2015 Lilly Report of Political Financial Support Public Policy As a biopharmaceutical company that is working to discover and bring life-changing medicines to those who need them, Lilly plays an important role in public health and its related policy debates. It is important that our company shapes global public policy debates on issues specific to the patients we serve and to our other key stakeholders including shareholders and employees. Our engagement in the political arena helps address the most pressing issues related to ensuring that patients have access to needed medications—leading to improved patient outcomes. Through public policy engagement, we provide a way for all of our locations globally to shape the public policy environment in a manner that supports access to innovative medicines. We engage on issues specific to local business environments. Based on our company’s strategy and the most recent trends in the policy environment, our company has decided to focus on the following key areas: health care reform, intellectual property, trade, tax reform, value-based pricing, and biosimilars. More detailed information on key issues can be found in our 2015 Integrated Report and on Lilly.com. Through our policy research, development, and stakeholder dialogue activities, Lilly develops positions and advocates on these key issues. U.S. Political Engagement Government actions such as price controls, pharmaceutical manufacturer rebates, and access to Lilly medicines affect our ability to invest in innovation. Lilly has a comprehensive government relations operation to have a voice in the public policymaking process at the federal, state, and local levels. Lilly is committed to participating in the political process as a responsible corporate citizen to help inform the U.S. debate over health care and pharmaceutical innovation. As a company that operates in a highly competitive and regulated industry, Lilly must participate in the political process to fulfill its fiduciary responsibility to its shareholders, and its overall responsibilities to its customers and its employees. When engaging in lobbying efforts or making political contributions, we comply with the laws that govern such activities. All financial support and lobbying activity are overseen at the Board level by the Public Policy and Compliance Committee (PPCC), which is composed entirely of outside directors. The PPCC members receive a copy of the “Lilly Report of Political Financial Support” annually and a detailed briefing on company political engagement every two years in alignment with the U.S. election cycle. We lobby and make political contributions only where allowed under law. All decisions are made without regard for the private personal preferences of the company’s officers and executives. All of our employees must also comply with the policies in our written “Code of Business Conduct,” The Red Book, which includes Lilly’s core values, legal obligations, and global policies, including our “Global Policy on Political Financial Support and Involvement.” All individuals who recommend political contributions in the U.S. are trained on our policies on corporate political contributions and LillyPAC contributions. Financial Support Elected officials, no matter what level, have an impact on public policy issues affecting Lilly. In the U.S., we are committed to backing candidates of any party who support public policies that contribute to the health needs of the patient, pharmaceutical innovation, and the interests of our company. In addition to disclosing support for individual candidates and independent expenditures, Lilly will disclose any company contributions to the political process via 527 organizations (e.g., political action committees for individuals or parties). Lilly will only fund other non-candidate expenditures by exception (e.g., certain ballot initiatives) and those contributions will be disclosed. The General Counsel and the Chief Financial Officer, or their designees, must approve all corporate political contributions before they are made. Our annual “Report of Political Financial Support” provides details of our company’s independent- political contributions; the activities of our political action committee, LillyPAC, which is funded solely by eligible employee contributions; and the governance processes for both. The LillyPAC Governing Board (the board) oversees all contributions made by LillyPAC. The board is comprised of 13 U.S.