Elanco Animal Health Incorporated (ELAN): Business Model Canvas [Dec-2025 Updated]

You're looking to understand the engine room of Elanco Animal Health Incorporated (ELAN) right now, and after two decades analyzing this space, I can tell you their 2025 playbook is clear: innovation funding paired with aggressive deleveraging. The whole strategy is anchored by that full-year revenue guidance topping out near $\mathbf{\$4.670 \text{ billion}}$, driven by key launches and a pipeline boasting over $\mathbf{170}$ active programs. It's a tightrope walk between high R&D spend and maintaining a healthy balance sheet, which is exactly what you'd expect from a company focused on both pet therapeutics and livestock sustainability. I've broken down the entire nine-block Business Model Canvas below, showing you precisely where their $\mathbf{\$55 \text{ percent}}$ gross margin comes from and who their key partners are in this push. Check out the details to see the full picture.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Key Partnerships

You're looking at how Elanco Animal Health Incorporated builds value by leaning on external relationships, which is crucial when you're driving innovation across a portfolio that saw 8% organic constant currency revenue growth in Q2 2025 and raised its full-year innovation revenue target to between $840 million and $880 million as of the third quarter of 2025.

Purdue University for the One Health Innovation District

This partnership is a physical manifestation of Elanco Animal Health Incorporated's commitment to the 'One Health' concept-the interconnectedness of human, animal, and environmental health. The district is anchored by Elanco Animal Health Incorporated's new global headquarters, which was set to open in the second quarter of 2025. Elanco Animal Health Incorporated committed up to $2 million of initial funding to jumpstart a new Animal Health Venture Fund within this ecosystem. The shared-use facility itself occupies 3 acres and includes office space, wet labs, and incubator areas for collaboration between industry and academia. Furthermore, Elanco Animal Health Incorporated committed to purchasing an additional 12 acres for future expansion of the district, showing a long-term stake in this local innovation hub.

Contract Research Organizations (CROs) for R&D pipeline advancement

Elanco Animal Health Incorporated views external partnerships as essential for resource-efficient innovation. The company maintains a rich pipeline with more than 170 active programs across various species and development phases. Leveraging Contract Research Organizations helps Elanco Animal Health Incorporated progress these projects effectively, augmenting internal research and development capabilities. This strategy is key to supporting the ambition of delivering consistent, high-impact innovation.

Global distributors and wholesalers for product reach

Getting products to farmers and pet owners globally requires a vast network. While the specific number of global distributors isn't public, Elanco Animal Health Incorporated does leverage a wide manufacturing base to support its global reach. The company collaborates with approximately 250 external manufacturing partners, which is vital for navigating regulatory complexities and scaling production for its diverse portfolio of 11,000 SKUs. This network underpins the company's ability to serve customers worldwide.

Licensing partners like Neurizon Therapeutics for IP monetization

Monetizing intellectual property through strategic licensing de-risks development for partners and provides Elanco Animal Health Incorporated with future revenue streams. The exclusive global licensing agreement with Neurizon Therapeutics, executed on July 1, 2025, for Monepantel (the active ingredient in NUZ-001) is a prime example. For Elanco Animal Health Incorporated, the financial structure includes:

• A nominal upfront payment.
• Development milestone payments up to $9.75 million for initial products.
• Development milestone payments up to $5.2 million for subsequent products.
• Sales milestones tied to commercial success, up to $65 million.
• Ongoing revenue via tiered single-digit royalties on global net sales.

This deal helps Elanco Animal Health Incorporated focus its internal resources while still benefiting from the potential of its legacy assets.

Academic groups for early-stage research and talent pipeline

Beyond the physical One Health Innovation District, Elanco Animal Health Incorporated invests directly in the future workforce. The 2024 Impact Report, released in June 2025, highlighted a commitment to education. Specifically, Elanco Animal Health Incorporated committed $310,000 in scholarships to support the advanced education of students entering veterinary science and animal health fields. This directly supports the goal of training the next generation of professionals who can solve industry challenges.

Here's a quick look at the quantifiable partnership elements we've seen:

The reliance on external manufacturing partners, numbering around 250, is a clear indicator of how Elanco Animal Health Incorporated manages capacity and complexity across its 11,000 SKUs.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Key Activities

Pharmaceutical research and development (R&D) for new blockbusters remains a critical engine for Elanco Animal Health Incorporated, driving future revenue streams. For the twelve months ending September 30, 2025, Elanco Animal Health Research and Development Expenses were reported at $356M. This activity is supported by a rich pipeline, with the company maintaining over 170 active programs across various species and development phases. To be fair, the R&D spend shows fluctuation; for instance, Q1 2025 saw R&D expenses increase by 8% to $94 million, while Q3 2025 R&D expenses saw a more modest increase of only 2%. The focus here is on first-in-class or differentiated late-stage potential blockbusters in high-value pet health markets.

