Financial Risk Management at Eli Lilly and Company

In an effort to avoid government price controls, the company had launched LillyAnswers, a drug discount program for low-income seniors. The program allowed seniors to get prescription drugs for a small monthly fee, significantly reducing the overall cost for recurring medication needs. In 2002, Lilly recorded revenues of $11,077.5 million and a net income of $2,707.9 million¹.

Colonel Eli Lilly, pharmacist and Union officer in the Civil War, started Eli Lilly & Company in 1876 with $1,300, to make gelatin-coating pills.

Other products launched in the 1920s and 1930s included antiseptic Merthiolate, sedative Seconal, and treatments for pernicious anemia and heart disease.

Lilly researchers isolated the antibiotic erythromycin from a species of mold found in the Philippines in 1952. Lilly also became a major supplier of Salk polio vaccine.

In 1947, Lilly had begun selling diethylstilbestrol (DES), a drug to prevent miscarriages. Lilly enjoyed a 70% share of the DES market by 1971, when researchers noticed that a rare form of cervical cancer afflicted many of the daughters of women who had taken the drug...