June 19 Drugmaker Eli Lilly and Co,
which faces revenue pressure from patent expirations of top
products, said it was resuming its program to buy back its
The Indianapolis-based company had not bought back its
shares since 2006, choosing to use its cash for other purposes.
Lilly's board authorized the company to resume a share
repurchase program that had begun in 2000, under which it had
spent $2.58 billion of a total authorization of $3 billion.
Lilly said it expects to buy the remaining $420 million by
the end of the year - which equates to about 1 percent of
outstanding shares, according to ISI Group analyst Mark
Schoenebaum - and anticipates resuming share repurchases
following the completion of the current program.
Lilly Chief Executive Officer John Lechleiter said in a
statement that based on current market valuations and the
company's confidence in its prospects, it was an "excellent
opportunity to resume buying back Lilly shares even as we
maintain the dividend at least at its current level."
Lilly is coping with the patent expiration of its one-time
top-selling medicine, anti-psychotic Zyprexa, which is now
seeing fierce competition from low-cost generic versions. It
also faces the loss of exclusivity of antidepressant Cymbalta
Data is expected soon on Lilly's experimental Alzheimer's
treatment, which is considered a long shot to succeed but could
drive the shares significantly higher should it work.
Lilly shares were up 1 percent at $42.45 on Tuesday morning
on the New York Stock Exchange.