Global commercialization of key innovation products is clearly paying off, especially with the launch of Credelio Quattro (lotilaner, moxidectin, praziquantel, and pyrantel chewable tablets). This product became Elanco Animal Health Incorporated's fastest pet health blockbuster in history, reaching $100 million in net sales in less than eight months. The demand is strong; in June 2025, Credelio Quattro captured approximately 14% of the dollar share in broad-spectrum sales out of U.S. veterinary clinics. This success is part of a broader innovation push; Elanco raised its full-year 2025 innovation revenue target to a range of $840 to $880 million as of November 2025. Another key launch, Zenrelia (ilunocitinib tablets), is now in market in the European Union and Great Britain, and the company stated that more than half a million dogs have been treated with it globally. The volume increase in Q3 2025, which was 9%, was primarily driven by these new products.

You need to see the performance of the key drivers:

• Credelio Quattro: Reached $100 million in net sales in under eight months.
• Zenrelia: Over 500,000 dogs treated globally as of late 2025.
• Experior: Q2 2025 sales were up over 80% year-over-year.
• AdTab: Q2 2025 sales were up over 60% year-over-year.

Here's a quick look at how the innovation portfolio is tracking against the original expectations:

The execution of the Elanco Ascend productivity and cash generation program is a major activity set to impact future efficiency. This company-wide initiative, launched in Q2 2025, is expected to drive additional productivity and capabilities, positioning Elanco for improved productivity and efficiency over the rest of the decade, with expected Adjusted EBITDA growth in 2026. The focus on discipline is showing up in the balance sheet; the year-end 2025 net leverage ratio target improved to 3.7x to 3.8x, supported by an expected gross debt paydown range of $500 to $550 million in 2025. Cash provided by operations in Q3 2025 was $219 million.

Manufacturing and quality control of medicines and vaccines is managed by the Manufacturing and Quality (M&Q) organization, which prioritizes delivering an uninterrupted supply of products while maintaining competitive costs. This activity involves applying robust quality standards at every stage, governed by a global Quality Management System and Standard Operating Procedures (SOPs). The Global Quality Assurance team regularly assesses and audits both internal manufacturing sites and contract manufacturing partners. Elanco maintains controls to ensure products are safe, efficacious, and reliably meet quality specifications in line with requirements for each product's respective Marketing Authorization, collaborating closely with regulatory authorities such as the U.S. Food and Drug Administration (FDA) Center for Veterinary Medicine (CVM) and the U.S. Department of Agriculture (USDA) Center for Veterinary Biologics (CVB).

Life Cycle Management (LCM) is a core activity for extending the life and value of existing brands, which helps stabilize the base business. This involves targeted extensions to maintain brand relevance. Elanco points to several existing blockbuster products that benefit from this focus, including Seresto (dogs and cats), Rumensin (cattle), Advantage Family (dogs and cats), Credelio Family (dogs and cats), and Maxiban (poultry). Furthermore, the company is actively managing its pipeline, such as receiving notification from the FDA for revised U.S. label language for Zenrelia in Q4 2025, removing risk language of fatal vaccine-induced disease.

Finance: draft 13-week cash view by Friday.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Key Resources

You're looking at the core assets Elanco Animal Health Incorporated uses to compete. These aren't just things they own; they are the capabilities that drive their value proposition in the animal health space. Honestly, for a company this size, the resources are heavily weighted toward science and scale.

The foundation rests on a deep bench of intellectual property and the people who create and manage it. Consider the pipeline; it's the future revenue engine. You see the commitment to innovation reflected in the targets they set for new product sales.

Here are the quantified Key Resources as of late 2025:

• Diverse portfolio of 9 blockbuster products (>$100M annual revenue).
• R&D pipeline with over 170 active programs across species and development phases.
• Global manufacturing and distribution network across over 90 countries worldwide.
• Intellectual property (IP) and patents for key drug compounds, managed by a formal Invention Review Committee (IRC).
• Scientific talent and expertise in animal health pharmaceuticals, with R&D hubs in locations like Switzerland and China.

The focus on innovation is clear when you look at the expected contribution from new offerings. For the full year 2025, Elanco Animal Health Incorporated raised its innovation revenue target to a range of $840 million to $880 million, which is revenue incremental to 2020 sales.

