The following pages contain the consolidated balance sheets and statements of income and cash flows taken from the 2014 annual report of Eli Lilly, a major pharmaceutical.

REQUIRED:
Analyze the statements by using the ROE model. Estimate whether Lilly created value for its shareholders and identify the company€™s primary value drivers.

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Consolidated Statements of Operations Eli Lilly and Company and Subsidiaries Year Ended December 31 2014 (Dollars in millions, except per-share data) 2013 2012 $19,615.6 $23,113.1 $22,603.4 Revenue Cost of sales 4,796.5 4,932.5 4,908.1 Research and development 5,531.3 4,773.6 5,278.1 Marketing, selling, and administrative 6,620.8 7,125.6 7,513.5 Acquired in-process research and development (Notes 3 and 4) 200.2 57.1 Asset impairments, restructuring, and other special charges (Note 5) 468.7 120.6 281.1 Other-net, (income) expense (Note 17) (340.5) (518.9) (674.0) 16,615.3 17,223.8 17,195.2 Income before income taxes 3,000.3 5,889.3 5,408.2 Income taxes (Note 13) 609.8 1,204.5 1,319.6 $ 2,390.5 $ 4,684.8 $ 4,088.6 Net income Basic earnings per share 2.23 4.33 3.67 Diluted earnings per share 2.23 4.32 3.66 Consolidated Balance Sheets Eli Lilly and Company and Subsidiaries December 31 (Dollars in millions, shares in thousands) 2014 2013 2012 Assets Current Assets Cash and cash equivalents (Note 7) $ 3,871.6 $ 3,830.2 $ 4,018.8 Short-term investments (Note 7) 955.4 1,567.1 1,665.5 Accounts receivable, net of allowances of $55.0 (2014) and $62.2 (2013) 3,234.6 3,434.4 3,336.3 Other receivables 566.7 588.4 552.0 Inventories (Note 6) 2,740.0 2,928.8 2,643.8 Prepaid expenses and other 811.5 755.8 822.3 Total current assets 12,179.8 13,104.7 13,038.7 Other Assets Restricted cash (Note 3) 5,405.6 Investments (Note 7) 4,568.9 7,624.9 Goodwill (Note 8) 1,758.1 1,516.8 6,313.9 Other intangibles, net (Note 8) 2,884.2 2,814.3 4,752.7 Sundry 2,417.7 2,212.5 2,533.4 Total other assets 17,034.5 14,168.5 13,600.0 Property and equipment, net (Note 9) 7,963.9 7,975.5 7,760.2 Total assets $37,178.2 $35,248.7 $34,398.9 Liabilities and Equity Current Liabilities Short-term borrowings and current maturities of long-term debt (Note 10) $ 2,688.7 $ 1,012.6 2$ 11.9 Accounts payable 1,128.1 1,119.3 1,188.3 Employee compensation 759.0 943.9 940.3 Sales rebates and discounts 2,068.8 1,941.7 1,777.2 Dividends payable 530.3 523.5 541.4 Income taxes payable (Note 13) 93.5 254.4 143.5 Deferred income taxes (Note 13) 1,466.5 792.8 1,048.0 Other current liabilities 2,472.6 2,328.4 2,738.9 Total current liabilities 11,207.5 8,916.6 8,389.5 Other Liabilities Long-term debt (Note 10) 5,367.7 4,200.3 5,519.4 Accrued retirement benefits (Note 14) 2,562.9 1,549.4 3,012.4 Long-term income taxes payable (Note 13) 998.5 1,078.7 1,334.3 Other noncurrent liabilities 1,653.5 1,863.0 1,369.4 Total other liabilites 10,582.6 8,691.4 11,235.5