Eli Lilly Freezes Salaries as Sales Slip After Best-Seller Faces Generics
Eli Lilly & Co. will freeze salaries for most employees worldwide this year, as sales of its best- selling drug declined faster than expected after losing patent protection.
John Lechleiter, Lilly’s chief executive officer, requested no increase in his $1.5 million base salary or incentives “in light of the business challenges the company faces,” the Indianapolis-based drugmaker said today in a filing. Lechleiter’s total compensation will be about $16.4 million, according to the filing.
“Similarly, employees in most countries worldwide, including the named executive officers, will not receive base pay increases in 2012,” Lilly said. No change was made in how bonuses are structured, Mark Taylor, a spokesman for the company, said in an e-mail. Lilly has an estimated 38,000 employees, according to data compiled by Bloomberg.
Last month the company provided 2012 forecasts that missed analyst estimates and said sales of its antipsychotic Zyprexa were falling faster than expected after facing generic competition beginning in October. Zyprexa revenue declined 44 percent in the fourth-quarter to $749.6 million, the company said on Jan. 31.
To contact the reporter on this story: Ryan Flinn in San Francisco at rflinn@bloomberg.net
To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net
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