Ladies and gentlemen, thank you for standing by, and welcome to the Lilly Q4 2025 Earnings Conference call. At this time, all participants are in a listen-only mode. Later, we will be conducting a question-and-answer session, and instructions will be given at that time. Should you request assistance during the call, please press star, then zero, and an operator will assist you offline. I would now like to turn the conference over to your host, Mike Zappar, Senior Vice President of Investor Relations. Please go ahead.

Thank you for joining us for Eli Lilly and Company's Q4 2025 Earnings Call. I'm Mike Sappar, Senior Vice President of Investor Relations. Joining me on today's call are Dave Ricks, Lilly's Chair and CEO, Luis Montarce, Chief Financial Officer, Dr. Dan Skrivonsky, Chief Scientific and Product Officer, Adrian Brown, President of Lilly Immunology, Dr. Carol Ho, President of Lilly Neuroscience, Livia Ufo, President of Lilly USA and Global Customer Capabilities, Jake Van Narden, President of Biology and Head of Business Development, Patrick Johnson, President of Lilly International, and Ken Custer, President of Lilly Cardiometabolic Health. We're also joined by Mark Heeman, Susan Hedgeland, and Wes Tall of the Investor Relations Team. During this conference call, we anticipate making projections and forward-looking statements based on our current expectations. Our actual results could differ materially due to several factors, including those listed on slide four. Additional information concerning factors that could cause actual results to differ materially is contained in our latest Form 10-K subsequent filings with the SEC. The information we provide about our products and pipeline is for the benefit of the investment community. It is not intended to be promotional. It is not sufficient for prescribing decisions. As we transition to our prepared remarks, please note that our commentary will focus on our non-GAAP financial measures. Now, I'll turn the call over to Dave.

Thank you, Mike. 2025 was a strong year for Lilly. We delivered robust revenue growth, advanced our pipeline, expanded our manufacturing footprint, and helped over 70 million people around the world. The 2025 full-year revenue grew 45% compared to 2024, given by our key We launched new medicines like Inlurio, secured new indications for OMVO and JPRCA, and entered new markets as we completed the international rollouts of both Monjaro and Kisunla. We generated positive clinical data in more than 25 Phase III trials, including registrational trials to support two new incretins, Forglopron and Ritatriotide. We submitted Orfoglipron for obesity in the U.S. and in more than 40 countries globally. We started 14 new Phase III programs over the past few months, including Alora Lintide and Vernepatide, and we have one of the largest clinical stage pipelines in our company's We executed 39 business development transactions across all our therapeutic areas and added multiple clinical stage assets through transactions, including Scorpion, FUR, SiteOne, Adverum, and the upcoming acquisition of Ventex. We continue investing in artificial intelligence to discover and develop new medicines. In addition to our new supercomputer, we recently announced a new collaboration with NVIDIA to open a co-innovation AI lab. This project will combine Lilly's scientific expertise with NVIDIA's leading technology to accelerate drug discovery. We progressed our manufacturing expansion efforts and announced plans to build multiple new manufacturing sites in the U.S. and Europe. We increased our manufacturing capacity and began making medicine at our new sites in Wisconsin and North Carolina. We exceeded our goal to produce 1.8 times the number of incretin doses in the second half of 25 compared to the second half of 24. Since 2020, we've committed over $55 billion, the largest manufacturing build-out in company history. We announced an agreement with the US government to provide access to obesity medicines to millions of Americans with insurance through Medicare and Medicaid. We're proud of our ability to bring these important medicines to patients at a cost of only $50 per month out of pocket. The number of people engaging with our U.S. direct-to-patient platform, LilyDirect, increased to over 1 million patients in 2025. Our most popular offering, the ZepBound Self-Pay Vials, now makes up one-third of new patient starts who start on any brand of obesity medication. Lastly, we distributed $1.3 billion in dividends and $1.5 billion in share repurchases. We also strengthened our leadership team with the addition of two new executives, and I welcome both Carol Ho and Adrian Brown to this call for the first time. Now I'll turn it over to Lucas to review our Q4 results and share details on the 2026 guide.

Thanks, Dave. We deliver robust financial performance in 2025. Our full-year revenue of $65.2 billion increased by 45% compared to 2024, and earnings per share grew by 86% to $24.21.

