Eli Lilly and Company discovers, develops, manufactures, and markets products in a single business segment—human pharmaceutical products. The company operates in the highly competitive global pharmaceutical industry, facing intensifying competition worldwide, including from China and other markets that have significantly expanded and accelerated research and development capabilities. Key structural forces shaping competition include the high cost and uncertainty of pharmaceutical research and development, the expiration of intellectual property protection leading to generic and biosimilar competition, and intense pricing and reimbursement pressures from governments and private payers globally. Lilly's long-term success depends on its ability to continually discover or acquire, develop, and commercialize innovative medicines.

Lilly's products compete globally with many other pharmaceutical products in highly competitive markets. Important competitive factors include effectiveness, safety, availability, ease of use, patient preference, formulary placement, price, payer coverage and reimbursement rates, and research and development of new products. The company faces intensifying competition worldwide, including from China and other markets. Lilly believes its long-term competitive success depends on discovering and developing or acquiring and further developing innovative, cost-effective products. The company's ability to compete effectively depends on its capacity to innovate at the pace of global scientific advancement, to access innovation through strategic partnerships and licensing arrangements across geographies, and to efficiently bring differentiated products to market.

Lilly generates revenue primarily from two different types of contracts: product sales to customers (net product revenue) and collaborations and other arrangements. Net product revenue is recognized at the point where the customer obtains control of the goods, generally at the time of shipment. Provisions for rebates, discounts, and returns are established in the same period the related product sales are recognized. Collaboration and other revenue includes the company's share of profits from collaborations, as well as royalties, upfront and milestone payments. In the U.S., most products are distributed through wholesalers that serve pharmacies, physicians, and hospitals. Outside the U.S., Lilly promotes products to healthcare providers through sales representatives and other channels, and maintains its own sales organizations in many countries.

Lilly's products span four primary therapeutic areas: Cardiometabolic Health, Oncology, Immunology, and Neuroscience. In Cardiometabolic Health, key products include Mounjaro, Zepbound, Trulicity, and Jardiance (in collaboration with Boehringer Ingelheim). Mounjaro and Zepbound accounted for 56 percent of total revenues in 2025. Mounjaro revenue was $22.965 billion in 2025 ¹, compared to $11.540 billion in 2024 ². Zepbound revenue was $13.542 billion in 2025 ³, compared to $4.926 billion in 2024 ⁴. Trulicity revenue was $4.276 billion in 2025 ⁵, compared to $5.254 billion in 2024 ⁶. Jardiance revenue (including Glyxambi, Synjardy, and Trijardy XR) was $3.432 billion in 2025 ⁷, compared to $3.341 billion in 2024 ⁸. In Oncology, Verzenio revenue was $5.723 billion in 2025 ⁹, compared to $5.307 billion in 2024 ¹⁰. Other oncology products include Cyramza, Erbitux, Inluriyo, Jaypirca, Retevmo, and Tyvyt. In Immunology, Taltz revenue was $3.563 billion in 2025 ¹¹, compared to $3.260 billion in 2024 ¹². Other immunology products include Ebglyss, Olumiant, and Omvoh. In Neuroscience, products include Emgality and Kisunla.

Significant operational developments during the period include the acquisition of Verve Therapeutics, Inc. in July 2025 for a purchase price of $10.50 per share in cash (or an aggregate of $549 million, net of cash acquired), plus one non-tradeable contingent value right per share that entitles the holder to receive up to an additional $3.00 per share (or an aggregate of up to approximately $300 million) payable upon the achievement of a certain specified milestone ¹³. The company also acquired Scorpion Therapeutics, Inc.'s PI3Kα inhibitor program STX-478 in March 2025 for an acquired IPR&D charge of $1.412 billion ¹⁴, and SiteOne Therapeutics, Inc. in July 2025 for an acquired IPR&D charge of $494 million ¹⁵. In November 2025, Lilly announced preliminary voluntary agreements with the U.S. government to lower Medicaid and certain other drug prices for U.S. patients and to launch new medicines with a more balanced pricing approach across developed nations. The company also submitted orforglipron for regulatory review in the U.S., the EU, and Japan for the treatment of obesity, and received a Commissioner's National Priority Voucher from the FDA, which could accelerate potential U.S. approval timing.

