Jeffrey Simmons

About Jeffrey Simmons

Jeffrey Simmons is President and CEO of Elanco and has served as a director since September 2018; he previously led Elanco within Eli Lilly from 2008–2018 after a 30+ year career in life sciences with roles spanning international marketing, country leadership, and R&D oversight. Age: 57. Education not disclosed in the proxy. Under his leadership, 2024 results included $4.439B revenue, $910M adjusted EBITDA, $0.91 adjusted EPS, $541M operating cash flow, and $1.475B gross debt paydown; the company launched one blockbuster and five potential blockbusters and delivered $461M innovation revenue . Five-year TSR translated a $100 investment into $41 by 2024, and the proxy notes a 19% share price decrease in 2024 that reduced “compensation actually paid,” evidencing alignment between realized pay and shareholder returns .

Past Roles

Organization	Role	Years	Strategic Impact
Elanco Animal Health (Eli Lilly division)	SVP and President, Elanco Animal Health	2008–2018	Directed Elanco’s growth and transformation to a global leader; executed major acquisitions including Bayer Animal Health; built >$2B pet health business
Eli Lilly and Company	International Marketing Manager; Country Director (Brazil); Area Director (Western Europe); Executive Director (U.S. & Global R&D)	Not disclosed	Launched numerous animal health blockbusters; deepened R&D and global operating expertise

External Roles

Organization	Role	Years	Notes
—	—	—	No other public company directorships listed in Simmons’ proxy biography

Fixed Compensation

Metric	2022	2023	2024
Base Salary ($)	1,125,000	1,200,000	1,200,000
Target Bonus (% of Salary)	—	130%	130%
Actual Annual Bonus Paid ($)	1,360,125	1,232,400	1,606,800

Notes:

2024 annual cash incentive was based solely on Elanco Cash Earnings (ECE); corporate multiplier was 103% after excluding the divested Aqua business from both 2023 baseline and 2024 performance for comparability .

Performance Compensation

Incentive	Metric	Weighting	Target	Actual/Outcome	Payout	Vesting/Timing
Annual Cash Incentive (2024)	Elanco Cash Earnings (ECE)	100%	$(520)M ECE baseline (ex-Aqua)	$(509)M ECE (ex-Aqua)	103%	Cash, paid after FY end
Performance Awards (PAs) 2023–2024 cycle	Adjusted EBITDAR	50% of LTI mix	Multi-year target framework per plan	Final attainment average: 90.36%; Simmons earned 449,408 shares	90.36%	Vested after 12/31/2024 performance period
Performance Awards (PAs) granted 2024	Adjusted EBITDAR	50% of LTI mix	Targets set relative to prior-year EBITDAR and required return	In progress	—	Vests following 2025 performance; payout date Feb 2026
RSUs granted 2024	Time-based	25% of LTI mix	—	—	—	One-third on 3/1/2025, 3/1/2026, 3/1/2027
Stock Options granted 2024	Time-based	25% of LTI mix	Strike $16.03, 10-year term	—	—	One-third on 3/1/2025, 3/1/2026, 3/1/2027; expire 3/1/2034

Additional detail:

2024 LTI target grant for Simmons: $12,000,000 split 50% PAs ($6,000,013), 25% RSUs ($3,000,015), 25% options ($3,000,005); RSUs 187,150 shares; Options 408,164 at $16.03 .
The Compensation Committee adjusted both the annual bonus ECE and PA EBITDAR frameworks to exclude the 2024 mid-year Aqua divestiture to avoid penalizing deleveraging; the 2023 baseline and 2024 performance were restated accordingly .

Equity Ownership & Alignment

Item	Detail
Total Beneficial Ownership	2,325,532 shares; <1% of outstanding; includes 145,000 via Revocable Trust
DSUs Held	29,750 DSUs (not counted in beneficial ownership for Section 16 purposes)
Options Exercisable within 60 days	853,344 shares (aggregate across awards)
2024 Outstanding Equity Snapshot	2018 options: 109,642 exercisable @ $31.61 (exp. 10/20/2028) ; 2022 options: 154,544 exercisable / 79,616 unexercisable @ $28.94 ; 2023 options: 187,424 exercisable / 380,528 unexercisable @ $11.26 ; 2024 options: 408,164 unexercisable @ $16.03 . RSUs: 2022 29,960; 2023 166,608; 2024 187,150 unvested units . Performance awards: 2023–2024 497,336 target units (vested based on 90.36% attainment); 2024–2025 374,299 target units outstanding .
Ownership Guidelines	CEO required to hold ≥6x salary; all NEOs in compliance or making progress as of May 2024
Hedging/Pledging	Prohibited for directors and employees; none of Simmons’ shares pledged
Deferred Compensation	2024 contributions of $168,408 (13,647 DSUs); year-end aggregate balance $156,868

Vesting and potential supply windows:

RSU and option tranches on 3/1/2025, 3/1/2026, 3/1/2027; 2024 PA cycle expected payout Feb 2026. These dates can concentrate insider selling windows subject to blackout policies .