Q4 financial performance was also strong as shown on slide 7. Revenue grew 43%

compared to Q4 2024 driven by our key products. Gross margin as a percentage of revenue was 83.2% consistent with Q4 2024. Favorable product mix and improved production costs were offset by lower realized prices. R&D expenses increased by 26 percent driven by continued investments in our early and late stage portfolio marketing selling and administrative expenses increased 29 driven by promotional efforts to support our ongoing and future launches our non-gap performance margin was 47.2 percent an increase of 4.2 percentage points compared to Q4 2024. Our effective tax rate was 19.7% and earnings per share worth $7.54, inclusive of $0.52 of acquired IPR&D charges. This compares to earnings per share of $5.32 in Q4 2024, which included $0.19 of acquired IPR&D charges. On slide 8, we quantify the effect of price, rate, and volume on revenue. U.S. revenue increased 43% in Q4, driven by volume growth of Monjaro and Zepton, partially offset by a 7% decline in price. Revenue growth was strong outside the U.S. as well, driven by double-digit volume growth in Europe, Japan, and China. In the rest of the world, volume doubled, driven by the launch of Monjaro in new markets. On slide 9, we provide an update on the performance our key products which contributed over 13 billion dollars to revenue this quarter and grew by 91% compared to Q4 2024 beginning with neuroscience Kisanla recently became the US market leader in the amyloid targeting therapy space with more than 50% share of total prescriptions revenue was a hundred and nine million dollars driven by overall market growth, increased awareness and diagnosis of Alzheimer's disease, as well as increased prescriber adoption based on Kisunla's clinical profile. In immunology, Epgles delivers solid performance in atopic dermatitis, where use total prescriptions increased 25% compared to Q3 2025. Bombo continued its uptake, and global revenue increased 55% compared to the fourth quarter in 2024. JIPIRCA posits another strong quarter of sales performance, and global sales grew 30% compared to Q4 2024. We recently received an expanded US indication to include people previously treated with a covalent DTK inhibitor, significantly increasing the number of people who can benefit from this medicine. Bersenio global sales increased 3%, driven by volume growth outside the US. Bersenio remains the market leader in its early breast cancer indication. However, overall market penetration has reached a plateau, as reflected in U.S. trends. Finally, in cardiometabolic health, Sephan and Monjaro both deliver strong results. Outside the U.S., the positive update trends of Monjaro continued, particularly in our newest launch countries in Latin America and Asia. We have launched in all major markets and are now the increased share of market leader outside the U.S. as well. Moving to the U.S., as shown on slide 10, we combined INCRED in analog market continued robust growth trajectory, with total prescriptions increasing by 33% compared to Q4 2024. As market penetration within the legible population of people with obesity is only mid-single digits. We believe there is room for market expansion and sustained market growth in the quarters and years to come. U.S. ZEPBAN revenue more than double compared to Q4 2024. ZEPBAN continues to be the market leader in the branded obesity market with nearly 70% share of new prescriptions. U.S. total prescription growth for ZEPBAN was robust both in auto injectors and vials. We are encouraged to see sustained growth uptake of CEPBAN vials, which represented approximately one-third of total CEPBAN prescriptions and nearly 50% of new CEPBAN prescriptions in Q4. In the U.S., Monjaro expanded market leadership in the Type 2 Diabetes and Retin market, exiting the quarter with over 55% of new prescriptions. On slide 11, we provide an update on capital allocation. Moving to slide 12 and 13, we share our 2026 financial guidance and highlight key factors that will impact our financial outlook. We expect revenue to be between $80 and $83 billion. The midpoint of our revenue range is an increase of 25% compared to 2025. We expect to deliver industry-leading volume growth driven by our key products, partially offset by lower realized prices. price is expected to be a drag on growth in the low to mid teens three factors will impact u.s price the government access agreement for obesity medicines updated direct to patients upon pricing and lower medicaid prices for later life cycle medicines pricing outside the u.s will be impacted by monjaro's inclusion on china national reimbursement drug list for type 2 diabetes We believe these price concessions will be more than upset by increased volume over time as we expand the number of people who can benefit from Lilly medicines. As I shared earlier, we continue to see robust growth trends in the U.S. in creating analogs market, and we expect a similar trajectory to continue in 2026. As seen with other new launches, we expect the launch of portal GLP-1s to expand the addressable market. We expect our Folkipron to launch for chronic weight management in the U.S. during the second quarter of 2026, and to launch in most international markets during 2027. We anticipate new Medicare access to obesity medicines will become effective no later than July 1, 2026. While we anticipate a reduction in Medicaid access in 2026 due to key states like California removing obesity coverage, coverage, we expect new states will add coverage for people with Medicaid in 2027. Within revenue, we anticipate Eplis, Chaipirca, Inlurio, Kizanla, and Onbo will all contribute to growth, whereas late-cycle products like Trulicity, Tulsan, Bersenio are expected to be flat or declined. We expect our non-GAAP performance margin to be between 46% and 47.5%. Across the P&L, there are pushes and pulls that we anticipate will impact our performance margin expectations. We expect gross margin will be relatively stable, to slightly down compared to Q4 2025. As favorable product mix and increased productivity are upset by price and new facilities coming online. Consistent with our strategy to invest in innovation, we expect R&D expenses will scale up in 2026. We have 36 active Phase III programs in our pipeline and plan to initiate even more new programs in 2026. With one of the largest clinical stage pipelines in company history, we are investing to maximize the impact of these potential new medicines. Marketing, selling, and administrative expenses are expected to grow as we invest to support new launches across therapeutic areas. As we launch new medicines, we will fully invest in valuable expenses while controlling fixed costs by leveraging our existing commercial footprint. We expect earnings per share of between $33.50 and $35, setting us up for another year of strong top line now and bottom line growth now I will turn the call over to Dan to highlight our progress on R&D thanks Lucas it's our last article we've

