Business Analysis of Eli Lilly

 Analyze Historical Performance, Strategic Priorities, And Business Improvement Opportunities of Eli Lilly

ELI LILLY

Business Overview

Eli Lilly and Company discovers, develops, manufactures, and markets pharmaceutical products worldwide. It operates through two segments, Human Pharmaceutical Products and Animal Health Products. The company offers endocrinology products to treat diabetes; osteoporosis in postmenopausal women and men; human growth hormone deficiency and pediatric growth conditions; and testosterone deficiency. It also provides neuroscience products for the treatment of depressive disorders, diabetic peripheral neuropathic pain, anxiety disorders, fibromyalgia, and chronic musculoskeletal pain; schizophrenia; attention-deficit hyperactivity disorders; depressive, obsessive-compulsive, bulimia nervosa, and panic disorders; and positron emission tomography imaging of beta-amyloid neurotic plaques in adult brains. In addition, the company offers products to treat non-small cell lung, colorectal, head and neck, pancreatic, metastatic breast, ovarian, bladder, and metastatic gastric cancers, as well as malignant pleural mesothelioma; and cardiovascular products to treat erectile dysfunction and benign prostatic hyperplasia; and migraine headaches. Further, it provides animal health products, such as cattle feed additives; protein supplements for cows; leanness and performance enhancers for swine and cattle; antibiotics to treat respiratory and other diseases in cattle, swine, and poultry; anticoccidial agents for poultry; and chewable tablets that kill fleas and prevent flea infestations, and heartworm diseases, as well as controls intestinal parasite infections. Additionally, the company offers vaccinev to prevent Lyme disease, bronchial infections, rabies, and various infectious diseases in dogs, cats, and horses. It has collaboration agreements with Daiichi Sankyo Co., Ltd., Incyte Corporation, Pfizer Inc., AstraZeneca, William Sansum Diabetes Center, Purdue University, and Nektar Therapeutics. Eli Lilly and Company was founded in 1876 and is headquartered in Indianapolis, Indiana.

Eli Lilly

Eli Lilly


R&P Rank: 126
Sector: Life Sciences
Industry:Pharmaceuticals
H.Q Location:Indiana
Website: www.lilly.com
Company Address:
LILLY CORPORATE CTR, DROP CODE 1112, INDIANAPOLIS IN 46285
Ph:317-276-2000

Business Analysis of Eli Lilly

The Life Sciences Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how Eli Lilly compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by Eli Lilly to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.

Here is the performance snapshot of Eli Lilly with an interactive chart.

  1. Revenue Growth: Eli Lilly reported a revenue growth of 6.3% year-on-year during 2016. Pharmaceuticals Industry grew at 7.7% in the same period
  2. COGS share of Revenues: As a percentage of revenue, Eli Lilly spent 26.7% of its total revenues on COGS. Pharmaceuticals industry average (COGS share of revenue) in the same period was 31.7%
  3. R&D share of Revenues: As a percentage of revenue, Eli Lilly spent 24.7% of its total revenues on R&D. Pharmaceuticals industry average R&D spending in the same period was 15.6%
  4. SG&A share of Revenues: As a percentage of revenue, Eli Lilly spent 30.4% of its total revenues on Sales, Marketing, and General Administration (SG&A). Pharmaceuticals industry average SG&A spending in the same period was 27.9%
  5. Inventory share of Revenues: As a percentage of revenue, Eli Lilly spent 16.8% of its total revenues on Inventories. Pharmaceuticals industry average Inventory spending in the same period was 13.1%
  6. Accounts Payable share of Revenues: As a percentage of revenue, Eli Lilly invested 8.9% of its total revenues on Accounts Payable (A/P) Pharmaceuticals industry average Accounts Payable investment in the same period was 12.4%
  7. Accounts Receivable share of Revenues: As a percentage of revenue, Eli Lilly invested 22.5% of its total revenues on Accounts Receivable (A/R). Pharmaceuticals industry average Accounts Receivable investment in the same period was 19.0%
  8. PP&E share of Revenues: As a percentage of revenue, Eli Lilly invested 38.9% of its total revenues on Property, Plants, and Equipments (PP&E). Pharmaceuticals industry average PPE investment in the same period was 26.2%
  9. Intangibles share of Revenues: As a percentage of revenue, Eli Lilly invested 39.3% of its total revenues on Intangibles. Pharmaceuticals industry average Intangibles investment in the same period was 161.8%
  10. Net Margins: Eli Lilly Net Margins in the year 2016 were 12.9%. Pharmaceuticals industry average Net Margins in the same period were 15.8%

Sector and Industry Association of Eli Lilly

For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.

Eli Lilly is associated with Healthcare Sector Group, Life Sciences Sector, and Pharmaceuticals Industry.

