-Indy Star

04/07/2008 - Eli Lilly and Co.'s storied history was on full display last week as Sidney Taurel, a career Lilly man, retired as chief executive and was replaced by John Lechleiter, another career Lilly man.

One of the gifts presented to Taurel during his sendoff March 31 at Lilly's Downtown Indianapolis headquarters was an engraved letter opener given to executives in 1926 to mark the company's 50th anniversary.

Lechleiter, 54, in his remarks to Taurel, 59, said the letter opener was one of only two remaining in the company's possession.

In his remarks, Taurel -- whose CEO tenure began in 1998 -- talked about how Lilly had survived one of its most challenging periods with the unexpected loss of the Prozac patent in 2001.

He also looked further back. "I've had 37 years of great fortune and challenges," said Taurel, who will remain as chairman through the end of 2008.

After the ceremony, Lechleiter walked from Lilly's main cafeteria to the company's private museum to conduct an interview with a reporter. He pointed out a large sculpture, modeled after a historic photo, of a mother holding her Type 1 diabetic child saved by insulin. In 1923, Lilly produced the first commercially available insulin product.

He returned to the present.

"The guidance that Sidney has always given us as leaders, and certainly reinforced in his remarks this afternoon, is the first principle of leadership is to be guided by a set of values," said Lechleiter, a career scientist who joined Lilly in 1979. "It's never been more important in our history that what we call our values -- respect for people, integrity and excellence -- be lived out in this company, be manifestly clear to the people who depend on our medicines, to our customers, our business partners.

"It's advice I intend to pass on someday to my successor."

In modern corporate America, however, defining history and legacies can be complicated.

Lilly has been embroiled in legal battles over allegations it misled patients and doctors about the side effects of its top-selling drug, Zyprexa.

Lilly also was one of a dozen companies included in The Corporate Library's 2007 "Pay for Failure" report on executive compensation and stock performance. Taurel earned $43.7 million in pay from 2002 to 2006, a time when Lilly's return for investors was a negative 24.6 percent, the report said.

Lechleiter pointed to other numbers from Taurel's CEO tenure: $20 billion, Lilly's expected revenue this year, roughly double from the time he took over at the company; 10, number of products introduced under Taurel; one, the number Lilly ranks among peers for its research-and-development budget as a percentage of sales.

For Lechleiter, Taurel's tenure and Lilly's long history help provide inspiration as well as lessons to help face the vexing challenges ahead.