made significant progress in R&D I'll share updates by therapeutic area including select data highlights from recent phase 3 announcements a final update on key events and the potential 2020 SNCCS outcomes on which we are now focused beginning with immunology just a few weeks ago we released top line data from TOGETHER PSA, a randomized controlled phase 3B trial evaluating Ixakizumab plus terzepatide as compared to Ixakizumab alone in people with psoriatic arthritis and obesity. This first-of-its-kind study assessed whether a concomitant treatment with an incretin could deliver additional efficacy when added to an existing immunology treatment. As shown on slide 14, the combination not only achieved its primary endpoint, at least 50% reduction in psoriatic arthritis activity plus 10% weight reduction, but also showed a 64% relative increase in the proportion of patients achieving a 50% reduction in the psoriatic arthritis symptoms compared to exekizumab alone. An important finding from the study was the potential effect of terzepatide when added to exekizumab on psoriatic arthritis symptoms via both weight-dependent and also weight-independent mechanisms. These results further support existing treatment guidelines for psoriatic arthritis that recommend treatment of comorbid obesity, which shed further light on how incretins may have a positive effect on other diseases independent from weight loss. We look forward to publishing these data in more detail in a peer-reviewed journal and presenting them at an upcoming medical meeting. With this important result in hand, we are encouraged about our ongoing trial studying exekizumab and cizepatide and psoriasis. And two separate studies of mere kidney receptors epidemic in Crohn's disease and ulcerative We also advanced our new GIP-GLP1 agonist for enthetized into a Phase II study of asthma, another serious immunologic disease that we think may benefit from dual GIP-GLP1 therapy. Moving to oncology, the FDA granted full approval for protobrutinib, including the expanded indication for treatment of adults with relapsed or refractory CLL-SLL who have previously been treated with a covalent BTK inhibitor. This label update significantly increases the number of eligible patients and allows physicians to extend the use of BTK inhibitors to control disease longer. We also share detailed data from two Phase III protobritinib trials, BRUIN-CLL313 and BRUIN-CLL314. As shown on the left side of slide 15, in BRUIN-CLL313, hertobrutinib improved progression-free survival, reducing the risk of progression or death by 80% versus bendamustine plus rituximab in treatment-naive CLL-SLL patients. This risk reduction is among the most compelling ever observed for single-agent BTK inhibitor in a frontline CLL study. In the second study, shown on the right side of slide 15, grew in CLL314, protobrutinib was compared to covalent BTK inhibitor ibrutinib in treatment-naive or BTK inhibitor-naive patients. The study met the primary endpoint of non-inferiority of overall response rate. And while progression-free survival data were immature, they trended in favor of protobrutinib. Notably, in the early analysis of the treatment-naive subpopulation, as shown here, perturbrutinib reduced the risk of progression or death by 76% compared to abrutinib. Both datasets were presented at the American Society of Hematology Annual Meeting and were simultaneously published in the Journal of Clinical Oncology. We submitted these results to regulatory authorities to potentially enable the use of perturbrutinib in earlier lines of therapy. Later this year, we expect results from an additional Phase III protobrutinib trial, BRUIN-CLL-322. This trial evaluates protobrutinib in addition to a fixed-duration regimen of venetoclax and rituximab in previously treated CLL-SLL patients. If it's successful, this could form the basis for an additional regulatory submission later this year. We also presented updated combination data of imlunestrant with abemacyclin in metastatic breast cancer, which showed additional benefit compared to Imlunestrant alone. We submitted these data to regulators and are seeking to expand the Imlunestrant model. While we're encouraged by these new data for patients with metastatic breast cancer, we're even more excited about the opportunity for Imlunestrant in adjuvant breast cancer. Our ongoing 8,000-patient adjuvant breast cancer trial, EMBER4, is fully enrolled, And it will be the next Phase III readout of an oral CERD for patients with early breast cancer. In other oncology updates, we advanced Sofetibart and Epitecan, our next-generation antibody drug conjugate targeting folate receptor alpha, into Phase III testing for women with platinum-resistant ovarian cancer. We believe this program has the potential to benefit a broad population of patients with ovarian cancer, regardless of folate receptor alpha expression level. It may also offer improved tolerability compared to currently available antibody drug conjugates. We plan to initiate a study in platinum-sensitive ovarian cancer later this year. We're excited that this medicine received breakthrough therapy designation from FDA earlier this year. We also expect to initiate new Phase III programs for two other oncology models. The first is tersolizumab, a mutant selective PI3 kinase alpha inhibitor. We believe this program could represent the next generation of PI3 kinase alpha targeting agents by selectively targeting the pathway in cancerous but not in healthy cells, thus overcoming a key limitation of currently available medicines. This approach could potentially offer better disease control through deeper pathway inhibition, as well as improve tolerability. The second is Vepugratinib, an FGFR3 inhibitor that we believe may improve on the tolerability profile of existing agents and enable combination therapy in first-line metastatic urothelial carcinoma. In neuroscience, we began several trials exploring the use of incretins to treat substance use disorders in psychiatric conditions. Last quarter, we announced plans to initiate a Phase III program of bernepetide in alcohol use disorder. Since then, we've began dosing patients in this trial, and we have also launched additional bernepetide Phase II trials in tobacco use disorder and bipolar disorder. We expect to initiate several more Phase II and Phase III trials in 2026, exploring how bernepetide may be able to treat other conditions, including a Phase III trial for major depressive disorder. Testing of brinepidide can prevent relapse of disease. In Alzheimer's disease, we continue to look forward to the results from Trailblazer ALS3, our study of denanumab in people with normal cognition, but a positive blood test for Alzheimer's disease. This trial screened volunteers with a blood test for P-tau and randomized participants to a nine-month course of treatment with denanumab. By moving earlier in disease, even prior to individuals having any objective symptoms of Alzheimer's disease, The goal is to reduce the risks of them ever developing any impairment due to Alzheimer's. The primary completion is projected for 2027. However, the study will read out which the target number of progression events are accrued. Moving to cardiometabolic health, we had another busy quarter. We were excited to announce positive top-line results from the maintain-maintain trial, evaluating orforglipron for weight maintenance. this unique phase three trial was designed to answer a common question from doctors and patients can people successfully maintain weight loss achieved on maximum tolerated dose of injectable incretins by switching to an oral glp1 therapy participants in attain maintain were previously on injectable semaglutin or trisepatide then switched to orforglipron or placebo as shown on slide 16 orforglipron helped people maintain weight loss that they had achieved on injectable therapies and the study met all primary and secondary endpoints people who switch from semaglutide to orforglipron maintained their previously achieved weight loss with an average difference of just 0.9 kilograms this suggests that as an oral glp1 therapy orforglipron may provide similar weight loss maintenance with the maximum tolerated dose of the injectable glp1 therapy semaglutide as As expected, those who switch from maximum tolerated doses of the GIP GLP-1 agonist terzapatide to oral GLP-1 bodily therapy maintain much of their weight loss, although with a higher average difference of 5 kilograms. We expect to share detailed results later this year. Other Orfor-Glipron updates since our last call include submission of Orfor-Glipron to the FDA for treatment of obesity with approval expected in Q2 of this year, submission of Orphaglipron for obesity and for type 2 diabetes in a number of other countries around the world, initiation of Orphaglipron Phase 3 cardiovascular outcomes trial, and initiation of Orphaglipron Phase 3 for treatment for peripheral artery disease. We look forward to completing the U.S. regulatory submission of Orphaglipron for type 2 diabetes later this year after the Achieve 4 trial is complete. We also announced new data for our GIP GLP-1 glucagon triple agonist, retitrutide. In the first phase 3 trial to complete, TRIUMP4, we evaluated retitrutide in adults with obesity and knee osteoarthritis, which is taking retitrutide 12 milligrams, lost an average of 29% of their body weight at 68 weeks. While many people will not need this level of weight loss, we see an important potential role for molecules such as redditrutide in helping people with higher baseline BMIs or with more severe obesity-related comorbidities. Accordingly, we were pleased to see that redditrutide reduced WOMAC pain scores by an average of 4.5 points, representing a 76% reduction in pain. and this was accompanied by a significant improvement in physical function. Impressively, more than 1 in 8 redotretide treated patients were completely free from knee pain at the end of this trial. The safety profile was generally consistent with other incretins, with gastrointestinal events being most common. We observed higher discontinuation rates due to adverse events in people with lower baseline BMI, including participants who discontinued for perceived excessive weight loss. As shown on slide 17, patients with a baseline BMI of 35 or higher, which represented 84% of the trial population, had discontinuation rates due to adverse events consistent with those observed in clinical trials of other injectable anchorages. We expect to read out six additional Phase III trials for retitutide in 2026, including the remainder of the core registration package for both the TRIUMPH obesity program and the TRANSCEND type 2 diabetes program. Also in Q4, we started a Phase III trial in high-risk metabolic dysfunction-associated steatotic liver disease, MASL-D, studying raditrutide as well as truzepatide for treatment of this disease. We're planning to submit the results of the Core Triumph program in 2026 to support applications for overweight and obesity, obstructive sleep apnea, and osteoarthritis of the knee for raditrutide. Based on the data we've seen so far, depending these upcoming data readouts, we believe redditrutide may have the potential to become a treatment option for patients with significant weight loss with certain complications. Moving to terzepatide, we're pleased that ZepBound was recently approved in the U.S. in a multi-use quick pen device. This presentation of terzepatide is already available in many countries around the world as a convenient offering that includes four doses in a single pen. We look forward to launching this new ZEP bound offering in the U.S. within the next few weeks. Slide 18 shows pipeline movement since our last earnings call, and slide 19 shows the full list of key events achieved in 2025. Notably, we achieved positive outcomes for nearly all R&D key events in 2025, a rare set of results in this industry. Slide 20 shows key events expected in 2026, with potential for data readouts and regulatory actions across our therapeutic areas. In addition to the substantial progress we're making in immunology, neuroscience, and oncology, I want to take a moment to reflect on our growth of incretin and obesity portfolio. Of course, there's been a lot of focus on terzepatide and orforglipron, which I think is well warranted. Now excitement is growing for redditrutide as well. I see each of these as an example of a leading model within its own class. Behind these three Incretin innovations, we have a robust pipeline of further inventions with potential to address patient needs, including our selective amylin agonist, Alora Lintide, which is currently in Phase III, as well as our next-generation GLP-1 dual agonist, Brnepetide, which is also now in Phase III trials. behind these we have a number of earlier stage molecules that can similarly lead within new mechanisms and new classes of therapeutics for treatment of obesity we've built a substantial scientific lead in this field and we aim to widen the distance through our R&D this past year was busy and productive and we expect more of the same in 2026 as we continue to create meaningful medicines on behalf of the patients that need us.

