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Eli Lilly stock decline hits DC plan, endowment

A decline in Eli Lilly & Co. stock on Monday, the result of a rejection of a rheumatoid arthritis drug by the Food and Drug Administration, led to a decline in assets in both the company's 401(k) and the Lilly Endowment Inc., Indianapolis.

Eli Lilly, Indianapolis, saw an estimated decline of $31 million in the company stock portion of its $6.18 billion company 401(k) plan as a result of rejection of the rheumatoid arthritis drug baricitinib.

However, Lilly Endowment lost an estimated $422 million, based on the $10.49 billion in company stock it held as of April 14, according to a Securities and Exchange Commission filing. The Lilly Endowment had $11.8 billion in assets as of Dec. 31, 2015, the latest data available.

According to Pensions & Investments' data, the Lilly 401(k) plan had 12.3% of assets in company stock as of Sept. 30, or $760 million.

According to P&I data and Lilly's 2016 annual report, Lilly's $7.452 billion defined benefit plan does not have any company stock as investments.

Lilly stock opened Monday at $81.30, down 5.3% from the close on April 13 (markets weren't open on April 14), but closed at 82.38.

The FDA on April 14 notified Lilly and the company assisting in the drug's development, Incyte, that the agency was unable to approve the drug application in its current form and that additional clinical data was needed to determine appropriate doses.

In a news release on Lilly's website, said Christi Shaw, president of Lilly Bio-Medicines, said, “We are disappointed with this action. … We will continue to work with the FDA to determine a path forward and ultimately bring baricitinib to patients in the U.S.”

Officials at both Lilly and the Lilly Foundation could not be immediately reached for comment.