Life Sciences sector is comprised of the following industries: Pharmaceuticals; Medical Devices; Biotechnology; Diagnostics & Scientific Instruments. The definitions for each of the industries is as follows:

  • Pharmaceuticals industry includes companies that discover, develop, manufacture, and market medicines licensed for use as medications. In general these companies offer pharmaceutical products that can be described as prescription or over-the-counter medicines. Many Pharmaceutical companies also offer a diverse portfolio of animal health products, services and solutions. Many diversified pharmaceutical companies operate in more than two operating segments like consumer health products, medical devices and pharmaceutical.
  • Medical Devices industry includes manufacturers and distributors of medical equipments and medical supplies. Medical equipments include large scale capital equipmets such as X-Ray machines and MRI scanners and other nondisposable medical devices like stents and pacemakers. Medical supplies include makers of contact lenses, eyeglass lenses, bandages and other disposable products.
  • Biotechnology industry includes Biotechnology product companies, subscription companies, and service companies. Biotechnology product companies offer pharmaceutical drug products that are manufactured in, extracted from, or semi synthesized from biological sources. Subscription-based companies develop genome databases, which can be used to develop medicinal drugs. Service companies offer solutions based on a common technology or generic tool of other large pharmaceutical or biopharmaceutical companies.
  • Diagnostics & Scientific Instruments industry includes companies that provide testing products, diagnostic reagents, instruments and diagnostic services to aid in the detection and treatment of a wide range of diseases. It also includes molecular diagnostic and genetic testing companies that develop, manufacture, market and provide diagnostic tests, diagnostic systems and related products and services. Also included are companies that manufacture and market analytical instruments, equipment, reagents and consumables, software and services for research, manufacturing, analysis, discovery and diagnostics.

Industry Ranking of Eli Lilly

With $21.2 billion revenues, Eli Lilly ranked number 4 of all the companies in the US Pharmaceuticals industry. There were a total of 49 public companies in the US Pharmaceuticals industry that had revenues greater than $50 million during 2016.

The top-10 companies in the US Pharmaceuticals industry by revenues during 2016 were:

  1. J&J ($71.9 billion)
  2. Pfizer ($52.8 billion)
  3. Merck ($39.8 billion)
  4. Eli Lilly ($21.2 billion)
  5. Abbott Laboratories ($20.9 billion)
  6. Bristol Myers Squibb ($19.4 billion)
  7. Allergan ($14.6 billion)
  8. Shire ($11.4 billion)
  9. Mylan ($11.1 billion)
  10. Valeant Pharmaceuticals ($9.7 billion)

Business Model Analysis (BMA) Framework

We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.

Next Steps

  • Conduct a holistic benchmarking; to identify and target additional sources of value
  • Get in touch with us to learn more about Business Model Analysis Framework
  • Get free data, charts, and analysis of Eli Lillyand its peers on select key performance indicators by clicking the reports provided below

Industry Peers and Competitors of eli-lilly

J&J (JNJ) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Johnson & Johnson with $72 billion revenues in the year 2016 was the number 1 Pharmaceuticals company. Read this report to know the top competitors of J&J and identify growth and cost optimization opportunities of J&J

Pfizer (PFE) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Pfizer Inc with $53 billion revenues in the year 2016 was the number 2 Pharmaceuticals company. Read this report to know the top competitors of Pfizer and identify growth and cost optimization opportunities of Pfizer

Merck (MRK) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Merck & Co., Inc. with $40 billion revenues in the year 2016 was the number 3 Pharmaceuticals company. Read this report to know the top competitors of Merck and identify growth and cost optimization opportunities of Merck

Abbott Laboratories (ABT) Business Analysis – Analyze Historical Performance, Strategic Priorities,...

Abbott Laboratories with $21 billion revenues in the year 2016 was the number 5 Pharmaceuticals company. Read this report to know the top competitors of Abbott Laboratories and identify growth and cost optimization opportunities of Abbott Laboratories

Bristol Myers Squibb (BMY) Business Analysis – Analyze Historical Performance, Strategic...

Bristol Myers Squibb Co with $19 billion revenues in the year 2016 was the number 6 Pharmaceuticals company. Read this report to know the top competitors of Bristol Myers Squibb and identify growth and cost optimization opportunities of Bristol Myers Squibb

Allergan (AGN) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Allergan Plc with $15 billion revenues in the year 2016 was the number 7 Pharmaceuticals company. Read this report to know the top competitors of Allergan and identify growth and cost optimization opportunities of Allergan

Revenues Analysis

Eli Lilly (LLY) Revenues And Revenue Growth From 2012 To 2016

This report provides the last five years revenues and revenue growth of Lilly Eli & Co (LLY) from 2012 to 2016. Eli Lilly generated a total of $21.2 billion revenues during 2016. Eli Lilly reported a revenue growth of 6.3% year-over-year during 2016. The revenues and the revenue growth correspond to the fiscal year ending in December.

Eli Lilly (LLY) Revenues And Revenue Growth From 2002 To 2016

This report provides the last fifteen years revenues and revenue growth of Lilly Eli & Co (LLY) from 2002 to 2016. Eli Lilly generated a total of $21.2 billion revenues during 2016. Eli Lilly reported a revenue growth of 6.3% year-over-year during 2016. The revenues and the revenue growth correspond to the fiscal year ending in December.

Eli Lilly (LLY) Revenue Growth Comparison With Industry Growth From 2012...

This report provides a comparison of Lilly Eli & Co (LLY) revenue growth with Pharmaceuticals industry growth during the last five years from 2012 to 2016. Eli Lilly reported a revenue growth of 6.3% year-over-year during 2016. The Pharmaceuticals industry growth was 7.7% year-over-year during 2016. Eli Lilly growth was slower than the industry during 2016.