the potential are deemed “reused” without extensive processing. Examples include coal ash reused for mine impacts from our operations. reclamation or road base, and mycelia and urea reused for fertilizer.
SCOPE OF HEALTH, SAFETY, AND ENVIRONMENT DATA IN THIS SECTION
• Data in this section cover Lilly’s global operations, including wholly-owned subsidiaries, • Bureau Veritas provided independent, third-party verification of GHG unless stated otherwise. emissions data for Scopes 1, 2, and 3 included in the Environmental • Data may be revised compared to prior reports due to changes in calculation methodology Performance Indicators section of this report on page 120. In addition, and other factors. Bureau Veritas verified the percentage decrease from 2012 (when that is the goal baseline year) and from 2014 (in all cases) compared to 2015 • Following World Resources Institute guidance, energy use, greenhouse gas (GHG) emissions for the following metrics: energy efficiency, waste to landfill, waste (except Scope 3), and water-use data are reported on an adjusted basis accounting for mergers, efficiency, recycling rate, water intake, and phosphorus discharge. acquisitions, and divestitures, as appropriate, to ensure comparability, unless stated otherwise. • Years are calendar years, unless stated otherwise.
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MANAGING ENVIRONMENTAL PERFORMANCE ACROSS THE PRODUCT LIFE CYCLE
Materials, water, and energy, HSE management system and standards
Research and Development Materials and Natural Resources Manufacturing We consider environmental factors from Our stakeholders, including customers, Our Elanco and Pharmaceutical manu- the earliest stages of design and develop- governments, and suppliers worldwide, facturing health, safety, and environment ment. We use the 12 principles of green are increasingly focused on the materials (HSE) committees oversee sustainability chemistry, environmental risk assess- and chemicals used to make products. performance and compliance with applica- ments, packaging manufacturing reviews, We have a chemical management pro- ble HSE regulations, policies, procedures, and an Environmental Development gram and work to reduce our use of and standards while ensuring we contin- Review process to evaluate potential envi- materials, water, and other natural ually measure, report, and reduce Lilly’s ronmental impacts during the scale-up of resources when possible. environmental impacts associated with human health pharmaceutical production For more information, see page 110. our own as well as contract manufacturing to manufacturing levels. organizations. For more information, see page 108. For more information, see page 113.
Sales and Marketing Product Transport and Packaging Product Use Product End of Life At many Lilly sales and marketing offices Lilly tracks the GHG emissions of our prod- Lilly is committed to understanding the Due to patient safety considerations and worldwide, we manage projects to im- uct transportation and distribution ven- potential effects of pharmaceutical prod- medicine regulations, reuse and recycling prove environmental performance while dors, and we collaborate to reduce those ucts in the environment. We support using are not applicable to our products. We increasing employee awareness and impacts while ensuring product integrity. science-based evaluations to assess and are working with stakeholders to ensure action. Lilly continually works to improve We consider many factors in selecting reduce the environmental risks of our cost-effective approaches are available for the fuel efficiency of our sales force fleet product packaging, including sustainability pharmaceutical products. Through collab- product end-of-life disposal that balance through vehicle choice and optimization of dimensions such as materials use and re- orations with industry partners, academic environmental protection, patient privacy, driving and work practices. These efforts cyclability. We require packaging vendors researchers, and regulatory agencies, we legal compliance, and security. also reduce associated greenhouse gas in China, Europe, and the United States to continually work to further understand and For more information, see page 112. (GHG) emissions. certify that they source all paper and card- proactively address any potential impacts For more information, see page 114. board used to package our products from from our products. sustainable forests. For more information, see page 110. For more information, see page 110.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 105 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
How We Manage requirements to ensure compli- Our Global HSE Committee— administrative functions, manage ance with Lilly health, safety, and which includes senior executives governance for HSE in those areas. Environmental Issues environment (HSE) standards; from key areas of the business— Management Systems Policies and Standards applicable regulatory require- ensures proper oversight and plays Lilly sites and business areas have Several policies and standards ments; and other external HSE a central role in monitoring corpo- HSE management systems aligned define our commitments and guide standards to which we subscribe. rate performance and continuous with our Management System our efforts: improvement. The vice president • Our Global Engineering Stan- Standard, which is consistent responsible for global HSE works • Our Protecting People, the Envi- dards govern many environmen- with third-party standards such closely with the Global HSE Com- ronment, and Our Assets Policy tal aspects of our operations, as International Organization for mittee to approve appropriate met- sets environmental expecta- such as energy use and green- Standardization (ISO) 14001, Occu- rics and goals, assess company tions related to compliance and house (GHG) emissions. pational Health and Safety Assess- performance, and oversee com- environmental protection for our ment Series (OHSAS) 18001, and • Our Product Stewardship Stan- pliance with all HSE regulations, people and operations. the American Chemistry Council’s dard provides a systematic way policies, procedures, and stan- • Our Environmental Standard Responsible Care Management to manage product and process dards globally. The manufacturing provides more detailed require- System (RCMS®). Our global HSE risks throughout the product life HSE committees support these ments and establishes the core management system is also cer- cycle, from discovery to product efforts and drive ongoing improve- governance requirements to man- tified to RCMS, and almost half of end of life. ment throughout manufacturing. age environmental and energy- our manufacturing locations are HSE Governance Executives and lead teams in each related aspects of our operations. certified to one or more external Lilly’s formal HSE governance of our business groups and manu- standards including ISO 14001, • Our Management System Stan- structure (see graphic) integrates facturing, as well as Lilly Research OHSAS 18001, Voluntary Protection dard and Verification and Cor- HSE management companywide. Laboratories and general and rective Action Standard define Programs, and RCMS.
LILLY HEALTH, SAFETY, AND ENVIRONMENT GOVERNANCE STRUCTURE LILLY’S POLICY ON PROTECTING PEOPLE, THE ENVIRONMENT, AND OUR ASSETS
* Our Elanco and pharmaceutical We strive to maintain a secure workplace and to protect people and the communities in which BOARD OF DIRECTORS operations have separate but we operate and serve. We are focused on continuously improving our health and safety practices aligned HSE governance struc- to promote the well-being of our people. We are committed to conducting business in a respon- tures for manufacturing, research EXECUTIVE COMMITTEE and development, and general sible and environmentally sustainable manner. We are committed to a robust security culture to and administrative functions. The protect our people and brand from harm, and our assets from loss, theft, or damage. Each of us is GLOBAL HSE COMMITTEE Elanco and pharmaceutical gov- responsible for implementing our security practices and applying them in our daily activities. ernance structures share com- mon Lilly policies, standards, and ELANCO* PHARMACEUTICALS* assurance systems and establish their own as appropriate.