To give you a clearer picture of how some of these key product resources are performing, look at the recent revenue contributions and market penetration figures. This shows you where the current value is being generated from their established portfolio:

The global reach is a massive physical asset. Elanco Animal Health Incorporated supplies its products and services to farmers, veterinarians, and pet owners in more than 90 countries. This scale is what allows them to commercialize those pipeline assets globally once they clear regulatory hurdles.

You should also note the financial strength supporting these resources, specifically the focus on deleveraging, which frees up capital for future investment or debt reduction. The company improved its 2025 year-end net leverage ratio target to between 3.7x and 3.8x Adjusted EBITDA, supported by strong cash generation and asset monetization, like the agreement to monetize certain lotilaner U.S. royalties starting in Q2 2025.

The scientific talent is formalized through internal governance structures. Elanco Animal Health Incorporated uses a cross-functional Invention Review Committee (IRC), governed by an IRC Governance Board, to make strategic IP investment decisions. This structure is designed to foster the collaboration needed to progress their innovation projects effectively and in a resource-efficient way.

Finance: draft 13-week cash view by Friday.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Value Propositions

You're looking at the core value Elanco Animal Health Incorporated delivers across its two main segments-Pet Health and Farm Animal-as of late 2025. This isn't just about selling pills and feed additives; it's about delivering measurable outcomes for pets, vets, and producers, which is clearly reflected in their recent financials.

For instance, the overall business momentum is strong, with third-quarter 2025 revenue hitting $1,137 million, marking a 10% increase year-over-year, supported by 9% organic constant currency growth. That kind of growth suggests the value propositions are resonating.

High-impact innovation for pet health (e.g., Zenrelia for dermatology)

Elanco Animal Health Incorporated is delivering differentiated, high-impact solutions directly addressing significant unmet needs in companion animal care. Zenrelia, the canine dermatitis medication, is a prime example of this focus, contributing significantly to revenue growth following its launch period.

The U.S. Pet Health segment, which saw $533 million in revenue in Q3 2025, is being powered by these newer innovations. While the FDA revised U.S. label language for Zenrelia was anticipated in Q4 2025, the product was already being used in approximately 11,000 U.S. clinics as of Q1 2025, showing early adoption.

Here's a look at how key innovations are performing:

• Zenrelia™: Driving growth in the dermatology space.
• Credelio Quattro™: Captured about 10% dollar share of U.S. vet clinic broad-spectrum sales by Q1 2025.
• Innovation revenue target for the full year 2025 was raised to between $720 million and $800 million.

Solutions for livestock sustainability (e.g., Bovaer for methane reduction)

For livestock producers, the value proposition centers on sustainability metrics that also offer financial upside. Bovaer, the methane-reducing feed additive, is central to this offering. It directly helps operations meet Scope 3 emissions goals for their downstream partners.

The adoption rate shows momentum: cows on Bovaer quadrupled between February and Q2 2025. This product reduces enteric methane emissions by about 30%, which equates to roughly 1.2 metric tons of carbon dioxide equivalent (CO2e) per lactating dairy cow annually.

The Farm Animal segment brought in $593 million in Q3 2025, up 10% organically year-over-year, indicating producers are investing in these types of solutions.

Comprehensive parasite protection across multiple price points for pet owners

Elanco Animal Health Incorporated provides broad access to parasite control, ensuring coverage for different owner needs and budgets. They are focused on being the go-to source for flea, tick, and worm prevention.

The company has established a strong market position in this area, ranking as the #1 retail parasiticide dispenser in the U.S. This comprehensive approach is supported by established brands:

This shows a substantial revenue base from established parasite control products, which likely span various price tiers.

Trusted, differentiated medicines and vaccines for veterinarians

Veterinarians rely on Elanco Animal Health Incorporated for products that are scientifically differentiated and backed by clinical trust. This segment values efficacy and safety profiles that support better patient outcomes.

The company's innovation pipeline is designed to deliver one new parasiticide innovation on average per year through 2025, reinforcing this commitment to the veterinary channel. The strong organic growth in Pet Health, at 8% in Q3 2025, is partly driven by these new veterinary-prescribed products.

Key elements of trust include:

• Delivering new innovation to the marketplace.
• Strong real-world performance data for new products like Zenrelia.
• The launch of TruCan™ Ultra CIV, a new canine influenza vaccine, in Q2 2025.

Improving food safety and animal wellbeing for livestock producers

Beyond just methane reduction, the value proposition for livestock producers includes tangible improvements in food safety and overall herd health, which translates to better operational efficiency and market access.