And I'll turn the call back to Dave.

Okay, thanks, Dan.

We're pleased with all the progress in Q4 and throughout 2025. It was a year of strong execution for Lilly. We delivered exceptional business results, invested in our future, and helped millions of people around the world improve their health. Now I'll turn the call over to Mike to moderate the Q&A session.

Thanks, Dave. we'd like to take questions from as many callers as possible so consistent with our orders we will respond to one question per caller and then the call promptly at 11 if you have more than one question you can re-enter the queue and we will get your question if possible well please provide the instructions for the Q&A session and then we are ready for the first caller thank you at this

time we'll be conducting a question and answer session if you have any questions please press star 1 on your phone at this time. We ask that participants limit themselves to one question on today's call. If you do have a follow-up question, please rejoin the queue by pressing star 1 at any time. We also ask that while posing your question, you please pick up your handset if listening on speakerphone to provide optimum sound quality. Please hold while we poll for questions. And the first question today is coming from Evan Siegerman from BMO Capital Markets. Evan, your line is live.

Hi, guys. Thank you so much for taking my question. So, a year from now on this call, I'd love for you to characterize what you would ask for Orphaglipron launch. Specifically, what are some of the metrics that you're looking to meet? I know you're not going to give guidance, but some qualitative kind of commentary would be most helpful. Thank you.

Thanks for the question, Evan. Kind of a little bit, but I think you were just asking about a year from now, what are some things we'll be tracking on for Orphaglipron. So, I think for that question, maybe we'll go to Ken to maybe talk about some things that we'll be looking at.

Thanks for the question about Orphaglipron. We're really excited to have this medicine submitted not just in the U.S. but now 40 countries and looking forward to launches beginning this year. You know, as I think about success factors for us going forward maybe towards the end of the year, we'll be looking at a few things, first of which is just expansion. We're very encouraged by what we're seeing with Oral-Agovia as it validates our belief that there's a substantial number of people with overweight and obesity who've been sitting on the sidelines waiting for an oral option. It looks like these are mostly new starts. That means it's expanding the market, and that's good news for Lilly. We feel really good about the competitiveness of our profile. We've talked about that a lot on previous calls. I think we're at the point now where we're going to pivot to how do the world results play out. We think this is going to be about patient satisfaction, and our profile, which is simple with no restrictions on food and water intake, could make a big difference in the real world. So we're excited to get off to the races here, see this market expand, and really look at overall patient satisfaction scores and real-world efficacy with these agents. Thanks.

Great. Thank you, Jen. Paul, ready for the next question? The next question will be from Courtney Breen from Bernstein. Courtney, your line is live.