Total revenue for 2025 was $65.179 billion ¹⁶, compared to $45.043 billion in 2024 ¹⁷, representing a 45 percent increase. Net income was $20.640 billion in 2025 ¹⁸, compared to $10.590 billion in 2024 ¹⁹, a 95 percent increase. Diluted earnings per share were $22.95 in 2025 ²⁰, compared to $11.71 in 2024 ²¹, a 96 percent increase. Revenue growth was driven primarily by increased volume, partially offset by lower realized prices, with the volume increase and lower realized prices primarily driven by Mounjaro and Zepbound. Gross margin as a percent of revenue was 83.0 percent in 2025 ²², compared to 81.3 percent in 2024 ²³. Net cash provided by operating activities was $16.813 billion in 2025 ²⁴, compared to $8.818 billion in 2024 ²⁵.

The filing states that forward-looking statements are based on management's current plans and expectations, expressed in good faith and believed to have a reasonable basis, but A primary growth vector is the continued expansion of the cardiometabolic health portfolio, particularly incretin medicines. Mounjaro and Zepbound accounted for 56 percent of total revenues in 2025 and the company expects cardiometabolic health products will continue to represent a significant and growing portion of its business, revenues, and prospects. The company submitted orforglipron for regulatory review in the U.S., the EU, and Japan for the treatment of obesity, and it was granted a Commissioner's National Priority Voucher from the FDA, which could accelerate potential U.S. approval timing. Internationally, Lilly launched Mounjaro in all major markets. As part of preliminary voluntary agreements with the U.S. government, Medicare beneficiaries will have access to discounted Lilly obesity medicines by July 1, 2026, and individual state Medicaid programs will have the option to expand access to these medicines. The company also has a license agreement with Chugai Pharmaceutical Co., Ltd for worldwide development and commercialization rights to orforglipron, with Chugai having the right to receive tiered royalty payments on future worldwide net sales from mid single digits to low teens if the product is successfully commercialized.

Another growth vector is the expansion of manufacturing capacity to support anticipated demand for current and prospective products. The company has undertaken significant manufacturing expansion initiatives, with investments to increase manufacturing capacity including new sites in North Carolina, Wisconsin, Indiana, Virginia, Texas, Alabama, Pennsylvania, Ireland, Germany, and the Netherlands. Additional capacity is expected to become operational over the next several years. The company also acquired NexPharm Parent HoldCo, LLC and Isopro Holdings, LLC in May 2024, which together own the assets of a manufacturing site in Wisconsin, for a purchase price of $925 million, net of cash acquired, to expand its global parenteral product manufacturing network. In the clinical pipeline, several product candidates are in late-stage development, including insulin efsitora alfa for type 2 diabetes (submitted in the U.S., EU, and Japan), orforglipron for obesity and type 2 diabetes, retatrutide for various indications, and lepodisiran for atherosclerotic cardiovascular disease.

Gross margin as a percent of revenue increased to 83.0 percent in 2025 ²⁶ from 81.3 percent in 2024 ²⁷, driven primarily by favorable product mix and improved cost of production, partially offset by lower realized prices. Research and development expenses increased 21 percent in 2025 ²⁸, primarily driven by continued investments in the early and late-stage portfolio. Marketing, selling, and administrative expenses increased 29 percent in 2025 ²⁹, primarily driven by promotional efforts supporting ongoing and planned launches. The effective tax rate was 19.8 percent in 2025 ³⁰ compared to 16.5 percent in 2024 ³¹, primarily driven by unfavorable impacts related to the jurisdictional mix of earnings and U.S. tax law changes in 2025 relative to 2024. The effective tax rates for both periods were unfavorably impacted by non-deductible acquired IPR&D charges, with a larger impact occurring in 2024.