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Audits billion British thermal units (BTU) Sustainable Culture at Lilly Each year, we audit approximately of energy, avoid about 107,000 Our employees play a key role in Product Stewardship 30 percent of our sites globally, metric tonnes carbon dioxide the ongoing success of our en- Lilly takes a broad approach to un- equivalent (CO e) of GHG emis- following the protocols outlined for 2 vironmental efforts. Hundreds derstanding and managing possible each of our Global HSE Standards. sions, and save almost $20 million. of employees, passionate about HSE issues across the product life Our five-year audit plan, updated In 2015, funded projects included sustainability, make up dozens of cycle (see page 105). This im- annually, determines which sites the following: “green teams” globally. With the proves our own performance and to audit based on risk. External support of HSE representatives • Installation of energy monitoring demonstrates our values, while and internal auditors participate in and management, these teams equipment and LED lighting in also meeting the increasing ex- each audit conducted. work to reduce environmental Kinsale, Ireland; pectations of customers and other impacts at Lilly sites and in their Energy, Waste, Water, stakeholders. • LED lighting installation in communities. The green teams and Natural Resource Use Carolina, Puerto Rico; also engage internal and exter- Lilly’s Product Stewardship Stan- Reduction Fund nal experts to provide insight and dard defines the requirements for To facilitate capital investments in • Expansion of an existing heat inspire action through presenta- addressing HSE throughout our technology and physical plant op- pump system in Fegersheim, tions and educational materials value chain and integrates our ap- erations that improve environmen- France; on environmental issues. These proach throughout Lilly’s business tal performance, we established • Solar photovoltaic array teams implement projects such as (page 108). Numerous Lilly busi- and manage an Energy, Waste, installation in Erl Wood, United employee carpooling programs, ness areas and functional groups Water, and Natural Resource Use Kingdom; energy-efficiency initiatives, and contribute to implementing this Reduction Fund. The fund helps • Laboratory hood personnel de- beverage container and cardboard standard across our value chain. pay for capital projects each year tection and variable exhaust flow recycling. The green teams present The scope covers both internal at our facilities globally and pro- technology to safely reduce labo- ideas for management approval. and external value chain elements motes the development of environ- ratory air flow and save energy in Projects must be cost-effective and globally. mentally superior, efficient tech- Erl Wood, United Kingdom; and have clear environmental benefits. nologies and best-practice sharing We focus on the following areas: • Purchase of precise dispensing across our facilities. We also encourage employees to • Using green chemistry and technology in research labora- act as better environmental stew- Since 2006, we have approved a engineering to reduce the use tories in Indianapolis, Indiana, ards outside of work and provide total of more than $37.5 million for of energy, water, and hazardous to reduce waste generation by them with information and re- investment in over 140 projects. materials in our development approximately 4.5 metric tonnes sources on topics such as increas- This is in addition to the amounts and manufacturing processes; per year. ing composting and recycling in spent by those facilities indepen- their homes, upgrading to more • Reviewing materials used in drug dent of the global fund. On an efficient lighting, and using public delivery devices, such as insulin annual basis, these projects transportation when feasible. injection pens, to reduce their collectively save more than 865 environmental footprint;
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 107 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
• Developing more sustainable Our product development objec- LILLY'S PRODUCT STEWARDSHIP STANDARD packaging materials and practices; tives for our human health prod- • Using science-based environ- ucts include the use of green Reflecting the breadth of product-related sustainability issues, our Product Stewardship Standard mental risk assessments to eval- chemistry, along with criteria such covers the following areas: as quality and cost. Development uate the potential impact of our • Emerging issues: Identifying, analyzing, and managing new and emerging issues; teams are accountable for pro- products on the environment; and • Procurement: Considering environmental factors in purchasing decisions; cess efficiency and safety from • Supporting responsible product when they select candidate mole- • Product discovery: Reviewing internal and external research operations to foster high HSE disposal at end of life. cules through the development of standards; a manufacturing process, and we • Product development: Using inherently safer design principles, such as green chemistry, as well monitor progress at major mile- as engineering innovations, to identify and reduce HSE hazards from new production processes Design for Environment where possible; stones. We outsource a significant The majority of the environmental amount of product development, • Product packaging: Reducing the amount of packaging and using environmentally preferable impacts of pharmaceutical prod- so we share guidelines with our materials, when possible, while satisfying regulatory and customer requirements, meeting uct manufacturing are determined marketing objectives, and preserving product integrity; partners to ensure consistent ob- during the research and develop- jectives, processes, and outcomes. • Distribution: Ensuring safe product transport and warehousing while reducing associated envi- ment stage of our value chain, so ronmental impacts; at that point we consider the mate- Lilly’s approach to green • Marketing and sales: Working with customers to enhance the patient experience related to rials and processes we will use to chemistry in our human health product environmental performance; make products and their packag- pharmaceuticals is twofold: • Suppliers, contract operations, and alliances: Evaluating and influencing the HSE performance ing and work to identify opportuni- of suppliers, contract operations, and alliances (see page 82 for more information about • We seek improvements by re- ties to improve their environmental supplier management); and performance. ducing the amount of hazardous material used to make a prod- • Supply chain management: Establishing plans to ensure business continuity and appropriate emergency response, if needed. uct, increasing overall material Innovations in Green Chemistry efficiency, evaluating chemical alternatives, and avoiding use of Green chemistry works to reduce To support these efforts, we have the process we use to develop and the most hazardous substances. or avoid hazardous materials use, established guidelines for the type assess the suitability of new man- decreasing or eliminating the need • We strive to advance the under- and quantity of materials needed ufacturing processes. We evaluate for related protection, controls, and lying chemistry and engineering to synthesize new products. These success in implementing these treatment. Lilly has many years of technologies used to make med- also restrict the use of materials standards and share feedback with experience with green chemistry icines through innovation, both that could significantly increase development teams (see Environ- initiatives that engage both internal internally and through external process environmental and safety mental Development Review on and external stakeholders. partnerships. risks. These guidelines, along with page 109). other design criteria, are a part of
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 108 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
We have developed several inno- 4 million kilowatt hours (kWh), and approach uses environmentally Environmental vative approaches that improve generation of a hazardous waste friendly solvents and is considered environmental performance and stream by 25,000 liters. The removal nearly carbon neutral, resulting in Development Review enhance process safety by reduc- of unneeded equipment also gen- a decrease of solvent-related GHG Lilly uses an Environmental De- ing the scale of the most hazard- erated 27 metric tonnes of scrap emissions from the process by 69 velopment Review (EDR) process ous manufacturing steps by more metal for recycling. In addition, as percent. Learn more. in our human health pharmaceu- than one hundredfold. We measure these changes are implemented, tical business to evaluate potential Lilly has been a leader in the progress in green chemistry at we will eliminate the road and rail environmental issues and oppor- American Chemical Society’s (ACS) critical steps in the human health transportation needed to deliver tunities during the scale-up of Green Chemistry Institute (GCI) product development process with the hazardous materials to the site, medicine production to manufac- Pharmaceutical Roundtable since material use efficiency metrics further improving our risk profile. turing levels. This process helps it co-founded the Roundtable in including process mass intensity us identify and address potential Lilly also focuses on the use of 2004. In 2015, we contributed to (PMI), a ratio of the total mass of impacts of manufacturing and greener and safer solvents. We the rollout of reagent guides and raw materials (including water) waste treatment, suggest process have replaced several hazardous tools to encourage scientists to used for every kilogram of drug improvements, and share learning solvents with safer alternatives choose more environmentally produced. We set PMI targets as new medicines transition into over the years, and, in 2014, we friendly reaction conditions and based on molecular complexity and manufacturing. Find more infor- completed a Six Sigma project fo- supported development of an predicted product demand, helping mation about our environmental cused on replacing several addi- informational video (see below) us to identify the highest return performance in manufacturing on tional solvents. Following this initia- about green chemistry in the opportunities for waste reduction. page 113. tive, we issued new internal solvent pharmaceutical industry. We also In 2015, we improved the process selection and solvent replacement supported the continued funding to manufacture an active pharma- guides. The latter includes case of external research grants—the Global Chemical Management ceutical ingredient at our Indianap- studies on successful replacement three grants issued in 2015 totaled Governments around the world olis facilities. The primary purpose of solvents to meet requirements approximately $2 million. and across many of the regions of the project was elimination of of the European Union’s Registra- where we operate have developed hazardous chemicals, but other tion, Evaluation, Authorisation and chemical management legislation, significant environmental improve- Restriction of Chemicals (REACH) such as the European Union (EU) ments were made in alignment regulations. We have also made REACH regulation, which re- with our sustainability goals. As significant efforts to limit the use of quires some companies to collect a result of the process improve- dichloromethane (a hazardous air and register information about ments, we project we will annually pollutant), including the develop- the chemicals they manufacture reduce air emissions by 60 percent, ment of an amino acid-based pro- VIDEO ACS GCI Pharmaceutical Roundtable or use. These regulations may wastewater generation by 10 mil- cess to produce a key pharmaceu- Celebrates 10 Years also require replacing the most lion liters, energy consumption by tical intermediate. The innovative hazardous chemicals with safer