Hi, everyone. Everyone, thanks so much for taking the question today. Just building on the mention that you have submitted in 40 countries, traditionally you tend to think about kind of a full-year cycle for most approvals in many countries around the world. Can you just help us understand if you're anticipating any kind of accelerated pathways that you might be able to access in these ex-U.S. countries that would enable launch in 2026 for or for good products similar to some of the pathways that are available in the U.S. and you've been able to garner one of them. Thank you so much.

Great. Thanks, Courtney. And so for the question about how we're thinking about OUS, we're going to go to approval timelines. We'll go to Patrick.

Thank you very much, Courtney. As I think we shared in the prepared remarks, outside the U.S., it's mainly going to be a matter of launching the first half of 2027. There will be a few markets late 26, and a few exceptions for countries like, for example, the UAE that might reference an FDA-approved of Aglipron. So mainly up to late 26, 24, the international markets.

Thank you, Patrick. Next caller, please.

The next question will be from Chris Schott from JPMorgan. Chris, your line is live.

Great. Thanks so much for the question, and congrats on all the progress here. Can I just ask about international Manjaro? This seemed like this was a very significant upside driver, at least relative to street numbers, in 2025. And I'm just interested in your thoughts on the ramp from here as we think about the 3.3 billion 4Q results you just reported. I know last year was about a lot of new market launches, and now you're in those markets. It's like, how do we think about kind of sequential growth from these levels? Thank you.

Great. Thank you, Chris. With a question on OUS Manjaro performance and the rant from here, we'll go back to Patrick.

Thank you very much, Chris. Well, you are right. Q4 was a very strong quarter for Manjaro also outside the U.S., and as Lucas referred to, we became the shadow market leader for total increase also internationally. When you look at 2026, I would just reflect back on 25. we had major launches more or less in every quarter, with the exception of Q4. So I would actually look forward as a base for the 2026 growth, but also consider that there was a slight impact in Q4 driven by the NRDL listing in China, effective 1-1-2026, which slightly impacts the purchasing pattern in China in December. So see Q4 as a base for 2025, the 2026. Moving forward, our business now over the U.S. is 75% chronic weight management, and that's pretty much out of pocket. 25% is reimbursed for type 2 diabetes. So the priorities for 2026 will pretty much be market expansion, driving more penetration through patient activation when it comes to chronic weight management. And for type 2, we are leaning in to gain reimbursement in more countries. We're currently reimbursed in nine, with the last one being China, with the NRDL. And we will do that with a maintained discipline in terms of pricing. So I think overall we're well positioned for a continued growth for Monjaro outside the U.S. in 2026.

Thanks, Patrick. Patrick, next question, please, Paul.

The next question will be from Seamus Fernandez from Guggenheim. Seamus, your line is live.

Thanks so much for the question. And so I'm actually going to ask a non-obesity question. So while you can't take your eye off the ball on obesity, just wondering why you couldn't attack immunology broadly in the same way as you have obesity, investing earlier, faster, and more aggressively given the substantial cat generation that we're starting to see from the overall portfolio. What are the issues that would prevent you from doing something like this, whether it be by your internal efforts or perhaps a more aggressive business development approach, just because it seems like this is a, you know, sort of cash-driven opportunity where there's a lot of spend, but a huge amount of upside opportunity with $170 billion of total market out there to access?

Great. Thanks, Seamus, and extra credit for the non-obesity question. We'll go to Dan to talk about our approaches on attacking immunology early.

Thanks, Seamus. It's a great question. And actually, I'll come to immunology in a second, but let me just first point out that across our non-obesity work, which is, of course, oncology, neuroscience, and immunology, we have our thumb on the scale for investment decisions. We see lots of good opportunities in those areas, and we're reinvesting some of the proceeds from the obesity opportunity to make sure we can further accelerate growth in those promising areas. Today you heard me talk a lot about the oncology portfolio, which I think is really blossoming right now. I have high hopes for immunology behind it. I think there's really promising, breaking science, including treating immunologic diseases earlier. And our research labs are doing everything in our power to harness that science. Today I talked a little bit about some trials that are ongoing for incretins in immunology, which I think is promising as are a number of other combination therapies that we now have in our late-stage clinical trials. So I'm excited both early and late when we get to immunology.

Great. Thank you, Dan. Next caller, Paul.

The next question will be from Terrence Flynn from Morgan Stanley. Tyrone, your line is live.

Great. Congrats on the quarter. I had a question on the guidance high level, Lucas, just wondering if you can talk about what's embedded for Medicare volume ramp in the back half of the year and how that might drive the range we're seeing on the revenue side, and then if that's had any impact on employer opt-ins on the commercial side. I know you guys previously talked about how that might have some impact to get some of the other employers over the hurdle on coverage. So just wondering if you're starting to see that yet.

Thanks, Terrence, for the question on guidance and kind of Medicare ramp in the back half of the year, as well as if there's any commercial opt-in, we'll go to Lucas.

Yeah, Terrence, thank you for the question. Maybe starting with Medicare, as highlighted in the context, basically, we are expecting that access to be granted no later than July 1st, and as I mentioned all along, this will take time to build over time, but we feel very, very positive about the opportunity to bring anti-obesity medications to patients in Medicare. As I mentioned, again, the co-paid $50 for the patients would be a compelling value proposition as well. There is a bolus of patients that we have nowadays in the direct business that we believe are also Medicare patients. So expect that BOLUS, I think, is between 10% to 20% will actually move into the Medicare space. I think that will happen relatively fast, and we will continue to build on top of that. So that's kind of the driver start to think about, again, the penetration. But we'll build over time. We think about, again, more about the size of the opportunity in Medicare, thinking about 2027 as well uh the second part of your question was about the employer obtain i have ilia right next to me here as well to talk about it but as as all along you said of course again the practice on physicians prescribing this medicine will become more natural more broader in the anti-obesity medications and physicians will be again more broadly basically also thinking about prescribing this in commercial how that will then impact the employer's side i think the message is clear right Again, there is a clear recognition of the class as a chronic disease, and basically that will, in my eyes, will propel also employers also to think about, again, this class and also employees to look for this class of medicines as well to be covered as well. But I don't know if it's anything else that you would like to add, Ilya.

