2012 Annual Report  • In January 2012, the FDA issued a Complete Response Letter (CRL) regarding the NDA for dapagliflozin. The CRL requests  additional clinical data to allow a better assessment of the benefit-risk profile for dapagliflozin. The companies will continue to  work closely with the FDA to determine the appropriate next steps for the dapagliflozin application, and are in ongoing  discussions with health authorities in other countries as part of the application procedures. The Company has met with the FDA  and now has a path forward for potential approval for  Forxiga  in the U.S. The Company will provide additional data from  ongoing studies to the FDA and expects to be able to resubmit the NDA for  Forxiga  in mid-2013. At this time, the Company  expects that the FDA will have a six–month period in which to review the resubmission and will hold an Advisory Committee  meeting.  $^{ }$• In November 2012, the Company announced the results of the global, D-LITE Phase IIb study, in which a 24-week regimen  combining the investigational compound peginterferon lambda-1a with the investigational direct-acting antiviral (DAA)  daclatasvir and ribavirin, achieved sustained virologic response 12 weeks post-treatment of treatment-naïve, genotype 1b chronic  hepatitis C virus infection patients who achieved a protocol-defined response  • In November 2012, the Company announced Phase II data demonstrating that the 12-week Triple DAA treatment regime of  daclatasvir, asunaprevir, and BMS-791325 (an NS5B non-nucleoside polymerase inhibitor) achieved sustained virologic response  12 weeks post-treatment in 94% of treatment naïve, genotype 1 chronic hepatitis C virus infection patients.  • In November 2012, the Company announced Phase II data demonstrating that the dual regiment of daclatasvir and asunaprevir,  without interferon or ribavarin, achieved high rates of sustained virologic response 12 weeks post-treatment in patients with  genotype 1b hepatitis C virus infections who were prior null responders to alfa interferon and ribavarin.  $^{ }$• In December 2012, the Company announced the results of a small, randomized Phase II study in patients with previously treated  myeloma. Two doses were tested, 10mg/kg and 20 mg/kg in combination with lenalidomide and low-dose dexamethasone. In  the 10 mg/kg arm, median progression-free survival (PFS), or the time without disease progression or death, was not reached after  20.8 months of follow up (N=36) and the objective response rate (ORR) was 92%. Of patients who received elotuzumab at a  dose of 20 mg/kg, median PFS was 18.6 months (N=37) and ORR was 76%.  • In February 2013, the Company announced that the FDA has granted an additional six-month period of exclusivity to market  Sustiva . Exclusivity for  Sustiva  in the U.S. is now scheduled to expire in March 2015.  $^{ }$• In February 2013, the U.S. District Court for the District of Delaware invalidated the composition of matter patent covering  Baraclude , which was scheduled to expire in 2015.  • In October 2012, a labeling update for  Baraclude  was approved by the FDA to include data on African Americans and liver  transplant recipients with chronic hepatitis B infection.  • In July 2012, the FDA granted full approval of  Erbitux  in combination with the chemotherapy regimen folfiri (irinotecan, 5- fluorouracil, leucovorin) for the first-line treatment of patients with KRAS mutation-negative epidermal growth factor receptor- expressing metastatic colorectal cancer as determined by FDA-approved tests for the use.  • In April 2012, the FDA issued a CRL regarding the supplemental Biologics License Application (sBLA) in first-line non-small  cell lung cancer which stated that, based on the current data package, the first-line indication for  Erbitux  in combination with  vinorelbine and cisplatin is not approvable. Lilly and the Company do not plan to resubmit the filing.  5  $^{ }$Erbitux  (cetuximab) – a monoclonal antibody designed to exclusively target and block the Epidermal Growth Factor Receptor, which  is expressed on the surface of certain cancer cells in multiple tumor types as well as normal cells and is currently indicated for use  against colorectal cancer and head and neck cancer. Erbitux  is part of our alliance with Lilly.  $^{ }$Baraclude  (entecavir) – an oral antiviral agent for the treatment of chronic hepatitis B  $^{ }$Sustiva  (efavirenz) – a non-nucleoside reverse transcriptase inhibitor for the treatment of HIV.  In November 2012, we provided notice of the termination of our global codevelopment and cocommercialization arrangement for  necitumumab (IMC-11F8), a fully human monoclonal antibody being investigated as an anticancer treatment, which was discovered  by ImClone and was part of the alliance between the Company and Eli Lilly and Company (Lilly), with all rights returning to Lilly. The termination is effective May 2014, though we and Lilly may terminate earlier.  $^{ }$Necitumumab – a novel targeted cancer therapy for non-small cell lung cancer  $^{ }$Elotuzumab – an anti-CS1 antibody under investigation for the treatment of multiple myeloma  $^{ }$Hepatitis C Portfolio – (Peginterferon lambda –a novel and potential first-in-class type 3 interferon in development; Daclatasvir – a  NS5A replication complex inhibitor in development; Asunaprevir – a NS3 protease inhibitor in development)