-based employees who represent components throughout the company. LillyPAC meets all disclosure requirements and is audited annually by Ernst and Young. For more information, view the reports for the current year and for four years of history: • 2015 Lilly Report of Political Financial Support (You are now viewing this report.) • Previous years’ (2011 to 2014) Lilly Report of Political Financial Support Lobbying Lilly invests in direct lobbying efforts at the federal, state, and local levels to educate policymakers on the specific implications that various legislation may have on the company, our community, and patients. Information on our federal lobbying activities is reported to the U.S. Congress in accordance with the Lobbying Disclosure Act of 1995. Information on our state lobbying activities is reported as required in those states where we engage in lobbying activities. For more information, view the following reports: • Q4 2015 U.S. Congress Lobbying Disclosure • Q3 2015 U.S. Congress Lobbying Disclosure • Q2 2015 U.S. Congress Lobbying Disclosure • Q1 2015 U.S. Congress Lobbying Disclosure • 2015 State Lobbying Disclosure: http://www.lilly.com/SiteCollectionDocuments/pdf/Public-Policy.pdf Memberships In addition to direct political contributions, Lilly maintains memberships in certain 501(c)4s – trade associations that report lobbying activity to the U.S. government. We support organizations that champion public policies that contribute to pharmaceutical innovation, healthy patients, and a healthy business climate. The “Lilly Report of Political Financial Support” also notes our memberships in trade associations that report lobbying activity to the U.S. government and to which we contribute $50,000 per year or more. Organizations where Lilly has a board seat are also noted. Memberships in 2015: American Feed Industry Association (board seat), Animal Health Institute (board seat), Biotechnology Industry Organization (board seat), Greater Indianapolis Chamber of Commerce (board seat), Healthcare Leadership Council, Indiana Chamber of Commerce (board seat), National Association of Manufacturers (board seat), PhRMA (board seat), and U.S. Chamber of Commerce. Lilly Corporate Contributions 2015 Candidate Organization / Committee State Party Office Amount Alabama Republican Party - Non-Federal Account AL R State Party $2,000 Governor Bentley Inaugural Foundation, Inc. AL R State Committee $3,000 Republican Party of Arkansas Business Council AR R State Party $1,500 House Victory PAC AZ R State House PAC $2,500 Senate Victory PAC AZ R State Senate PAC $2,500 Independent Voter PAC CA State PAC $10,000 Common Sense Values CO D State PAC $2,500 National Conference of State Legislatures CO $5,000 Bean, Aaron Aaron Bean for Florida State Senate FL R State Senate $1,000 Braynon, Oscar Committee to Elect Oscar Braynon FL D State Senate $500 Brodeur, Jason Committee to Elect Jason Brodeur FL R State House $1,000 Caldwell, Matt Committee to Elect Matt Caldwell FL R State House $750 Cruz, Janet Campaign to Re-elect Janet Cruz FL D State House $500 Cummings, W. Travis Campaign to Re-Elect W. Travis Cummings FL R State House $1,000 Diaz, Jose Felix Committee to Elect Jose Felix Diaz FL R State House $750 Flores, Anitere Committee to Elect Anitere Flores FL R State Senate $1,000 Galvano, Bill Bill Galvano for State Senate FL R State Senate $1,000 Grimsley, Denise Denise Grimsley State Senate Campaign FL R State Senate $500 Hager, Bill Committee to Elect Bill Hager FL R State House $750 Harrison, Shawn Committee to Elect Shawn Harrison FL R State House $750 Hudson, Matt Matt Hudson for Florida House of Representatives FL R State Senate $1,000 Lee, Tom Tom Lee Campaign FL R State Senate $1,000 Magar, Mary Lynn Committee to Elect Mary Lynn Mager FL R State House $1,000 Oliva, Jose Committee to Elect Jose Oliva FL R State House $1,000 Pigman, Cary Campaign for Cary Pigman FL R State House $750 Simpson, Wilton Committee to Elect Wilton Simpson FL R State Senate $1,000 Steube, W. Gregory Campaign to Re-elect W. Greg Steube FL R State House $750 Republican Party of Florida Senate Campaign Committee FL R State Party Committee $5,000 Burke, Dean Committee to Elect Dean Burke GA R State Senate $1,000 Cooper, Sharon Cooper for State House GA R State House $1,000 Howard, Henry "Wayne" Committee to Elect Henry "Wayne" Howard GA D State House $500 Jones II, Harold V. Committee to Elect Harold V. Jones II GA D State Senate $500 Kelley, Trey Committee to Elect Trey Kelley GA R State House $500 Meadows, John Elect John Meadows Committee GA R State House $1,000 Mullis, Jeff Committee to Elect Jeff Mullis GA R State Senate $1,000 Shafer, David Campaign to Elect David Shafer to State Senate GA R State Senate $1,000 Unterman, Renee Committee to Elect Renee Unterman GA R State Senate $1,000 Burke, Daniel Committee to Elect Dan Burke IL D State House $1,000 Clayborne, James Friends of Clayborne IL D State Senate $1,000 Connelly, Michael Citizens for Connelly IL R State Senate $1,000 Cullerton, John Citizens for John Cullerton for State Senate IL D State Senate $6,000 Cullerton, Tom Friends of Tom Cullerton IL D State Senate $1,000 DeLuca, Anthony Friends for State Rep Anthony DeLuca IL D State House $500 Durkin, Jim Citizens for Durkin IL R State House $7,000 Haine, Bill Friends of Bill Haine IL D State Senate $1,000 Hunter, Mattie Friends of Mattie Hunter IL D State Senate $1,500 Lightford, Kimberly Citizens for Lightford IL D State Senate $1,000 Madigan, Michael Friends of Michael J.