Yeah, maybe just some additional context, Terrence, on commercial opt-in. Obviously, we start the year roughly on balance, relatively stable. There are some employers adding coverage, some removing some coverage, but we're putting additional focus in the employer space. We've stood up a team and also working with a number of third parties to actually provide alternative access channels to have some flexibility in design, transparency in the pricing, and the initial conversations and feedback has been positive. Of course, a lot of those decisions are for the following year. We anticipate having some of those decisions and increased coverage over time in the employer space as we head into the back end of this year and mostly into 2027.

Great. Thanks, Lucas. Nilia, next question please, Paul.

The next question will be from Jeff Meacham from Citi. Jeff, your line is live.

Great. Morning, everyone. Thanks for the question. Congrats on the quarter. Dan, I have one for you. The together results are really super interesting. How do you think about the potential for combo therapies with ZetBound and either INI or oncology or neuro? I wasn't sure, you know, what drives the investment priorities, whether it's the drug or the indication, and if there's a clear path to a labeling claim. Thank you.

Yeah, thanks, Jeff. Again, another non-abucity question, so lots of extra credit on this call. We'll go to Adrian to talk about some of the combination therapy approaches and some of the strategy there.

Sure. Sure. We see this as a significant opportunity. Obviously, you know, more than a billion people worldwide have immune diseases like atopic dermatitis, psoriasis, IBD, and asthma. But patients who have both immune diseases and obesity tend to have a higher disease burden. So we're really excited about the opportunity to find new ways to combat the underlying implementation of these diseases and potentially unlock better, longer-lasting results for these patients. So we have, you know, broad efforts underway to look at additional combinations. We have the TOGETHER PSO trial evaluating the use of TALT and Z-Bound for adults with moderate to severe plaque psoriasis and obesity or overweight. We expect those top-line results in the first half of 2026. We're also looking at the TOGETHER Amplified PSA and TOGETHER Amplified PSO studies assessing the effectiveness of adding ZEP bound after starting TALT for adults with PSA and moderate to severe plaque psoriasis. We also have the Phase 3B commit studies in both ulcerative colitis as well as Crohn's disease, where we're looking at the concomitant use of OMVO and ZEP bound and addressing outcomes for those patients. And then the Phase 2 study of brinephitide for people living with uncontrolled asthma. So we're excited to continue to pursue the applications of incretins and unlocking better outcomes for people with immune diseases.

Great. Thanks, Adrian. Next question. Next caller, Paul?

The next question will be from Asad Haider from Goldman Sachs. Asad, your line is live.

Great. Thanks for taking the question, and congrats on all the progress. Back to obesity, with apologies, Mike. Maybe just given the focus on pricing dynamics, can you just talk about what you're seeing in the contracting environment broadly speaking across the infinite portfolio? And also what's your view on price elasticity in the cash channel as the year progresses?

All right. Asad, thanks for the question. To go through kind of pricing in the U.S. and price elasticity, we'll go to Ilya.

Yeah, sure. Thanks for the question. Maybe just for the first part in terms of the commercial access and contracting, obviously we start the year with similar coverage as we ended 2025. We continue to have coverage for ZetBound in two of the three large PBMs. We continue the conversations around expanding access in those PBMs for, obviously, the introduction of Orfaglipron in Q2, so we're in active discussions there. From a pricing standpoint, we've been pretty transparent on pricing for 2026 as it relates to Part D as well as our direct to patient pricing which we implemented at the end of December and then we have ongoing conversations with improving and continuing access in the commercial segment. In terms of price elasticity we've seen over time both in the U.S. and outside of the U.S. that affordability and opportunity on the entry as well as predictability of cost for patients matter. That's why the out-of-pocket in Part D of $50 is an affordable option, as well as we've seen an increase in utilization of even ZEP-bound vial at the end of the year when we implemented improved entry price of $299 for ZEP-bound. So we continue to see that, and obviously we're seeing significant and encouraging uptake in the oral market, which is expansive, and bringing new patients to obesity treatment. And we're excited to launch Orfraglipron soon with the entry price being similar to oral SEMA.

Great. Thank you, Ilya. Ready for the next question, please, Paul.

The next question will be from Mohit Pansal from Wells Fargo. Mohit, your line is live.

Great. Thank you very much for taking my question. So, a strategic one. So, I would love to understand what is your latest thinking on the importance of getting obesity-related indications on the label because we kind of get the mixed message, a little bit of mixed message when we talk to payers because they kind of think that these drugs are just for obesity for now. with NASH, they're still coming for obesity, you know, with NASH, but do you think this could be an overtime long-term differentiator here now that you are going into indications like INI at this point? Thank you.

Thanks for the question, Mohit. So, to kind of think about and address our strategy on obesity and expansion of indications more broadly, we'll go to Ilya to go, and then Ken, you can add if you have any other development bugs.

Thanks, Mohi, for the question. You know, what we've seen thus far, even with ZepBound and looking at Medicare population around sleep apnea, we're seeing an increase in utilization and thinking about obesity beyond weight and looking at outcomes related to obesity and a lot of comorbidities, as Dan had mentioned, even in our arthritis trial with HALTS, when we talk to employers as well as payers, they think about the multiple aspects of obesity and what that means for coverage and cost long-term. So we do see a growing body of evidence to support covering obesity medications for population and having a positive impact to public health beyond just weight.

Thanks for the question on other potential avenues of X4 as it relates to complications and comorbidities. As our incretin portfolio and amylin portfolio expands, we're always facing the question of do we spend our resources replicating findings from previous incretins on comorbidities and complications where we know these drugs are efficacious or do we push into new areas and generate new evidence? You've probably seen with Orphaglipron, we're actually starting to explore new ideas like stress urinary incontinence, peripheral artery disease, and hypertension. We'll continue to look for new wish incretins in addition to what we've talked about in the INI space. But we do also understand that with new molecules and new mechanisms, it's important to generate some data to continue to give prescribers and patients confidence that these medicines preserve the benefits of the previous class of medicines. So we continue to do that too, but very pleased, I think, with our overall balance of investment across the Incurten portfolio in both sort of established and emerging mechanisms of

interest or diseases of interest. Great. Thank you both. We're in for the next question, please, Paul.

