October 8, 2008

Lilly Resolves Multi-State Investigation of Zyprexa

Eli Lilly and Company has resolved a multi-state investigation involving 32 states and the District of Columbia related to the sales, marketing and promotion of its antipsychotic medication Zyprexa.

While there is no finding that Lilly has violated any provision of the state laws under which the investigations were conducted, the company said that it will pay $62 million to be divided among the settling states. This payment will result in a charge in the third quarter of $0.04 per share.

In addition, Lilly will undertake certain commitments regarding Zyprexa for a period of six years following the agreement via consent decrees filed in the various states. These commitments relate to the company's promotional practices, dissemination of medical information, funding of continuing medical education and grants related to Zyprexa, and continued disclosure of Zyprexa clinical trials and their results.

Lilly would also agree to provide signatory attorneys general with information related to compensation made to healthcare professionals who have received more than $100 annually from the company for promotional speaking or consulting regarding Zyprexa in the US.

The 32 states participating in the agreement are Alabama, Arizona, California, Delaware, Florida, Hawaii, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Missouri, Nebraska, Nevada, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Texas, Vermont, Washington and Wisconsin, as well as the District of Columbia.

Eleven other states (Louisiana, Mississippi, Montana, New Mexico, Pennsylvania, South Carolina, Utah, West Virginia, Connecticut, Arkansas and Idaho) have filed lawsuits over Zyprexa and are not covered by this agreement.

Zyprexa is indicated in the US for the short- and long-term treatment of schizophrenia, acute mixed or manic episodes of bipolar I disorder, and maintenance treatment of bipolar disorder.

Robert Armitage, Lilly's senior vice president and general counsel, said: "We believe all of the parties involved share an interest in putting this dispute behind us. From our standpoint, it's certainly in the best interests of the company and the patients, care-givers and healthcare professionals who continue to rely on this life-saving medication."