Elanco Animal Health (ELAN) reported 10% year-over-year growth for its latest quarter, delivered evenly across farm-animal and pet-health segments, U.S. and international markets, and price versus volume, CEO Jeff Simmons told investors at the Bank of America Global Healthcare Conference in London on September 22, 2026.
The Indianapolis-based company, which marked its eighth anniversary as an independent entity divested from Eli Lilly on Friday, holds a market capitalization of approximately $11.34 billion. Revenue over the trailing twelve months reached $5.02 billion, reflecting nearly 12% growth. Gross profit margin stood at 55% and is projected to move toward 60% over time, while EBITDA was $1.01 billion, with management expecting the margin to climb from the low-20s toward 30% in the medium term.
"We have delevered the company after acquiring Bayer," Simmons said. "We were 6 to 7 times levered. We will be at approximately 3 times by the end of the year, headed into the 2 times next year." The firm stated its goal is to reach roughly 2x net leverage by the end of 2025, rising to about 2.5x in 2026.
Looking ahead through 2028, Elanco outlined a multi-year financial algorithm projecting mid-single-digit revenue growth, high single-digit EBITDA growth, low double-digit EPS growth, and $1 billion in cumulative free cash creation. The company also introduced its "Ascend" cost-savings initiative, targeting $200 million to $250 million in annual EBITDA savings by 2030. Full-year 2026 earnings per share is forecast at $1.14.
Pricing power remained in focus. First-half price growth came in at 2%, with pricing accelerating in July and August. Simmons indicated the company expects price increases to stay within the 2% to 3% range for the foreseeable future.
On the product pipeline, Elanco highlighted six blockbuster products currently in early commercialization and 15 projects in clinical development, with zero attrition since December. The firm plans to launch an additional five to six blockbusters between now and 2031.
Key pipeline assets include Zenrelia, used as a first-line therapy by more than 40% of U.S. veterinarians, up from below 20% a year ago. The treatment is available in 44 to 46 countries with clean labels internationally and captured more than 50% market share in Brazil within 18 months, picking up 400 to 500 clinics per month. U.S. label updates are underway, including completion of a booster study and removal of a "persistently infected" designation supported by PCR data; additional trial results are expected by the end of 2024, with potential label changes arriving in mid-2027.
Credelio Quattro, a broad-spectrum parasiticide, became the fastest blockbuster in Elanco's 71-year history, surpassing $100 million in sales and reaching more than 50% of U.S. clinics. An international rollout is planned for 2027, beginning with the United Kingdom and Europe.
Befrena, a monoclonal antibody for allergies, is facing temporary supply constraints as manufacturing scales from 200-liter to 2,000-liter and 5,000-liter bioreactors. Full supply is expected in the first half of 2025, and the product is projected to become a meaningful U.S. growth driver in 2027. Among surveyed U.S. veterinarians, 85% indicated immediate demand.
Beyond Elanco-specific drivers, Simmons pointed to favorable demographics: the U.S. population over age 60 is projected to grow 25% by decade's end, and GLP-1 users consume 30% to 50% more animal protein than non-users. The environmental productivity market is estimated at $2 billion to $4 billion, while the broader animal-health industry is growing from $40 billion to a projected $60 billion, with pet health accounting for roughly 40% and farm animals 60%.
A survey of 1,400 U.S. pet owners conducted in late May found 86% said they would maintain or increase spending on pet health. Roughly one-third of the pet market is distributed through retail channels, and about one-third of pet owners do not visit a veterinarian at all, purchasing over-the-counter products instead. There are approximately 30,000 veterinary clinics in the United States, slightly less than a third of which are operated by corporate groups or conglomerates.