The next question will be from Umair Rafat from Evercore. Umair, your line is live.

Thank you, guys. Cash pay, I feel like, has been a very important driver of growth among other drivers. And I'm just trying to think out loud what the long-term implications of that could look like, especially with all the competition coming. On the one side, obviously, there's be tremendous brand loyalty which is very important in cash pay but on the other side the traditional pvm contracts and rebate wall may not apply so i'm just trying to think out loud how you're thinking about share retention and cash pay in the long run thank you okay thanks for

the question umer uh to discuss a bit about sort of the cash pay dynamics i'll ask actually uh ilya and patrick to discuss how it plays out internationally and what is well in the u.s so And Patrick, do you want to start first?

You know, I think what we have been building over the last couple of years, learning a lot from the U.S., has really been the consumer centricity. And I think it's a matter of building platforms along the lines as we've done in the U.S., we've really direct, where we're providing the opportunity for patients both to seek, start, and to stay. So I think that's a matter that we need to continue to develop.

Yeah, just to add on, I think we've learned quite a bit. there are frictions in the system for a number of diseases in the US and globally obviously we've seen that happen in obesity what we've built within Lily direct as a pretty significant scaled direct-to-consumer platform that helps address some of the frictions of course we can continue to think about how we evolve that consumer experience and make this more seamless at the same top growing access across the different segments and so both will play an important role and we continue to look for ways for us to scale as well as improve on the experience over time. Okay thanks both for the comments. Let's go to

the next question please Paul. The next question will be from Alex Hammond from Wolf Research. Alex your line is live. Hey guys thanks for taking the question. One

on all our lintides. So the weight loss results you guys presented last year look really strong. But given prescribers and patients seem more interested in more favorable tolerability, how should you think about the potential for lower doses of Allura and lower dose combos of trizapatide to potentially achieve a titration-free placebo-like tolerability with weight loss, let's say comparable to monotherapy GLP-1? Thank you.

Thanks, Alex. We'll go to Ken to talk about the Allura-Lintide development strategies and different ideas we're assessing. Yeah, thanks for the question, Alex,

on aloralintide in future avenues. We were really excited about the data we shared in obesity last week where patients achieved up to 20.1% weight loss with aloralintide with excellent tolerability that was improved with titration. In fact, in the 3, 6, 9 milligram titration group, I think we only had one incidence of vomiting out of more than 50 patients. So that compares, we think, really favorable versus the existing incretin class. So we see a big opportunity for aloralintide in patients who maybe just can't tolerate an incretin. We know that 5 to 10 percent of patients in our trials tend to discontinue on the Incretin class, suggesting a pretty big opening given the size of the Bucity market. Of course, we're also interested in thinking about Olurlentine in combination with other mechanisms of action and what you alluded to with GIP plus GLP-1 plus amylin is a very sort of physiological construct, three nutrient-stimulated hormones. And we've shared that we are exploring that idea in the clinic, nothing to share yet, but stay tuned maybe towards the end of this year. We're testing other possible combinations including the GIP agonist macufatide as well and so really just trying to understand the range of options and like you said is there really an optimal very simple permutation of mechanisms that can allow minimal or no titration with competitive efficacy. Thank you Ken. Paul ready for

the next question please. The next question will be from James Shin from Deutsche Bank. James, your line is live.

Thanks, guys. Hey, good morning. One for David. For CMS's upcoming obesity demonstration, David, can you share any similarities or differences you foresee from what you went through previously during the Part D senior savings model for insulin's $35 copay rollout? Thank you.

Great. Thanks, James. And I will welcome Dave to get in the box score for the Q&A. Okay. Can you share any similarities on the CMS obesity pilot versus the Part D senior savings?

Yeah, I mean, I think there are quite a number of analogies to draw. I mean, first, arriving at what would be perceived as a relatively low out-of-pocket is an important fact by itself. And while we know in this case, we're not moving from high out-of-pocket to low only, moving from covered plus low out-of-pocket. And I think patients who may be using GLP-1, and the data we have is that seniors are using these drugs at a lower rate than the general population, maybe because income in particular will benefit from that lower cost every month of $50. I think that's very expansionary to the class, and will draw a lot of interest from primary care prescribers who are concerned about the comorbidities of kind of lifetime, overweight, and obesity, which tend to manifest after 65 at a much higher rate. The second thing is the consistent variance. And I think when we negotiated this with the government, we wanted to make sure that we weren't just building a program that went into the normal Part D math in terms of out-of-pocket costs, but had kind of that consistency. Independent of the absolute amount people pay, they get very frustrated with different amounts month to month. So I think that's another important feature. Thirdly, like the insulin deal, it's open to all innovators, and I think that's an important concept that the doctor and the patient choose the best therapy, which could be one from us, one from our competitor. It could be oral. It could be injectable. It could include future therapies from Lilly or others, like retatratide or aloralintide when they're approved. So I think that also has a parallel to what we did with insulin. If you look back at that insulin pilot, utilization rates increased pretty dramatically in Part D, and frustration levels with that issue basically disappeared. I think this program has a similar promise to be both enormously popular, drive a lot of new uptake. As I said, it's suppressed in the senior population, who could probably benefit most, at least in the short term, from GLP-1 therapy. And I believe, and I know that CMS does as well, that within a few years we'll demonstrate significant cost savings to the Medicare program. So that is different than the insulin part, but that's associated with, you know, new products being added. So we're excited to get going. We expect this to be effective by July 1. Working through the details with the administration now, and you'll hear more maybe on our Q1 call.

Thank you, Dave. Ready for the next question, please, Paul?