Employment Terms

Scenario (as of 12/31/2024)	Cash Severance	Benefits (PV)	Equity Acceleration	Key Mechanics
Death	—	—	$13,259,393	Full acceleration upon death
Disability/Qualified termination (non-CIC)	$5,520,000	$69,085	$10,180,766	CEO plan: 2x base + 2x target bonus; pro-rata vesting standards for certain awards
Non-qualified discharge (non-CIC)	$5,520,000	$69,085	—	No equity acceleration
Qualifying termination post-CIC (double trigger)	$5,520,000	$53,522	$15,525,774	Double-trigger; RSUs/options fully vest; PAs vest at target

Other contractual terms and governance:

No individual employment agreement; no excise tax gross-ups; robust clawbacks (SEC/NYSE-required and supplemental for misconduct); equity grant timing policy avoids MNPI periods .
Severance contingent on release of claims and customary post-employment covenants (non-specified) .

Board Governance

Role and independence: Simmons is CEO and a director (since 2018) and serves on the Finance, Strategy and Oversight Committee; the Board determined he is not independent due to management role .
Leadership structure: Independent non-executive Chairman (Lawrence Kurzius); 93% of current directors independent; all committees fully independent; regular executive sessions .
Committees/attendance: Board met eight times in 2024; each director attended at least 75% of meetings of the Board and applicable committees .
Director pay: As an employee, Simmons receives no director compensation .

Say-on-Pay & Shareholder Feedback

Say‑on‑pay support: 93% approval at the 2024 annual meeting, signaling strong investor alignment with the compensation program .
Engagement: Independent chair led late‑2024/early‑2025 outreach to holders representing ~45% of shares to discuss governance, strategy, and pay .

Compensation Committee Analysis (program design context)

Independent Compensation and Human Capital Committee chaired by Kirk McDonald; independent consultant WTW advises the committee exclusively; target total compensation generally calibrated to peer median with a heavier equity mix versus market .
2024 benchmark peer set targets median revenues ~$4.1B; peer group updated in Aug 2024 (removed Horizon; added Bausch Health, Biogen) .

Related Party Transactions (governance)

Not directly related to Simmons; in March 2025, the Audit Committee approved a research agreement with WEDterinary LLC (affiliated with departing director William Doyle) with up to $4M funding, and Doyle resigned upon execution; disclosed under related person transactions .

Investment Implications

Pay-for-performance alignment: CEO pay is >90% variable/performance-linked at target; 2024 bonus and 2-year PA outcomes (103% and 90.36%) reflect measured payouts tied to ECE and EBITDAR, amid a year where TSR fell, reducing realized pay—mitigating overpay risk .
Vesting calendar and potential selling pressure: Time‑based RSUs/options from 2024 grants vest annually on March 1 (2025–2027) and 2024 PA cycle pays in Feb 2026—key supply windows subject to blackout and 10b5‑1 plans .
Alignment and retention: Large beneficial ownership, strict anti‑pledging/hedging, and a 6x‑salary ownership guideline (in compliance) anchor alignment; double‑trigger CIC and formal severance plan protect continuity without single‑trigger optics .
Governance watch item: Committee adjustments excluding the Aqua divestiture from 2024 and 2025 pay metrics are reasonable for comparability but merit ongoing scrutiny for precedent and calibration discipline .

Signal: Modest above-target cash bonus (103%) and sub‑target PA payout (90.36%) in 2024, despite strong cash flow and deleveraging, indicate compensation outcomes tracking core operating metrics while remaining sensitive to shareholder return headwinds **[1739104_0001739104-25-000030_elan-20250327.htm:55]** **[1739104_0001739104-25-000030_elan-20250327.htm:59]** **[1739104_0001739104-25-000030_elan-20250327.htm:6]** **[1739104_0001739104-25-000030_elan-20250327.htm:79]**.