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 109 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact alternatives, when available. We is also a source of cost and waste. Pharmaceuticals in products or through pharmaceutical continue to assess the impact of Through our sustainable packag- manufacturing discharges. these regulations on substances ing efforts, we continually seek the Environment Advanced analytical testing tech- we manufacture and on our raw to improve packaging design to Pharmaceuticals are designed to nologies enable scientists to mea- materials use. We are commit- reduce the amount of packaging cure or treat disease and to help sure trace residues of pharmaceu- ted to ensuring our facilities and used; use lower environmental people live healthier lives. How- tical products in the environment supply chain remain in compliance impact materials, such as recycled ever, like many foods and nutri- that were previously undetectable. with chemical management laws. content; enhance recyclability; tional supplements, they are not These residues are widespread and reuse or recycle packaging always completely absorbed or and have been found in streams, throughout the supply chain. broken down by the body. Residues Materials Use of a pharmaceutical or its by- rivers, and other water bodies. Our Product Stewardship Standard products may be excreted as part Reported concentrations are ex- Lilly assembles injection devices helps set expectations for these ef- of normal biological processes. tremely low—in some cases, less that patients use to administer forts. We established requirements Sewage treatment systems are than one part per trillion (equiv- some of our medicines—products for packaging suppliers in China, not always able to completely re- alent to about one grain of sugar that demand the highest standards Europe, and the United States to move these substances, and these dissolved in an Olympic-sized of quality, sterility, and reliability provide certification that their pa- residues may pass through treat- swimming pool). Despite these to ensure patient safety. Meeting per stock is sourced from sustain- ment facilities and enter rivers, very low concentrations, the these high standards is our top able forests. Acceptable certifica- streams, or lakes. To a lesser presence and biological potency priority. Although our environmen- tions include those provided by the extent, pharmaceutical products of pharmaceuticals raise ques- tal design and materials selection Forest Stewardship Council (FSC) may also enter the environment tions about how to best evaluate efforts extend to this area, we use for folding cartons, leaflets, labels, from improper disposal of unused potential associated human and only virgin raw materials in man- and combination products, and the ufacturing to meet the standards Sustainable Forestry Initiative (SFI) for these devices and minimize the for fiber sourcing, chain of custody, possibility of any impurities. and product labels. In 2015, we developed a new pack- Packaging aging metrics dashboard to collect Pharmaceutical packaging is data on packaging materials and highly regulated and must fulfill quantities. Beginning in 2016, these many functions, including ensuring metrics will help us identify im- product integrity during transit provement opportunities—for exam- and storage, providing information, ple, through comparisons between resisting counterfeiting, and pro- product categories and business tecting contents from tampering units—and document progress. Waterfowl enjoy the wetlands area at our Clinton, Indiana, site, which is open to the public. or access by children. Packaging
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 110 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
environmental risks. Published attention and resources of water and recommend resources for (EPA) and EU Water Framework studies to date, including the often suppliers and regulators from related internal and external ini- Directive methodologies). In addi- cited World Health Organization’s other water quality priorities. tiatives. Our manufacturing gov- tion, we have processes in place (WHO’s) 2011 Technical Report on ernance committees also review to ensure that our manufacturing Governance Pharmaceuticals in Drinking Water, internal and external PIE issues, discharges do not create condi- Due to the importance of this issue indicate these trace amounts of as those groups have ultimate tions that could promote strains to Lilly, the environment, and our pharmaceuticals are unlikely to accountability for environmental of bacteria resistant to antibiotics, stakeholders, we have established impact human health at the levels issues in operations. which might present risks to peo- a Governance Committee for Phar- detected. WHO has cautioned ple and wildlife. maceuticals in the Environment Operations interested parties to not let con- to set strategic direction, support We test and assess our medicines To study the overall impact of our cerns over pharmaceuticals in effective internal collaborations, for potential impacts on the envi- operations on local habitats, our the environment (PIE) divert the ronment to ensure that we meet site in Kinsale, Ireland, has been regulatory requirements and engaged in a continuous evalu- internal standards before intro- ation of aquatic habitat quality IMPROVED METHODOLOGIES FOR ASSESSING ENVIRONMENTAL RISKS ducing our products to markets. since 1978. Update reports are We regularly update our testing regularly issued and results show The goals of the Intelligence-led Assessment of Pharmaceuticals in the Environment project protocols for new and existing no evidence of an adverse impact (iPiE project)—a collaboration among Lilly and other pharmaceutical companies, universities, pharmaceuticals as knowledge and of the Lilly wastewater discharge research organizations, public bodies, and nonprofit groups—are to develop frameworks to support the environmental testing of new pharmaceuticals and to help prioritize testing of testing methods improve. We make point on any aspect of habitat active pharmaceutical ingredients (APIs) approved for use prior to 2006 and still marketed. The information on the environmental quality in the study area. This long frameworks will draw on information such as existing data on the environmental impact of APIs, hazards and impacts of our phar- term effort has supported studies toxicological studies, computer models, and studies of how medicines work. maceutical products readily avail- published in peer-reviewed sci- able through safety data sheets. entific publications and continues Project focus areas include the following: to support academic research for Lilly is committed to using • Identifying existing methods for conducting pharmaceutical environmental risk assessments; undergraduates. science-based approaches for • Compiling a database with information on both APIs and test organisms; identifying and minimizing any External Collaboration • Developing new models for estimating exposure to APIs that will consider factors such as how significant risks from residues of We continue to partner with indus- much of an ingredient is released into the environment, how fast it is broken down, and how our products in the environment. try, academia, and governments to extensively it accumulates; and We create predicted no-effect improve both our understanding • Devising methods to predict the effects of APIs on different organisms in terrestrial and aquatic concentration (PNEC) values for of, and our response to, PIE. environments. our medicines through recognized Beginning in 2015, Lilly has sup- These activities will inform the development of an exposure assessment tool that can be used scientific processes (primarily U.S. ported collaborative research on to screen APIs under development and prioritize existing APIs for enhanced testing. All models Environmental Protection Agency PIE with the Innovative Medicines developed by the project will be validated experimentally.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 111 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
better understand and ensure an We also engage with other indus- effective approach to product end- try stakeholders in the European of-life issues. Union (EFPIA), Canada (HPSA), and other countries. We promote science-based policy decisions regarding the disposal of In the U.S., Lilly believes that unused medicines, and we support recommendations to dispose of educating patients and caregivers most unused medicines in house- on proper disposal. See Lilly’s hold trash are well-supported by Position on the Disposal of Unused current and ongoing research as Medicines in the United States. We environmentally safe, effective, also support the proper disposal and easy for consumers to under- of syringes, needles, and other stand. When in-home disposal is sharps used in home settings to not preferred, we support voluntary A crab in Kinsale Harbor, Ireland, where our site has engaged in an ongoing evaluation of aquatic habitat quality for mitigate potential public health industrywide, cost-effective disposal nearly 40 years. and safety risks. Based on feed- solutions for unused medicines that back from patients and healthcare are safe and easy for patients; Initiative (IMI), jointly undertaken by pharmaceutical residues in water providers, we believe that educa- prevent misuse of prescription the European Union, various uni- with the U.S. National Academies tion offers the greatest opportunity drugs; and ensure environmental versities, and the European Feder- National Research Council, the to improve disposal practices for protection. For example, in 2015, ation of Pharmaceutical Industries EPA, and the Society of Environ- sharps. We are working to more Lilly provided a grant to Yellow and