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Eli Lilly Leads Industry on Charitable Issues in New Rating Research Study

Bedminster, N.J. (9 July 2003) - Eli Lilly takes the industry lead on distributing pharmaceuticals to the economically disadvantaged, according to findings emerging from the second annual Reputation Strength Study of the pharmaceutical industry, conducted by Rating Research LLC (RRC), the leading reputation rating agency. Eli Lilly also is among the top three performers of the 19 companies studied on support of charitable causes and having a positive impact on the community.

“Eli Lilly’s strong performance on these reputation components may be partially due to the “Lilly Answers” program which provides several Lilly products to needy seniors with a deeper discount than competitors have offered,” says Dory Gasorek, Principal and RRC’s Chair, Rating Committee. “They also have garnered credit for the activities of the Eli Lilly and Company Foundation.”

Nonetheless, although charitable and social responsibility-related components emerge as beneficial in driving corporate reputation within the pharmaceutical industry, many leading companies receive little recognition for these efforts, according to the RRC study results.

“Many companies in our study provide significant monetary and drug distribution support on a global basis, but get surprisingly little credit for it,” noted Ms. Gasorek, “Given drug pricing and other issues facing the industry, pharmaceutical leaders might benefit by enhanced communication of their efforts in this regard.”

Pfizer, Merck and J&J, the only companies in the study that were assigned RRC’s highest possible AAA Reputation Strength Rating, generally perform strongly in this arena. Surprisingly, however, J&J ranks first on support of charitable causes and fifth on its positive impact on the community, but falls to tenth-place on distributing pharmaceuticals to the disadvantaged.

“This is not a major negative for J&J,” explains Ms. Gasorek. “It indicates that even top-rated companies have areas they may wish to focus on to a greater extent in the future, or simply communicate more about.”

Another example in this regard is Amgen. It ranks among the top three companies on distributing pharmaceuticals to the economically disadvantaged and having a positive impact in the community, but falls to 18th place on support of charitable causes. Bayer ranks second on having a positive impact in the community but only 17th on providing pharmaceuticals to the economically disadvantaged. Additionally, Roche Group ranks second on helping the economically disadvantaged but performs average overall on the other two components.

“This suggests opportunity areas for companies like Roche Group. Its strong performance on support of the economically disadvantaged through its “Sight and Life” program, as well as other initiatives, can be a building block to help enhance its reputation to various constituency groups,” noted Ms. Gasorek.

At the other end of the spectrum, Forest Laboratories ranks 19th place on these three reputation components, joined in the bottom of the rankings by Genentech and Bayer on distributing pharmaceuticals to the disadvantaged and Wyeth and Bristol-Myers Squibb on support of charitable causes, in addition to Amgen. On positively impacting the community, Schering-Plough and Wyeth rank only slightly above Forest, according to study results.

“Forest performs poorly as compared to the others partially due to its smaller size and more focused business lines,” noted Ms. Gasorek. “Respondents simply know less about the company overall. Forest might be wise to begin creating a more distinctive reputation across the board.”

RRC’s Reputation Strength Study included telephone interviews with senior industry executives and financial analysts in the first quarter of 2003, resulting in over 1,000 company profiles. Each company’s overall Reputation Strength Rating is based on results of primary research, the industry expertise of Rating Committee members and other information streams. RRC is a joint venture between The Ratrix Group and Opinion Research Corporation (NASDAQ: ORCI).