Capital expenditures were $7.841 billion during 2025 ³², compared to $5.058 billion in 2024 ³³. The company is making investments in global facilities to manufacture existing and future products, which have increased capital expenditures and will result in meaningfully higher capital expenditures in the near term. As the company expands manufacturing capacity, it has entered into various agreements for contract manufacturing and for supply of materials. Executed agreements related to medicines in development could, under certain circumstances, require the company to pay up to approximately $10 billion if it does not purchase specified amounts of goods or services over the durations of the agreements, which are generally up to 8 years ³⁴. The company employed approximately 50,000 people at the end of 2025 ³⁵, including approximately 12,000 people engaged in research and development activities ³⁶.

Research and development spending was $13.337 billion in 2025 ³⁷, compared to $10.991 billion in 2024 ³⁸. Capital expenditures were $7.841 billion in 2025 ³⁹. In 2025, the company repurchased $4.1 billion of shares under its $15.0 billion share repurchase program authorized in December 2024 ⁴⁰. As of December 31, 2025, the company had $10.9 billion remaining under this program ⁴¹. Dividends of $6.00 per share were paid in 2025 ⁴², compared to $5.20 per share in 2024 ⁴³. The quarterly dividend was increased to $1.73 per share effective for the dividend to be paid in the first quarter of 2026, resulting in an indicated annual rate for 2026 of $6.92 per share ⁴⁴. Cash paid for acquisitions, net of cash acquired, was $661 million in 2025 ⁴⁵, compared to $948 million in 2024 ⁴⁶.

A key headwind is the continued intense competition and pricing pressures in the pharmaceutical industry. The company faces intensifying competition worldwide, including from China and other markets. Public and private actors continue to take aggressive steps to control expenditures for pharmaceuticals by placing restrictions on pricing and reimbursement for, and patient access to, medicines. The Inflation Reduction Act of 2022 requires HHS to effectively set prices for certain single-source drugs and biologics reimbursed under Medicare Part B and Part D. In August 2023, HHS selected Jardiance as one of the first ten medicines subject to government-set prices effective in 2026. In January 2026, HHS selected Trulicity and Verzenio as additional medicines subject to government-set prices to be effective in 2028. The company expects additional significant products will be selected in future years, which would have the effect of accelerating revenue erosion prior to expiry of exclusivities. Additionally, the company continues to see the production, marketing, and sale of counterfeit, misbranded, adulterated, and mass-compounded incretins in the U.S. and other markets, which may impact patient safety and undermine regulatory drug approval processes.

Another significant constraint is the reliance on a limited number of products for a substantial portion of revenue. Mounjaro and Zepbound accounted for 56 percent of total revenues in 2025, and the company expects cardiometabolic health products will continue to represent a significant and growing portion of its business. Factors such as loss of patent protection, changes in prescription rates, unexpected side effects or safety concerns, significant changes in demand, or competitive developments for these products could materially impact results of operations. The company also faces risks related to manufacturing and supply chain difficulties, including the significant expansion of manufacturing capabilities and reliance on third-party suppliers, including China-based suppliers for portions of the supply chain. Tariffs imposed in 2025 and potential future trade restrictions could increase costs or cause supply disruptions. The company also faces foreign currency risk exposure from fluctuating currency exchange rates, primarily the U.S. dollar against the euro, Japanese yen, Chinese yuan, and British pound sterling.

Management's message emphasizes the company's purpose to unite caring with discovery to create medicines that make life better for people around the world. The filing states that long-term success depends on the ability to continually discover or acquire, develop, and commercialize innovative medicines. Management highlights the significant financial performance in 2025, with revenue increasing 45 percent to $65.179 billion ⁴⁷, net income increasing 95 percent to $20.640 billion ⁴⁸, and diluted EPS increasing 96 percent to $22.95 ⁴⁹. The strategic priorities emphasized include: continuing to invest heavily in research and development, with $13.337 billion in R&D expenses in 2025 ⁵⁰; expanding manufacturing capacity through significant capital investments, with capital expenditures of $7.841 billion in 2025 ⁵¹; and pursuing business development activities to enhance the pipeline, including the acquisitions of Verve Therapeutics, Scorpion Therapeutics' PI3Kα inhibitor program, and SiteOne Therapeutics. Management also notes the preliminary voluntary agreements with the U.S. government to lower drug prices and expand access, and the submission of orforglipron for regulatory review. Forward-looking statements are based on management's current plans and expectations, expressed in good faith and believed to have a reasonable basis, but no specific quantitative guidance ranges are provided in the filing.