Associations. Using input from mental Toxicology and Chemistry. effectively communicate this infor- Jug Old Drugs, a program under industrial and academic experts, mation to patients through product the Great Lakes Clean Water/U.S. participants in the IMI project are user manuals, patient education Clean Water organization that developing a predictive frame- Product End of Life programs, improved sales force provides prescription drug disposal work to identify potential risks in Medicines are intended to be used awareness, and updated informa- services to pharmacies, enabling this area. We plan to support this in their entirety by patients. Even tion at The Lilly Answers Center. the public to turn in unused initiative through 2018. when this does not occur, regula- medications for safe disposal and We are actively involved in the tions prohibit the use of recovered avert potential misuse. This con- Our scientists and engineers have Pharmaceutical Product Steward- materials in our products. As a re- tribution will increase from 29 to published articles and presented ship Work Group, a U.S. member- sult, ecologically beneficial models 100 the number of prescription at conferences and workshops. ship association of manufacturers of consumer take-back, reuse, and drug collection and disposal sites They have also provided peer- of prescription and over-the- recycling programs do not apply to delivered through the program review services for scientific counter medicines formed to sup- our products. We continue to work across Indiana. See a map of journals and have participated port compliance with U.S. house- with customers and partners to participating locations. in meetings about the safety of hold disposal regulations.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 112 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
PROGRESS TOWARD GOAL—GREENHOUSE GAS EMISSIONS Environmental Improving site energy efficiency by Performance Scope 1 2 90 20% and reducing greenhouse gas Scope 2 80 emissions intensity by the same We are committed to continually 0.486 0.436 0.460 0.472 * GHG emissions 70 amount by 2020 will cumulatively:
improving environmental perfor- e 1.5 intensity 2 58.3 57.7 mance across Lilly’s operations. 57.1 55.1 60 We prioritize our most significant 50 1.12 1.11 areas of environmental impact— 1 feet e/1,000 square
1.08 1.07 2 energy use, GHG emissions, water, 2020 Goal 40 and waste. In addition, we are ded- 30 Decrease CO2e, the icated to maintaining compliance CO Million Metric Tonnes .5 equivalent of planting with applicable legal standards, 20 Metric Tonnes CO Metric Tonnes ** advancing green procurement, 10 20 million trees reducing non-GHG air emissions, 0 0 and supporting biodiversity. Fun- 2012 2013 2014 2015 damental to our approach, we establish, work toward, and share cost for our research, manufactur- We achieved this result even though progress against HSE perfor- ing, and distribution activities (see production increases at some of mance goals (see page 104). page 114). Recognizing the inter- our larger manufacturing sites Save more than connections between GHG emis- raised energy usage (see page 114 $160 million** Greenhouse Gas Emissions sions and water use, we have also for more detail). GHG emissions evaluated water-stressed areas will remain a key focus for the com- Climate change is compelling gov- where we operate (see page 116). pany, and we are further expanding ernments, companies, and citizens efforts to reduce energy use as worldwide to act, as demonstrated Lilly’s 2020 goal is to reduce needed to meet our goal. in December 2015 at COP21, the Scope 1 and Scope 2 GHG emis- global climate conference in Paris, sions related to site-purchased This year, we again reported France. At Lilly, we set and drive energy (e.g., electricity, steam, several categories of Scope 3 Avoid the use of progress toward aggressive targets chilled water) and on-site fuel GHG emissions, as included in energy equaling about for improved energy efficiency and combustion by 20 percent per the Environmental Performance ** reduced GHG emissions. This im- square foot of site space, com- Indicators table on page 120. We 78 million proves our environmental perfor- pared to our 2012 baseline. In are committed to continually ex- gallons of gasoline mance and decreases energy use, 2015, we decreased emissions panding the scope and quality of * Compared to 2012. which is a substantial operational intensity by 4 percent since 2012. our disclosure in this area and are ** Source: EPA.gov.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 113 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact evolving our strategy for gathering performance based on our five- Energy Use using photovoltaic (PV) arrays. A environmental footprint data from tier system (Beginner, Follower, Energy assessments, used to iden- 9.95-megawatt (MW) PV solar sys- our suppliers. Good Citizen, Leader, and Best in tify and help prioritize energy con- tem, completed in 2014, adjacent Class), about 40 percent achieved to our subsidiary in Branchburg, In 2015, Lilly achieved a CDP (for- servation measures, are central to “Leader” or “Best in Class." New Jersey, covers more than merly Carbon Disclosure Project) our approach. Since 2006, we have 40 acres and is one of the big- climate change disclosure score of During 2015, we achieved a 25 conducted assessments at 10 of gest of its kind for an East Coast 89, compared to the average score percent reduction in fleet GHG our most energy-intensive sites. non-utility company. The sys- of 82 in the healthcare sector and emissions at our four largest In 2015, assessments were con- tem generated 13.2 million kWh our company’s score of 85 in 2014. European affiliates (Germany, Italy, ducted at Lilly sites in Fegersheim, of electrical energy in 2015 and Our performance band was C. See Spain, and the United Kingdom) France; Kinsale, Ireland; Carolina, provided 31 percent of the power Lilly’s recent CDP climate change through vehicle replacements, Puerto Rico; Branchburg, New submission for additional detail while Lilly Japan replaced more Jersey; and Clinton, Indiana. about the company’s approach and than half of its 2,000-vehicle fleet Additionally, Lilly has implemented ENERGY PROGRAM performance in this area, including with fuel-efficient hybrid vehicles. several global strategic initiatives climate change-related risks and During 2016, we will finish up- to support these efforts, such as We are committed to using energy in an opportunities. grading the fleets in an additional energy sub-metering to enable efficient, cost-effective, and environmentally 10 European affiliates (Austria, responsible manner. To do so, we establish Decreasing Environmental monitoring and benchmarking of Czech Republic, Denmark, energy-efficiency goals and implement energy Impacts in Sales and Marketing facilities and utility equipment, use Finland, Hungary, Norway, Poland, management practices globally. Our approach All Lilly commercial sales affiliates of the Laboratory Energy Efficiency Romania, Slovakia, and Sweden). includes the following elements: around the world are required to Profiler assessment tool, and Lilly now centrally manages vehi- 5 develop goals and implement im- retrocommissioning of laboratory • Design for energy efficiency in new or cle selection across the European updated processes and facilities; provement strategies as part of our and administrative facilities. Union, which improves efficiency Green Directions Program, which • Operate our facilities and equipment while enabling us to implement We continue to use renewable en- focuses on fleet fuel economy/ efficiently; strong safety and environmental ergy to diversify our energy sources GHG emissions, office energy • Monitor and report energy consumption standards. and decrease GHG emissions, and resulting GHG emissions; conservation, and waste reduc- using direct generation as well • Conduct energy assessments and tion. Each year, these affiliates look Since 2014, approximately 30 per- as direct and indirect purchases for opportunities to enhance their cent of affiliate offices in emerging implement initiatives to enhance of renewable energy from local energy efficiency; environmental performance by markets have completed renova- utilities. At five facilities world- • Utilize alternative energy sources, new identifying and implementing new tions that include features such wide, we generate electric power projects and setting targets across as increased natural lighting, technologies, and best practices; and • Participate in local, regional, and/or more than 40 dimensions. We use energy-efficient lighting, and recy- 5 "Retrocommissioning” refers to a struc- a scorecard to assess progress in cling centers. We will continue to tured process for identifying suboptimal national forums to influence responsible these areas. In 2014 and 2015, of build upon these and other perfor- performance in an organization’s lighting, and cost-effective decision-making and heating, cooling, and other systems and policy development relative to energy. the 46 affiliates that assessed their mance improvement projects. making adjustments as needed.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 114 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
needs of the overall site. That is Other energy-related initiatives enough energy to power 1,600 include the following: homes, while avoiding roughly • Energy-focused webinars and 3,720 metric tonnes of CO e emis- 2 collaboration sites for Lilly energy sions annually. managers to share best practices Cogeneration, which involves using and make suggestions; and a combustion source to generate • Global Energy Week, an annual electricity on-site while also employee event that includes recovering usable heat from the poster presentations, videos, process, is another important part contests, guest speakers, and of our approach. During 2015, our energy-focused informational site in Kinsale, Ireland, finished booths to promote awareness of, construction on a new cogene- and progress toward, Lilly’s com- ration facility that commenced panywide energy-efficiency goal. operation during 2016. This unit will generate 4.4 MW of electricity In 2015, Lilly’s energy use to- At five facilities worldwide, we generate electric power using photovoltaic (PV) arrays. This is Lilly’s solar installation taled 11,000,000 million BTUs, a in Branchburg, New Jersey. and supply the site with 3.9 MW of steam and hot water thermal 1 percent decrease from 2014 and energy. It will reduce operating a 2 percent increase since 2012 PROGRESS TOWARD GOAL - ENERGY USE expenses by nearly $800,000 per (see graph). Our energy efficiency, year and decrease GHG emissions per square foot of site space, im- proved by 5 percent since 2014 and Direct 12.5 700 by 3,600 tonnes CO e per year. 2 by 1 percent from 2012 through Consumption 4.05 4.40 4.24 4.30 We also have three other sites 600 2015. Increases in production at Indirect with 10-MW, 4.3-MW, and 2.7-MW 10.0 some of our larger manufacturing Consumption 466 470 cogeneration units in operation. 450 446 500 sites, including those associated Energy Intensity 7.5 In 2015, we held a Global Energy with our animal health business, 400 Workshop, bringing regional and may challenge our ability to meet 6.76 6.89 6.93 6.72 2020 Goal 300 functional leaders from our top our goal of a 20 percent improve-