The next question will be from Steve Scala from TD Count. Steve, your line is live.

Thank you so much. 2026 revenue guidance is $15 to $20 billion higher than that delivered in 2025. Munjaro and Zeppown are doing great, but we can kind of see their trajectory. Are there scenarios where these incremental sales can be delivered without with 4-gill-pound being a $5 billion product in 2026? And does the guidance tell us that Lilly believes orals will grow the market and not cannibalize? Thank you.

Great. Thanks, Steve, for the great questions as always. We'll go to Lucas to talk a bit about the revenue guide and some of the moving parts that are contained within that.

Yeah, thank you for the question, Steve. Thinking about the guide, again, you can do the math on that perspective, But when we think about the process, maybe start from there, as always, we do a bottom-up approach on what we see in the marketplace and then across all the therapeutic areas and geographies as well. And we have, again, a point of the guide as kind of what is our goal for the year to start with. There are many multiples pushes and pulls, and I described that during the context as well, talking about, again, the expansion in Medicare that they've just covered, talking about the launch of Orpho-Glupron as well, and a continuation of growth that we expect to see both in the U.S. and our U.S. markets. I think it's fair to go back as well about basically the price component as well that is embedded into the guide as well. That's another component that is going to be actually accelerated in 2026, that erosion versus 2025, and I call out basically low to mid-teens. That's a new component to basically some of the math that you were thinking about 2025 that you need to factor as when you're doing those forecasting and models that you described. In terms of your folglopron question, I think it's important to highlight looking at even and just the last four weeks of the data of the competitor launch is mainly expansion of the market. So we are very, very encouraged from, again, the first month of seeing that data, and it's very much consistent with our expectations and our guide. We will see how much, again, that class will continue to grow over the years, and we will update our guide throughout the year depending on that.

Great. Thanks, Lucas. We have time for a couple quick ones. So if we can do the next question, please, Paul.

The next question will be from Akash Tawari from Jefferies. Akash, your line is live.

Hey, thanks so much. So Dave, you've mentioned that investors are really understand, really recognize it's a consumer stock. Can you talk about some consumer analogs you'd point investors towards when you're thinking about long-term penetration for both the US and ex-US for your weight loss product? And then maybe just on the cannibalization point, is it fair to say your guide isn't expecting meaningful cannibalization of the oral and injectable obesity products versus what we've seen with Novo.

Definitely a two-parter there, Kosh. So we'll get Dave to talk about more analogs.

Well, you know, I think Luke has covered the cannibalization, but it's not what we're seeing right now, nor is what we really expect. In a way, though, just strategically, it doesn't really matter to us. I think we're interested in having people on the medicine that they think and our doctor think is best for them. And if it comes from Billy, that's our goal. So we're not too concerned about that, but I don't actually expect a ton of cannibalization, to be honest. In terms of consumer analogs, it's a difficult question. I'd be open to your feedback on this. We spent a lot of time modeling out the trajectory of the out-of-pocket business. Patrick and Ilya commented on that. I think at the JPMorgan conference I spoke about this. I think it is a bit of a wild card in our short and midterm outlook because I am hard-pressed to think of an analog where you have this many people paying out of pocket for a prescription medication. People can look back at the PDE wars and the ED drugs. We were part of that. We've learned some things from that, but it's not the same as this. You can look at cosmetics and aesthetics where it's quite common, but that also has some overlap, but not complete because here you have, you know, really profound health benefits and, you know, noticeable results that really drives a success cycle for people in their lives. It's kind of different. So I think it's hard for us to think about that. What we can do is take learnings from other industries that were able to reduce consumer friction, unlock the power of first-party data and marketing, consider, you know, a platform and an interface with consumers that allows us to bring our really robust and deep pipeline that Ken's been talking about, you know, to market in a way that might be quite differentiated over time, play with pricing opportunities, subscription models, these kinds of things. All that is in our future, and I think Lily Direct, direct discussion, out-of-pocket business all enables those things. It's pretty interesting strategically because I don't think there's a good analog in our industry, and we're working through that and excited by the potential. As we already see, you know, a million people in the U.S., hundreds of thousands more outside the U.S., choosing this way to buy a medicine like that found in Manjaro.

Great. Thanks, Dave. I will do one last question, and then we'll have to close the call.

Okay. Final question today is coming from Michael Yee from UBS. Michael, your line is live.

Thank you, just wanted to ask your expectation on the Orpho launch general view of unit volume scripts vis-à-vis the Terzepatide launch and how you think either access or other channels are different here versus Terzepatide and how you think about the launch here versus Terzepatide for Orpho.

Okay, thanks. Mike, we'll go to Ilya to talk a bit about the Orpho launch.

Yeah, thanks for the question. Obviously, we're excited about launching, or for Glipron, assuming in Q2, you know, as we think about the overall market in every launch in this space, you're launching in a larger market and more greater consumer and provider awareness. We recognize that, and we look for learning from how we've launched previously. I think what's different here, and people on the call have discussed this, is that there is a typically in the cycle of launches you start with access build access over time and you see gradual uptake what we've seen in this space in particular and obviously we have a scale direct-to-consumer platform as part of that you also have a significant self pay and consumer awareness in this category and so our expectations are high in terms of what we expect for or for gliprod in our launch and we again we expect this to be market expansive and bring new people to therapy for obesity so that's our expectation for gliprod

over time thanks oh yeah Dave over to you for the close hey well as always we appreciate your participation in today's earnings call and of course your interest in Eli Lilly and company please follow up with the IR team if you have any questions that we did not address today and otherwise have a great rest

your day. Take care. Thank you. And ladies and gentlemen, this does conclude our conference for today. This conference will be made available for replay beginning at 1 p.m. today, running through March 10th at midnight. You may access the replay system at any time by dialing 800-332-6854 and entering the access code 331160. International dialers can call 973-528-0005. Again, those Those numbers are 800-332-6854-973-528-0005 with the access code 331160. Thank you for your participation. You may now disconnect your lines.