Eli Lilly and Company – Tailored Therapeutics and Diagnostics © Eli Lilly and Company 2012 The views and opinions expressed herein and/or during the accompanying.

© Eli Lilly and Company 2012

Eli Lilly and Company –

Tailored Therapeutics and Diagnostics

The views and opinions expressed herein and/or during the accompanying discussion are those of the author and do not necessarily represent the policies, viewpoints, or business of Eli Lilly and Company or its management.

Robert L. SharpPatent CounselEli Lilly and Company

© Eli Lilly and Company 2012 2

Eli Lilly and Company- Fast Facts

• 10th largest pharmaceutical company in the world

38,000 employees; 7,400 employees engaged in R & D

products marketed in 125 countries

• Mission: Make medicines that help people live longer, healthier, more

active lives

• Strategy: Create value for all our stakeholders by accelerating the flow of

innovative medicines that provide improved outcomes for individual

patients.

© Eli Lilly and Company 2012 3

A heritage more than 135 years strongFounded in May 1876 by U.S. Civil War veteran Colonel Eli LillyThree generations of Lilly family leadership defined today’s core values:

• Respect for people• Integrity• Thirst for excellence

Colonel Lilly’s priorities• Manufacture high-quality products• Recruit the best employees• Satisfy the customer• Develop new products

Eli Lilly and Company- Heritage

First research policy established in 1898“To contribute to the progress of medicine by developing new and superior agents through research.”

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Lilly’s Strategy - Innovation Driven

• Lilly’s fundamental strategy is predicated on innovation• The science has never been more promising and the need for new

medicines never greater• Lilly currently has the richest mid-to-late stage pipeline in its history,

with 13 molecules currently in Phase III clinical development― 13 molecules are in Phase II testing― 22 molecules are in Phase I testing

• R&D expenditures total $5 BILLION in 2011• R&D as a percentage of workforce and sales: both 20 percent• Cost of a new pharmaceutical

– average cost to discover/develop a new drug = $800 to $1.2 BILLION– average length of time from discover to patient = 10 to 15 years– only one new chemical entity (NCE) out of 10,000 candidates will make it to launch

© Eli Lilly and Company 2012 5

Eli Lilly and Company – Tailored Therapies and Diagnostics

The rise of personalized medicine is one of the most important developments inhealth care today. Personalized medicine will change health care almost acrossthe board . . . But nowhere, I would argue, are the cross-currents of change morepowerful or the stakes higher than in the development, manufacture, and sale ofprescription medicines. In my industry, we would be powerless to resistpersonalized medicine, not to say foolish.

[W]e are not only on board [with personalized medicine], we’re also trying inrecent years to . . . put others on board and our business model willaccommodate personalized medicine – in fact, it may depend on it.

John Lechleiter – President and COO, Eli Lilly and Co. (now CEO and Chairman)Conference on Personalized Medicine: A Call to Action, Boston, November 29, 2007

Biomarker strategies in place for nearly all molecules at the earliest clinical development stage.

Diagnostics to help demonstrate that a medicine is having the intended effect and will identify: The right patient, the right dose, the right time

Evolution of Lilly - FIPNet

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No single company, industry, agency, or even nation will add very much to improving human health by working on its own. Rather, accelerating the development of new medicines will depend on collaboration, flexibility, and trust.

Sidney Taurel– Chairman and CEO, Eli Lilly and Co. Wharton Health Care Business Conference – Speaking on Tailored Therapeutics, March 2008

Fully Integrated Pharmaceutical Network (FIPNet)• Access to ideas/capabilities we don't possess; "many sources, share risk, share

work” -Lillypedia• Being a FIPNET = leveraging external competencies and collaboration will be a

primary driver

Evolving Complexity

Diagnostic Cos.Clinical

Laboratories

Health Care

Providers

PatientsPharma

Cos.Research Institutions

PayersPatent Holders

FD

A Waived (Class I novel device)

510(k) or “de novo” (Class 2 device, market clearance)

PMA (Class 3 device, Pre-Market Approval)

Complex, evolving scienceComplex, evolving, competitive industryComplex, evolving regulatory environmentComplex, evolving economicsComplex, evolving IP

7Copyright © 2012 Eli Lilly and Company

© Eli Lilly and Company 2012 8

Patient with diabetes before and two months after taking insulin

Lilly researchers collaborated with scientists at the University of Toronto to develop a process to mass-produce insulin.

The work resulted in the introduction of the world’s first commercial insulin product in 1923 by Eli Lilly and Company.

Why we do what we do - patients