Trillion BTUs Trillion 5.0 10 energy-consuming sites to ment by 2020. Although energy use 200 Indianapolis. The 2015 workshop per square foot has risen at some 2.5 feet square Million BTUs/1,000 provided a robust, proactive road- sites, changes in manufacturing 100 map for achieving a 20 percent processes that increase capacity 0.0 0 improvement in the company's have improved energy efficiency 2012 2013 2014 2015 energy efficiency.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 115 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
per unit of production and delayed Fegersheim, France, made prog- Jersey, the 2014 Energy Project that produce injectable products the need to build additional, or ress on its strategic roadmap of the Year award. The project require exceptionally high-quality expand existing, energy-intensive to implement energy reduction implemented a variety of energy water, while our utility opera- facilities. We will continue looking initiatives related to facilities, efficiency and energy infrastruc- tions use water for cooling and for improvement opportunities. utilities, and process equipment. ture improvements including to support steam boilers. Some Some of the main opportunities high-efficiency lighting upgrades, sites have updated to waterless Using Energy Audits to Identify identified include optimizing HVAC building envelope improvements, cooling systems, and others re- Improvement Opportunities equipment for existing and new boiler control upgrades, and the claim water for this purpose. To a in Kinsale, Ireland projects, reducing water-related installation of a new high-efficiency lesser extent, we consume water During 2015, our Kinsale, Ireland, energy use by fine-tuning purified chiller. Annual energy savings for domestic uses in our offices site completed internal energy as- water consumption, and installing associated with the project were (such as cafeterias, bathrooms, sessments to identify conservation heat pumps that capitalize on estimated at $700,000, with an and landscaping). Our Engineering measures to reduce power con- sources of cold water available in estimated energy use reduction Technical Center helps our sites sumption in internal energy oper- the local water table. of 4.5 million kWh and an annual identify water-saving technologies, ations (e.g., HVAC, purified water natural-gas use reduction of more and sites can apply for project generation, and steam generation) Initiatives implemented in 2015 than 56,000 therms. capital funding through Lilly’s when production facilities were and planned for 2016 and 2017 will Energy, Waste, Water, and Natural not in operation. The assessments achieve 60 percent of the site’s Resource Use Reduction Fund. resulted in electricity and natural long-term energy goals. Overall, Water Use gas reductions of more than 3,000 reflecting commitment from all Water is a key input to our prod- megawatt hours (MWh) and approx- of the site’s functions, the site ucts and manufacturing processes WATER INTAKE imately $260,000 in savings in 2015. completed 16 initiatives in 2014 and and is essential to our business. The site also gradually reduced the 2015 that will save 6.3 million kWh Predicted future regional water exhaust temperature on one of its of energy annually, representing 15 scarcity, increased costs, and 15.0 air pollution control devices, de- 7 percent of the location’s overall 14.2 climatic changes have further 13.4 13.7 creasing the amount of steam used consumption. This will also reduce 12 strengthened our commitment to in the unit. This enhancement saved GHG emissions by more than use this resource wisely. In 2015, more than 4,000 MWh in natural 840 metric tonnes CO e and save 9 2 our water management efforts gas usage and over $160,000 on an $340,000. received a B rating from the CDP’s annual basis. 6
Saving Energy in Branchburg, water program, well above the Billion Liters Improving Energy Efficiency New Jersey industry sector average. in Fegersheim, France In 2015, the New Jersey Associa- 3 Manufacturing operations ac- Based on a detailed energy map- tion of Energy Engineers awarded count for the majority of the water ping, during 2014, our site in Lilly’s site in Branchburg, New 0 consumed by Lilly. Our operations 2012 2013 2014 2015
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 116 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
In 2014 and 2015, Lilly worked In 2015, Lilly’s water intake6 Waste • Send waste to landfill only when with the University of California, equaled 14.2 billion liters, 5 percent Lilly uses the following hierarchy the options above are not feasible. Santa Barbara (UCSB), and Kaiser less than 2014 and a 6 percent to manage waste: In 2013, we introduced a goal to Permanente to develop a water risk increase since 2012 (see graph on achieve a 20 percent improvement • Eliminate or reduce the amount analysis framework for the supply page 116). This increase was pri- in waste efficiency7 by 2020, com- of waste produced, chain of commodities (specialty marily due to production increases. pared to 2012, while increasing our chemicals, packaging, etc.) we We will continue to seek opportuni- • Reuse materials when possible recycling rate above 70 percent purchase for two of our major dia- ties to decrease water usage. (often multiple times), and decreasing waste to landfill betes products for the U.S. market. In 2013, we introduced a goal • Recycle used materials to make below 10 percent of total waste. UCSB used the World Resources to reduce absolute phosphorus new products, Institute Aqueduct tool to identify During 2015, Lilly generated emissions in wastewater discharge first-tier suppliers located in wa- • Recover energy from waste, 252,000 metric tonnes of total by 15 percent by 2020, compared ter-stressed areas and developed waste, 15 percent less than in 2014 to 2014. This goal addresses an • Treat waste to reduce toxicity a system to evaluate commodities and 12 percent less than in 2012. issue that is increasingly import- and volume, and produced in areas of relatively ant to communities, regulators, high water risk. The insight gained and investors. In 2015, while still in into water-related risk associ- TOTAL WASTE GENERATION* our planning phase to achieve this ated with suppliers can better goal, total phosphorus emissions inform future sourcing decisions. to wastewater equaled 133 metric Hazardous 350 We are now using the informa- 24 tonnes, a 5 percent increase from Waste Generation 24 tion to assess if current supplier 26 2014. Significant source reduc- 280 25 risk-management practices are Non-Hazardous 286 tion will require phasing out and Waste Generation 271 adequate and to determine if addi- 259 replacing cleaning agents with 210 tional data are needed to support 226 non-phosphorus based alterna- sound risk-management decisions. 140 tives. Technical teams at Lilly are We are also evaluating how we evaluating existing cleaning pro- might apply a similar framework to Thousand Metric Tonnes 70 cesses and will apply findings to * Total waste may vary as the other products. Learn more in this result of non-routine waste such key sites worldwide. as waste from construction and 0 project summary. demolition work. 2012 2013 2014 2015
6 “Water intake” is the total amount of such as irrigation. The term does not extracted from wells solely for the purpose materials that are deemed “reused” without water coming into a site, including water include groundwater pumped solely for of lowering the groundwater table(s) to extensive processing. Examples include pumped from bodies of surface water and treatment to satisfy regulatory actions or maintain the physical and structural integ- coal ash reused for mine reclamation or groundwater, as well as water provided by requirements (e.g., remediation activities rity of building foundations. road base, and mycelia and urea reused for a utility. It includes water used in process- where the water is not used for another 7 Per unit of production or site-relevant fertilizer. es, utilities, and other ancillary operations, purpose). Values do not include the water index. Lilly’s waste goals do not include
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 117 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
We improved our recycling rate to this site reduced the amount of offer online purchasing tools glob- DECREASING ENVIRONMENTAL 51 percent in 2015, up from 47 per- the solvent acetic acid required to ally that inform employees who IMPACTS IN PRODUCTION cent in 2012, and sent 26 percent purify a product and made it possi- order these goods if items with of waste to landfill, compared to 28 ble to recycle the liquid instead of recycled content are available. We In 2014, after performing a detailed environ- percent in 2012 (these calculations incinerating it as in the past. These have also expanded our green pro- mental assessment, we launched a stream- do not include waste that was ben- changes reduced fresh acetic acid curement program to cover areas lined process for manufacturing the active eficially reused). During the year, use by 16 percent, enabled the such as product transport, manu- pharmaceutical ingredient in our insulin 25 of 52 Lilly sites globally reported site to recycle 62 percent of used facturing, and research. product in Indianapolis. The new process sig- “zero-landfill” status (indicating acetic acid, and decreased waste nificantly increased manufacturing capacity that they send less than 0.5 per- liquid by 35 percent. to meet projected demand for this lifesaving cent of generated waste to landfill). Other Air Emissions drug. These changes reduced both purified water use and process waste generation by Lilly tracks emissions of com- From 2012 through 2015, our 30 percent per unit of production, without Supply Chain Sustainability pounds that can affect air quality. waste efficiency decreased by 56 increasing per unit solvent and urea waste In our contracts with key suppliers, The company’s most significant air percent, based on temporary cir- volumes. These improvements avoid the need we outline the HSE principles that emissions, other than GHGs, in- cumstances at a few of our sites. for additional capacity and corresponding we ask our contract manufacturing clude volatile organic compounds One main factor impacting waste energy use and GHG emissions. In 2015, we operations (CMOs) to follow. They (VOCs), as well as sulfur dioxide efficiency was a temporary waste implemented a similar conversion at our plant require the completion of an initial (SO ) and nitrogen oxides (NO ) processing change at our Clinton, 2 X in Puerto Rico, further reducing Lilly’s global HSE assessment and subsequent from the combustion of natural environmental footprint. Indiana, animal health site in 2014, updates every two years, the de- gas, oil, and coal. requiring more waste to be sent velopment and implementation of for incineration and to landfill. We protective HSE procedures, and, also expanded our insulin manu- if requested, action and ongoing OTHER AIR EMISSIONS facturing process at our Carolina, dialogue with Lilly on HSE per- Puerto Rico, site, which increased formance improvement. Lilly has 2,000 the amount of byproduct produced SO2 1,844 used qualified HSE professionals 1,694 beyond the amount that could be 1,585 to assess performance at our NOX reused as a fertilizer ingredient, CMOs for more than a decade. 1,500 resulting in some of this mate- Volatile Organic Compounds 1,060 rial being landfilled. We continue 975 Lilly continues to expand our pro- 1,000 883 to seek opportunities to increase curement efforts to decrease the Particulate Matter 744 730 534 561 waste efficiency. company’s environmental im- Metric Tonnes 500 608 pacts and to support markets for 529 Improving Process Efficiency and 167 176 168 greener products. Office supplies 113 Reducing Waste in Wusi, China remain an area of focus, and we 0 Through use of enhanced filtration, 2012 2013 2014 2015