Total revenue was $65.179 billion in 2025 ⁵², compared to $45.043 billion in 2024 ⁵³. Net income was $20.640 billion in 2025 ⁵⁴, compared to $10.590 billion in 2024 ⁵⁵. Diluted earnings per share were $22.95 in 2025 ⁵⁶, compared to $11.71 in 2024 ⁵⁷. Gross margin was $54.127 billion in 2025 ⁵⁸, compared to $36.625 billion in 2024 ⁵⁹, with gross margin as a percent of revenue of 83.0 percent in 2025 ⁶⁰ compared to 81.3 percent in 2024 ⁶¹. Operating income (income before income taxes) was $25.731 billion in 2025 ⁶², compared to $12.680 billion in 2024 ⁶³. Net cash provided by operating activities was $16.813 billion in 2025 ⁶⁴, compared to $8.818 billion in 2024 ⁶⁵. Cash and cash equivalents were $7.268 billion at December 31, 2025 ⁶⁶, compared to $3.268 billion at December 31, 2024 ⁶⁷. Total debt was $42.503 billion at December 31, 2025 ⁶⁸, compared to $33.644 billion at December 31, 2024 ⁶⁹. Acquired in-process research and development charges were $2.910 billion in 2025 ⁷⁰, compared to $3.280 billion in 2024 ⁷¹, primarily related to the acquisitions of Scorpion Therapeutics' PI3Kα inhibitor program and SiteOne Therapeutics in 2025, and Morphic Holding in 2024. Asset impairment, restructuring, and other special charges were $484 million in 2025 ⁷², compared to $861 million in 2024 ⁷³, with the 2025 charges primarily related to a litigation charge and acquisition and integration costs associated with the acquisition of Verve. For segment performance, the Cardiometabolic Health segment generated total revenue of $48.221 billion in 2025 ⁷⁴, compared to $29.521 billion in 2024 ⁷⁵; the Oncology segment generated total revenue of $9.376 billion in 2025 ⁷⁶, compared to $8.753 billion in 2024 ⁷⁷; the Immunology segment generated total revenue of $5.247 billion in 2025 ⁷⁸, compared to $4.393 billion in 2024 ⁷⁹; and the Neuroscience segment generated total revenue of $1.391 billion in 2025 ⁸⁰, compared to $1.474 billion in 2024 ⁸¹.

The most material risk is the company's dependence on a few key products, with Mounjaro and Zepbound accounting for 56 percent of total revenues in 2025. Factors such as loss of patent protection, safety concerns, or competitive developments for these products could materially impact results. A second critical risk is the loss of intellectual property protection, with Trulicity set to lose significant patent and remaining data protections in the next few years, and the company facing patent challenges for many products. The Inflation Reduction Act poses a specific quantified risk, with HHS having selected Jardiance for government-set prices effective in 2026 at a 66 percent discount compared to the 2023 list price, and Trulicity and Verzenio selected for prices effective in 2028. A third risk is the intense pricing and reimbursement pressure from governments and private payers globally, including the preliminary voluntary agreements with the U.S. government to lower Medicaid and certain other drug prices. Fourth, the company faces significant manufacturing and supply chain risks, with capital expenditures of $7.841 billion in 2025 and potential obligations of up to approximately $10 billion under contract manufacturing agreements if specified amounts are not purchased. Finally, the company is subject to extensive litigation and investigations, including those related to the 340B program, pricing, and product safety, which could result in substantial charges.