Eli Lilly was born in
Baltimore,
Maryland in
1838. In
1854 he moved to
Lafayette,
Indiana, to live with his aunt and uncle and learn a trade. He took up an apprenticeship at
Good Samaritan Drug Store. He would spend nearly five years as an
apprentice there. In
1860 he opened his own drug store. However soon war called.
Eli Lilly was appointed by the governor of
Indiana to recruit, organize, and lead
the 18th Indiana Battery of Light Artillery despite the fact that his only military experience was as a member of a
militia unit (I guess having connections is a good thing). On August 20, 1862 the battery was mustered into service under the command of Captain Eli Lilly. Military life turned out to be a bit more than Lilly bargained for. He later remarked that he lived on
whiskey,
quinine, and
tobacco while in the service. Lilly's Brigade, participated in the following campaigns during the civil war:
Kentucky 1862
Roscrans' Campaign in Tennessee 1863
East Tennessee 1863–
1864
Against Atlanta 1864
Pursuit of Hood 1864
Wilson's Raid through Alabama and Georgia 1864–
1865
Tennessee 1865
However Lilly himself was not with the battery for the latter half of their campaigns. You see, in the winter of 1863 Lilly left the battery to accept a colonel's appointment in the
cavalry. He and his cavalry were captured and later paroled by
General Forrest at
Sulphur Trestle in
Alabama.
After returning to civilian life Eli Lilly acquired a
laboratory on Pearl Street in
Indianapolis, Indiana in
1876 and started Eli Lilly and Company with $1,400 in capital.
Lilly was frustrated by the poorly prepared, often ineffective medicines of his time. Consequently, he made the commitment to develop only medicines that would be dispensed at the suggestion of physicians rather than by
eloquent sideshow hucksters of his time.
Lily’s desire to innovate led him to hire a young chemist to function as a full-time
research scientist in
1886. This commitment to research has paid his company rich dividends. For instance, the innovative process of
gelatin-coating pills helped establish the success of the company.
Eli Lilly also began his family’s long history of
philanthropy. In
1893 he chaired a committee to help
indigents during that year's financial panic. His "Indianapolis plan of relief" (
1894) became a model for helping the unemployed. He also donated money to build a children's hospital.
After his death in 1898 Colonel Lilly's son, Josiah K. Lilly Sr., and two grandsons, Eli Lilly and Josiah K. Lilly Jr., each served as president of the company.
In
1919,
biochemist George Henry Alexander Clowes was hired as director of biochemical research at Eli Lilly and Company. Clowes' negotiations with researchers who developed
insulin at the
University of Toronto helped launch the first successful large-scale production of
insulin in
1923. The success of insulin enabled the company to attract well-respected scientists and, with them, make more medical advances.
In
1937 three members of the Lilly family (J.K. Lilly Sr. and his two sons, J.K. Jr. and Eli), founded the Lilly Endowment as a way to retain control of Eli Lilly and Company, decrease income and
inheritance taxes and continue and expand the family’s charitable gifts. The Endowment was started through gifts of stock in Eli Lilly and Company valued at $280,000.
World War II brought production at Eli Lilly and Company to a new high with the manufacturing of
Merthiolate and
blood plasma. In
1943, full-scale production of
penicillin began.
In
1948 J. K. Lilly Sr. died and willed an additional $30 million of company stock to the Lilly Endowment.
In 1952, the first public shares of stock in Eli Lilly and Company were offered.
In 1953, Eugene N. Beesley was named president. He was the first non-family member to run the company.
The drug company was in the forefront in manufacturing the
Salk polio vaccine in
1955.
Through all this time the value of the stock in the Lilly Endowment had been growing.
The 1969 Tax Reform Act caused the endowment to increase its grant pay-outs. According to this act, all foundations are required to pay either five percent of their
assets or
income, whichever is greater. Therefore, the Endowment’s giving rose from about, $9 million in the late 1960s to over $50 million by the mid-1970s.
Richard Wood was named CEO of Lilly in 1973. During the 1970s and 1980s, Eli Lilly &. Co. saw a flurry of drug production: the
antibiotic Keflex in 1971; the heart drug
Dobutrex in 1977;
Ceclor - which would become the world's top selling
oral antibiotic - in 1979; a
leukemia drug
Eldisine; the
antiarthritic Oraflex; and the
analgesic Darvon.
Not every Lilly venture was successful.
Oraflex, the American version of
Benoxaprofen, was withdrawn from the market in 1982 - just one month after gaining
FDA approval. A British medical journal found five cases of death due to
jaundice in patients taking the drug and the
FDA accused Lilly of suppressing
unfavorable research findings. In 1985, the U.S. Justice Department filed criminal charges against the company. Lilly pleaded guilty to 25 criminal counts and paid a $25,000 fine.
Also in 1982 Eli Lilly launched
Humulin, making it the first company to market a
genetically engineered product.
In 1985, the controversial
antidepressant drug
Prozac was marketed in
Belgium, and in 1988 it was introduced in the United States. By 1999 sales of
Prozac exceeded $28 billion.
In 1991, Vaughn Bryson was named CEO. During his 18-month tenure, the company reported its first quarterly loss ever. Randall Tobias, former vice-chairman of AT&T, was named Bryson's replacement in 1993. He was the first official recruited outside of the company.
In 1998, the Lilly Endowment became the wealthiest private charitable foundation in the United States with approximately $3 billion more in assets than the
Ford Foundation which previously ranked as the largest for more than thirty years.
Sidney Taurel, former chief operating officer of Lilly was named CEO in 1998, replacing Tobias. Taurel was named chairman in January 1999.
Lilly won approval to sell the bone-strengthening drug
Evista in October 1999 to treat
osteoporosis in
postmenopausal women.
In March 2000, the U.S. Food and Drug Administration approved
Zyprexa for the short-term treatment of acute
manic episodes associated with
bipolar disorder.
In August 2000, the U.S. Court of Appeals ruled that a generic drug company could begin making
a Prozac substitute nearly three years earlier than planned. The ruling, which shortened Lilly's patent protection on
Prozac from December 2003 to Feb. 2 of 2001 (later extended to Aug. 2, 2001), was a financial blow because Lilly was deriving one quarter of its sales from
Prozac.
Eli Lilly and Company employs more than 35,000 people worldwide and markets medicines in 159 countries. It had net sales of about $10,862,200,000 and net income of about $3,057,800,000 in the year ending 2000-12-31.
The Lilly Endowment remained the wealthiest private charitable foundation in the United States with assets of $15,591,737,808 in the year ending 2000-12-31. The Endowment made grants totaling $583,890,521 in the year ending 2000-12-31.