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 118 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
In 2015, emissions to air of these species from 10 acres of land, 94-mile corridor of the Wabash Lilly experienced five reportable compounds decreased by nine and spreading more than 1,000 River and Sugar Creek to con- permit-limit exceedances in 2015, percent from 2014. cubic yards of mulch. Work con- serve fish and wildlife, promote up from three in 2014 but down tinued on our multiyear project to outdoor recreation, and improve from eight in 2012 and a decrease educate our employees and the the overall health of the Wabash of approximately 90 percent during Biodiversity communities where we operate River ecosystem. the last decade. The exceedances Lilly has a long history of col- about local water resources— in 2015 had to do with storm water laborating to protect habitat and part of a larger citywide collab- and wastewater-related permits. reduce the impact of our opera- oration called “Reconnecting to Environmental Compliance These exceedances were deter- tions on ecosystems. We pursue a Our Waterways.” Learn more Lilly’s Health, Safety, and Environ- mined to have no material impact tailored approach, recognizing that about Lilly’s focused, highly col- ment Policy requires compliance on the environment, and we did not biodiversity challenges and oppor- laborative approach to restoring with applicable regulations wher- receive any related agency findings tunities vary based on location, and biodiversity progress in the ever we do business, and we apply or penalties. See the Environmental we engage in conservation proj- Indianapolis area. our high standards even when Performance Indicators table on existing laws and regulations are ects and habitat enhancements • Clinton, Indiana – As a partner page 120 for details. inadequate. (For more information at many sites worldwide. We also in the Wabash River Wildlife about our HSE policies, standards, support conservation efforts in the Corridor Project, our Clinton and management systems, see TOTAL REPORTABLE communities where our facilities Labs site planted additional page 106.) If it is determined that PERMIT-LIMIT EXCEEDANCES are located. acreage with native grasses and we are out of compliance, we work riparian vegetation to enhance Examples include the following: to remedy the situation as quickly the existing 100-acre wildlife 8 as possible and to continuously 8 • Indianapolis, Indiana – As a part corridor on Lilly-owned land of Lilly’s annual Global Day of improve our performance. along the Wabash River. The 6 Service, in 2015, we continued work was part of the Healthy Using statistics-based environ- our work enhancing biodiversity Rivers Initiative, the largest mental capability assessments, 5 5 and promoting a healthy urban conservation initiative in Indiana we routinely review more than 50 4 ecology in the community of our history. The project involves a environmental compliance-related 3 corporate headquarters. Lilly partnership of agencies and processes across Lilly. We use 2 volunteers logged more than organizations working together the results to continually improve 13,600 hours, planting more with willing landowners to per- these processes and maintain 0 than 1,000 trees and nearly 9,900 manently protect 43,000 acres compliance. 2012 2013 2014 2015 plants, removing invasive plant of floodplain habitat along a
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 119 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Environmental Performance Indicators8,9
2012 2013 2014 2015 Greenhouse Gas Emissions
Greenhouse Gas Emissions (Scope 1 and Scope 2) (metric tonnes CO2e) 1,550,000 1,600,000 1,540,000 1,540,000 Scope 1 436,000 486,000 460,000 472,000
Scope 2 1,120,000 1,110,000 1,080,000 1,070,000
Greenhouse Gas Emissions Intensity (metric tonnes CO2e/1,000 square feet) 64.7 66.0 64.9 62.4 Greenhouse Gas Emissions Intensity (related to goal) 57.1 58.3 57.7 55.1 (metric tonnes CO2e/1,000 square feet)
Greenhouse Gas Emissions Intensity (metric tonnes CO2e/million $ revenue) 68.8 69.2 78.6 77.2 Scope 3 Emissions (not included in metrics above)10
Employee Business Travel (personal car, taxi, rental car, rail, and air travel) 99,000 94,000 68,000 90,000 (metric tonnes CO2e)
Employee Commuting (metric tonnes CO2e) 72,000 71,000 72,000 75,000
Product Transportation and Distribution (contracted) (metric tonnes CO2e) 45,000 30,000 18,000 16,000
Waste Generated in Operations (metric tonnes CO2e) 75,000 89,000 104,000 114,000
Non-Kyoto Compound Emissions (refrigerants, VOCs, etc.) (metric tonnes CO2e) 15,000 17,000 28,000 9,000 Energy Use
Energy Consumption (million BTUs) 10,800,000 11,300,000 11,200,000 11,000,000
Energy Intensity (million BTUs/1,000 square feet) 450 466 470 446
Energy Intensity (million BTUs/million $ revenue) 478 489 570 552
Direct Energy Consumption (million BTUs) 4,050,000 4,400,000 4,240,000 4,300,000
Coal (million BTUs) 690,000 1,340,000 1,300,000 1,300,000
Natural Gas (million BTUs) 2,840,000 2,530,000 2,410,000 2,490,000
Fuel Oil (million BTUs) 476,000 482,000 465,000 348,000
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2012 2013 2014 2015
Liquid Propane (million BTUs) 40,400 42,400 49,600 152,000
Gasoline (million BTUs) 4,720 4,680 3,810 7,710
Indirect Energy Consumption (million BTUs) 6,760,000 6,890,000 6,930,000 6,720,000
Purchased Electricity (million BTUs) 4,550,000 4,520,000 4,420,000 4,420,000
Purchased Steam (million BTUs) 2,200,000 2,360,000 2,510,000 2,300,000
Purchased Chilled Water (million BTUs) 3,370 13,800 5,380 8,370 Water Use
Water Intake (billion liters)11 13.4 13.7 15.0 14.2
Municipal (billion liters) 6.2 6.9 7.1 7.5
Surface (billion liters) 0.1 0.1 0.1 0.1
Groundwater (billion liters) 7.2 6.8 7.8 6.6
Water Intensity (million liters/million $ revenue) 0.594 0.593 0.762 0.713
Phosphorus emissions to wastewater (metric tonnes) -- -- 127 133 Waste
Total Waste Generation (metric tonnes) 285,000 310,000 295,000 252,000
Hazardous Waste Generation (metric tonnes) 26,000 24,000 24,000 25,000
Non-Hazardous Waste Generation (metric tonnes) 259,000 286,000 271,000 226,000
Total Waste Generation not Including Reuse (for recycling goal) (metric tonnes)12 74,000 75,000 89,000 113,000
Waste Disposition
Beneficially Reused (metric tonnes) 211,000 235,000 206,000 139,000
Recycled (includes combustion with energy recovery) (metric tonnes) 34,300 32,500 46,700 56,800
Treated (includes combustion without energy recovery) (metric tonnes) 18,700 19,900 30,100 26,500
Landfilled (metric tonnes) 20,700 22,600 12,000 29,100
Waste Recycling Rate 47% 43% 53% 51%
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2012 2013 2014 2015 Other Air Emissions
Volatile Organic Compound Emissions (metric tonnes) 608 534 561 529
Particulate Matter (metric tonnes) 113 167 176 168
SO2 Emissions (metric tonnes) 975 1,844 1,694 1,585
NOx Emissions (metric tonnes) 744 1,060 883 730
Ozone Depletion Potential (kg CFC-11 equivalent) 7,595 8,669 14,787 6,494 Environmental Compliance
Reportable Permit-Limit Exceedances13 8 5 3 5
Number of Significant Spills14 0 0 0 0
Environmental Fines Paid ($) $732 $0 $ 0 $0 Energy, Waste, Water, and Natural Resource Use Reduction Fund Expenditures ($ millions) $1.1 $1.8 $1.6 $1.7
8 Data may be revised compared to prior reports due to changes in calculation methodology 12 Lilly’s waste goals do not include materials that are deemed “reused” without extensive and other factors. Some segments do not add up to totals due to rounding. processing. Examples include coal ash reused for mine reclamation or road base, and myce- 9 In 2015, adjustments were made to data for all years to reflect the acquisition of animal lia and urea reused for fertilizer. health operations from Lohmann (closed April 30, 2014) and Novartis (closed January 15, 13 Lilly classifies an event as a reportable permit-limit exceedance if it involves an exceed- 2015). ance of a numeric permit or license limit that must be reported to the regulatory authority. 10 These data do not include sales force travel using company vehicles, use of Lilly aircraft, The reporting may be immediate (e.g., within 24 hours) or in a routine compliance report. or product distribution with Lilly vehicles. Those items are Scope 1 and included in the These exceedances do not necessarily result in harm to people or the environment. data above. 14 “Significant spill” in this report refers to any unexpected, unintended, abnormal, or 11 “Water intake” is the total amount of water coming into a site, including water pumped unapproved dumping, leakage, drainage, seepage, discharge, or other loss of a substance from bodies of surface water and groundwater, as well as water provided by a utility. It in- that resulted in damage to the environment (i.e., human health, aquatic life, or wildlife) or a cludes water used in processes, utilities, and other ancillary operations, such as irrigation. material event requiring reporting to the U.S. Securities and Exchange Commission. Damage The term does not include groundwater pumped solely for treatment to satisfy regulatory means the actual or imminent alteration of the environment so as to render the environment actions or requirements (e.g., remediation activities where the water is not used for another harmful, detrimental, or injurious. purpose). Values do not include the water extracted from wells solely for the purpose of low- ering the groundwater table(s) to maintain the physical and structural integrity of building foundations. Totals include a small amount of rainwater intake not included in other water intake subcategories.
ELI LILLY AND COMPANY 2015 INTEGRATED REPORT 122 Overview Business Review Advancing Medical Science Improving Global Health Strengthening Communities Operating Responsibly Global Reporting Initiative U.N. Global Compact
Global Reporting Initiative Index Lilly recognizes the value that common reporting standards, such as the Global Reporting Initiative (GRI) G4 guide- lines, provide for stakeholders and for companies seeking to transparently report on their corporate responsibility activities. While we are not declaring an accordance level with GRI guidelines for this report, we have prepared a GRI G4 index to aid readers looking for specific information. This index shows which G4 indicators are covered in this report and other public documents and provides a reference readers can follow to find the related information.
General Standard Disclosures
INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER Strategy and Analysis
G4-1 CEO statement on sustainability CEO Letter
G4-2 Description of key impacts, risks, and opportunities Business Review 2015 Form 10-K Organizational Profile
G4-3 Name of the organization About Lilly, About Elanco
G4-4 Primary brands, products, and/or services About Lilly, About Elanco
G4-5 Location of organization's headquarters Indianapolis, IN
G4-6 Number of countries where the organization operates, and countries with major operations or 2015 Form 10-K relevant to sustainability issues
G4-7 Nature of ownership and legal form 2015 Form 10-K
G4-8 Markets served About Lilly, About Elanco, Stakeholder Engagement
G4-9 Scale of the reporting organization 2015 Form 10-K
G4-10 Employees by employment contract and gender Workplace
G4-11 Percentage of employees covered by collective bargaining agreements Workplace
G4-12 Description of supply chain Supply Chain
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER
G4-13 Significant changes to size, structure, or ownership 2015 Form 10-K
G4-14 Whether and how the precautionary approach or principle is addressed Product Stewardship
G4-15 Externally developed economic, environmental, and social charters, principles, or initiatives About this Report, Efforts to Improve Health Literacy, Ethics the organization subscribes or endorses and Transparency, Supply Chain, Animal Care and Use, Environmental Stewardship
G4-16 Association memberships Memberships Identified Material Aspects and Boundaries
G4-17 Entities included in consolidated financial statements and if any are not in report About this Report
G4-23 Significant changes from previous reporting period About this Report Stakeholder Engagement
G4-24 Stakeholder groups engaged by the organization Stakeholder Engagement
G4-25 How stakeholders are identified and selected Stakeholder Engagement
G4-26 Approaches to stakeholder engagement, including frequency of engagement by type and by Stakeholder Engagement stakeholder group
G4-27 Key concerns raised through stakeholder engagement, and how the organization responded Promoting Responsible Use of Antibiotics in Food-producing Animals, Transforming Clinical Trials Report Profile
G4-28 Reporting period About this Report
G4-29 Most recent report May 2015
G4-30 Reporting cycle Annually
G4-31 Contact for sustainability report About this Report
G4-32 Table with Standard Disclosure locations GRI Index
G4-33 External assurance statement About this Report, Scope of Health, Safety, and Environment Data
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER Governance
G4-34 Governance structure 2015 Proxy Statement
G4-37 Consultation between stakeholders and the highest governance body on sustainability issues Shareholders can communicate with the board of directors in writing via the corporate secretary’s office. In general, formal mechanisms are not in place for employees to make recommendations directly to the board; however, the leadership team encourages employees to provide feedback to management through a variety of communication channels, including a compliance hotline, internal town hall style meetings, and on the CEO’s blog. In addition, under the company’s processes for reporting suspected ethics or compliance breaches, under certain circumstances designated employees are allowed or required to report the suspected breach directly to the relevant committee of the board of directors.
G4-38 Details on composition of organization's highest governance body and its committees 2015 Proxy Statement
G4-39 Whether Chair of highest governance body is also an executive officer 2015 Proxy Statement
G4-40 Processes nominating and selecting highest governance body and its committees 2015 Proxy Statement
G4-41 Highest governance body process for avoiding and disclosing conflicts of interest Ethics, Compliance, and Governance, 2015 Proxy Statement
G4-43 Process for enhancing highest governance body's competencies on economic, environmental, 2015 Proxy Statement and social issues
G4-44 Process for evaluating highest governance body's performance on economic, environmental, 2015 Proxy Statement and social topics
G4-45 Highest governance body's role in risk management 2015 Proxy Statement
G4-46 Highest governance body’s role in the identification and management of economic, 2015 Proxy Statement environmental and social impacts, risks, and opportunities
G4-47 Frequency of the highest governance body’s review of economic, environmental and social 2015 Proxy Statement impacts, risks, and opportunities
G4-49 Process for communicating critical concerns to the highest governance body See note for G4-37
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER
G4-51 Remuneration policies for the highest governance body and senior executives 2015 Proxy Statement
G4-52 Process for determining remuneration 2015 Proxy Statement
G4-53 How stakeholders’ views are sought and taken into account regarding remuneration 2015 Proxy Statement Ethics and Integrity
G4-56 Organization’s values, principles, standards and norms of behavior such as codes of conduct Ethics and Transparency and codes of ethics
G4-57 Internal and external mechanisms for seeking advice on ethical and lawful behavior, and Bioethics , Ethics, Compliance, and Governance organizational integrity
G4-58 Internal and external mechanisms for reporting concerns about unethical or unlawful behavior Ethics, Compliance, and Governance
Specific Standard Disclosures
INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER Economic Economic Performance
DMA Disclosure on management approach Business Review, 2015 Form 10-K
G4-EC1 Direct economic value generated and distributed Business Review, 2015 Form 10-K
G4-EC2 Financial implications and other risks and opportunities due to climate change Greenhouse Gas Emissions
G4-EC3 Coverage of the organization's defined benefit plan obligations 2015 Form 10-K Indirect Economic Impacts
DMA Disclosure on management approach Improving Global Health, Strengthening Communities
G4-EC7 Development and impact of infrastructure investments and services supported Strengthening Communities
G4-EC8 Significant indirect economic impacts, including the extent of impacts Improving Global Health, Hunger Relief
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER Environmental Materials
DMA Disclosure on management approach A Lifecycle Focus, How We Manage Environmental Issues, Product Stewardship
G4-EN2 Percentage of materials used that are recycled input materials Materials Use Energy
DMA Disclosure on management approach A Lifecycle Focus, How We Manage Environmental Issues, Product Stewardship, Energy Use
G4-EN3 Energy consumption within the organizations Energy Use, Environmental Performance Indicators
G4-EN5 Energy intensity Energy Use, Environmental Performance Indicators
G4-EN6 Reduction of energy consumption Energy Use Water
DMA Disclosure on management approach A Lifecycle Focus, How We Manage Environmental Issues, Product Stewardship, Water Use
G4-EN8 Total water withdrawal by source Water Use, Environmental Performance Indicators Biodiversity
DMA Disclosure on management approach How We Manage Environmental Issues, Pharmaceuticals in the Environment, Biodiversity
G4-EN13 Habitats protected or restored Biodiversity Emissions
DMA Disclosure on management approach A Lifecycle Focus, How We Manage Environmental Issues, Product Stewardship, Greenhouse Gas Emissions, Energy Use, Other Air Emissions
G4-EN15 Direct greenhouse gas (GHG) emissions (Scope 1) Greenhouse Gas Emissions, Environmental Performance Indicators
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER
G4-EN16 Energy indirect greenhouse gas (GHG) emissions (Scope 2) Greenhouse Gas Emissions, Environmental Performance Indicators
G4-EN17 Other indirect greenhouse gas (GHG) emissions (Scope 3) Environmental Performance Indicators
G4-EN18 Greenhouse gas (GHG) emissions intensity Greenhouse Gas Emissions, Environmental Performance Indicators
G4-EN19 Reduction of greenhouse gas (GHG) emissions Greenhouse Gas Emissions
G4-EN20 Emissions of ozone-depleting substances (ODS) Environmental Performance Indicators
G4-EN21 NOx, SOx and other significant air emissions Other Air Emissions, Environmental Performance Indicators Effluents and Waste
DMA Disclosure on management approach A Lifecycle Focus, How We Manage Environmental Issues, Product Stewardship, Water Use, Waste
G4-EN23 Total weight of waste by type and disposal method Waste, Environmental Performance Indicators
G4-EN24 Total number and volume of significant spills Environmental Performance Indicators
G4-EN25 Weight of transported, imported, exported, or treated waste deemed hazardous under the Waste, Environmental Performance Indicators terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally Products and Services
DMA Disclosure on management approach A Lifecycle Focus, How We Manage Environmental Issues, Product Stewardship
G4-EN27 Extent of impact mitigation of environmental impacts of products and services Innovations in Green Chemistry, Decreasing Environmental Impacts in Production
G4-EN28 Percentage of products sold and their packaging materials that are reclaimed by category Product End of Life Compliance
DMA Disclosure on management approach How We Manage Environmental Issues, Environmental Compliance
G4-EN29 Monetary value of significant fines and total number of non-monetary sanctions for non- Environmental Compliance, Environmental Performance compliance with environmental laws and regulations Indicators
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER Transport
DMA Disclosure on management approach A Lifecycle Focus, Product Stewardship, Decreasing Environmental Impacts in Sales and Marketing
G4-EN30 Significant environmental impacts of transporting products and other goods and materials for Decreasing Environmental Impacts in Sales and Marketing, the organization's operations, and transporting members of the workforce Environmental Performance Indicators Overall
DMA Disclosure on management approach Energy Use, Water Use, Waste, Energy, Waste, Water, and Natural Resource Use Reduction Fund
G4-EN31 Total environmental protection expenditures and investments by type Energy Use, Water Use, Waste, Energy, Waste, Water, and Natural Resource Use Reduction Fund Supplier Environmental Assessment
DMA Disclosure on management approach How Lilly Manages Supply Risk, Pharmaceutical Industry Principles for Responsible Supply Chain Management, Product Stewardship, Water Use, Supply Chain Sustainability
G4-EN32 Percentage of new suppliers that were screened using environmental criteria Supply Chain Sustainability, Maintaining and Monitoring Quality, Safety, and Security of Supply
G4-EN33 Significant actual and potential negative environmental impacts in the supply chain and actions Maintaining and Monitoring Quality, Safety, and Security of taken Supply, Water Use, Supply Chain Sustainability
Social: Labor Practices and Decent Work Employment
DMA Disclosure on management approach Workplace
G4-LA2 Benefits provided to full-time employees that are not provided to temporary or part-time A Culture of Well-Being employees, by significant locations of operation Occupational Health and Safety
DMA Disclosure on management approach Employee Health and Safety, and Wellness
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER
G4-LA5 Percentage of total workforce represented in formal joint management-worker health and Lilly does not formally measure the percentage of our total safety committees that help monitor and advise on occupational health and safety programs workforce represented in joint management-worker health and safety committees. An estimated 80 percent of our global workforce members utilize health and safety committees to assist in the management of local occupational health and safety programs.
G4-LA6 Type of injury and rates of injury, occupational diseases, lost days, and absenteeism, and total Health and Safety Data number of work-related fatalities, by region and by gender
G4-LA8 Health and safety topics covered in formal agreements with trade unions Workplace Training and Education
DMA Disclosure on management approach Bioethics, Ethics, Compliance, and Governance, Animal Care and Use, Workplace
G4-LA9 Average hours of training per year per employee by gender, and by employee category Engaging Employees in Bioethics, Ethics, Compliance, and Governance, Animal Care and Use, A Coaching Culture, Learning and Development
G4-LA10 Programs for skills management and lifelong learning that support the continued employability A Coaching Culture, Learning and Development of employees and assist them in managing career endings
G4-LA11 Percentage of employees receiving regular performance and career development reviews, by A Coaching Culture gender and by employee category Diversity and Equal Opportunity
DMA Disclosure on management approach Diversity and Inclusion
G4-LA12 Composition of governance bodies and breakdown of employees per employee category Diversity and Inclusion according to gender, age group, minority group membership, and other indicators of diversity Supplier Assessment for Labor Practice
DMA Disclosure on management approach How Lilly Manages Supply Risk, Pharmaceutical Industry Principles for Responsible Supply Chain Management
G4-LA14 Percentage of new suppliers that were screened using labor practices criteria How Lilly Manages Supply Risk, Maintaining and Monitoring Quality, Safety, and Security of Supply
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER
G4-LA15 Significant actual and potential negative impacts for labor practices in the supply chain and How Lilly Manages Supply Risk actions taken Social: Human Rights Investment
DMA Disclosure on management approach How Lilly Manages Supply Risk
G4-HR2 Total hours of employee training on human rights policies or procedures concerning aspects of Every year, Lilly employees spend approximately 41,000 human rights that are relevant to operations, including the percentage of employees trained hours—a minimum of one hour per person—undergoing mandatory training on our code of conduct. The Red Book covers a broad spectrum of basic human-rights issues. Freedom of Association and Collective Bargaining
DMA Disclosure on management approach Workplace Child Labor
DMA Disclosure on management approach Upholding Human Rights Throughout the Supply Chain
G4-HR5 Operations and suppliers identified as having significant risk for incidents of child labor, and Upholding Human Rights Throughout the Supply Chain measures taken to contribute to the effective abolition of child labor Forced or Compulsory Labor
DMA Disclosure on management approach Upholding Human Rights Throughout the Supply Chain
G4-HR6 Operations and suppliers identified as having significant risk for incidents of forced or Upholding Human Rights Throughout the Supply Chain compulsory labor, and measures to contribute to the elimination of all forms of forced or compulsory labor Supplier Human Rights Assessment
DMA Disclosure on management approach Upholding Human Rights Throughout the Supply Chain, Pharmaceutical Industry Principles for Responsible Supply Chain Management, Conflict Minerals
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER
G4-HR10 Percentage of new suppliers that were screened using human rights criteria None of Lilly’s suppliers and contractors have undergone a formal screening on human rights. Globally, we set strict expectations for our suppliers and vendors relating to human rights. Lilly’s Supplier Code of Business Conduct, a publicly available document, sets an expectation that: “We conduct our business activities with respect for people and a commitment to diversity, equal opportunity, and freedom from exposure to improper conduct and discrimination.” For more information, see Upholding Human Rights Throughout the Supply Chain Social: Society Local Communities
DMA Disclosure on management approach Improving Global Health, Hunger Relief, Strengthening Communities
G4-SO1 Percentage of operations with implemented local community engagement, impact Improving Global Health, Hunger Relief, Strengthening assessments, and development programs Communities Anti-Corruption
DMA Disclosure on management approach Ethics, Compliance, and Governance
G4-SO3 Total number and percentage of operations assessed for risks related to corruption and the Anti-Corruption Due Diligence significant risks identified
G4-SO4 Communication and training on anti-corruption policies and procedures Ethics, Compliance, and Governance Public Policy
DMA Disclosure on management approach Advancing Public Policy, Political Engagement
G4-SO6 Total value of political contributions by country and recipient/beneficiary Political Engagement
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INDICATOR SUMMARY REPORT REFERENCE OR DIRECT ANSWER Compliance
DMA Disclosure on management approach Ethics and Transparency Supplier Assessment for Impacts on Society
DMA Disclosure on management approach How Lilly Manages Supply Risk, Pharmaceutical Industry Principles for Responsible Supply Chain Management
G4-SO9 Percentage of new suppliers that were screened using criteria for impacts on society How Lilly Manages Supply Risk, Pharmaceutical Industry Principles for Responsible Supply Chain Management Social: Product Responsibility Customer Health and Safety
DMA Disclosure on management approach Global Patient Safety, Counterfeit Medicines
G4-PR1 Percentage of significant product and service categories for which health and safety impacts Lilly's Quality System, Global Patient Safety, Counterfeit are assessed for improvement Medicines Product and Service Labeling
DMA Disclosure on management approach Global Patient Safety, Efforts to Improve Health Literacy
G4-PR3 Type of product and service information required by the organization's procedures for product Global Patient Safety, Efforts to Improve Health Literacy and service information and labeling, and percentage of significant product and service categories subject to such information requirements Marketing Communications
DMA Disclosure on management approach Marketing Practices Customer Privacy
DMA Disclosure on management approach Privacy
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United Nations Global Compact Index Eli Lilly and Company is proud to voice our continued support for the UNGC principles. Our website, www.lilly.com, contains detailed information about our company policies, procedures, and programs that are related to the UNGC, including information on our workplace policies, ethics, and transparency, as well as our environmental impacts and programs.
UNGC PRINCIPLE INFORMATION IN REPORT
1 Businesses should support and respect the protection of internationally proclaimed Supply Chain human rights.
2 Businesses should make sure they are not complicit in human rights abuses. Supply Chain, Workplace
3 Businesses should uphold the freedom of association and the effective recognition of the right to collective Workplace bargaining.
4 Businesses should uphold the elimination of all forms of forced and compulsory labour. Supply Chain
5 Businesses should uphold the effective abolition of child labour. Supply Chain
6 Businesses should uphold the elimination of discrimination in respect of employment and occupation. Workplace
7 Businesses should support a precautionary approach to environmental challenges. Environmental Stewardship
8 Businesses should undertake initiatives to promote greater environmental responsibility. Environmental Stewardship
9 Businesses should encourage the development and diffusion of environmentally friendly technologies. Environmental Stewardship
10 Businesses should work against corruption in all its forms, including extortion and bribery. Ethics and Transparency
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