Elanco Animal Health Incorporated actively supports this through programs and products like Experior, a feed additive that has seen significant growth in 2025 from its FDA approval for use in finishing heifers. Furthermore, the company's commitment to food safety is demonstrated through direct producer education.

Specific actions supporting wellbeing and safety include:

• Educated nearly 150 global producers via the Elanco Food Safety Programme to tackle Salmonella outbreaks in poultry in 2024.
• Experior growth is tied to improving environmental metrics and operational efficiency for cattle producers.
• Bovaer has shown no significant impact on milk production, milk quality, or animal health in dairy studies.

The company's net leverage ratio improved to 3.7x Adjusted EBITDA by the end of Q3 2025, showing disciplined execution that underpins the ability to continue delivering these value propositions. Finance: review the Q4 2025 cash flow forecast against the raised Adjusted EBITDA guidance of $850 to $890 million by end of year.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Customer Relationships

Dedicated sales force and technical service for veterinarians and producers is a core component of how Elanco Animal Health Incorporated engages its professional customer base.

Elanco Animal Health Incorporated has focused on the expansion and enhancement of its commercial sales force in pet health to capitalize on innovative products. The company leverages its distribution partners to amplify its share of voice by a factor of 2.5 to 3x in terms of the number of people talking to customers. This engagement covers the company's 5 Core Species: Pet health & farm animals, specifically Dogs, cats, cattle, swine, and poultry. For context on the scale of the business Elanco serves, its revenue for the third quarter of 2025 was $1,137 million, with a full-year 2025 revenue guidance of $4,645 million to $4,670 million.

Direct-to-consumer marketing focuses heavily on the over-the-counter (OTC) segment, where Elanco Animal Health Incorporated is the #1 retail parasiticide dispensing company in the U.S. Specific product lines supporting this channel show significant contribution; for example, The Advantage® Family of products and Seresto contributed revenue of $153 million in the first quarter of 2025. The company is actively expanding this retail presence with global offerings like AdTab and the U.S. launch of Pet Protect, a new line of veterinary-formulated pet supplements under the Advantage family umbrella.

Educational programs serve both the farm animal and companion animal segments, providing technical support and risk mitigation strategies. The Elanco Food Safety Programme (FSP) is a science-based tool designed to help poultry producers prevent and control Salmonella outbreaks. Key metrics related to these educational and support initiatives include:

• Educated nearly 150 global producers via the Elanco Food Safety Programme in 2024.
• The FSP is present in 24 countries.
• Since 2005, control programs have reduced all Salmonella serovars in European laying hens by 78% and broilers by 84%.
• The Parvo Defenders Task Force included the ParvoTrack-powered by Elanco online tool, which had 1,300 reported cases collectively reported from veterinarians and pet owners as of May 2025.
• More than 7,500 pet owners and veterinarians signed up for parvo alerts via ParvoTrack-powered by Elanco.

Regarding long-term supply agreements, Elanco Animal Health Incorporated has taken steps to secure its manufacturing base. The company acquired the Speke, UK, contract manufacturing facility in November 2024, which was previously under a long-term supply agreement with TriRx Speke Ltd. This facility is vital for producing farm animal product lines that represent approximately $160 million to $180 million in annual farm animal revenue, mostly outside the U.S. The situation related to this facility is expected to result in an adjusted EBITDA headwind between $25 million and $35 million for the full year 2025. Separately, in May 2025, Elanco entered an agreement to monetize certain lotilaner U.S. royalties for proceeds of $295 million.

Here is a summary of key quantitative data points related to Elanco Animal Health Incorporated's customer relationship activities as of late 2025:

Finance: draft 13-week cash view by Friday.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Channels

You're looking at how Elanco Animal Health Incorporated gets its products, from prescription drugs to preventative chews, into the hands of veterinarians, farmers, and pet owners as of late 2025. The company is clearly leaning hard on its innovation portfolio, which requires significant channel support; operating expenses were guided to increase approximately 8% year-over-year in constant currency for the full year 2025, reflecting incremental strategic investment in global launches.

Veterinary clinics and hospitals (Credelio Quattro, Zenrelia)

Veterinary clinics and hospitals remain a core channel, especially for Elanco Animal Health Incorporated's newer prescription and broad-spectrum products. Credelio Quattro, for instance, captured approximately 14% of the dollar share in broad-spectrum sales specifically out of U.S. veterinary clinics in June 2025. This product reached blockbuster status, hitting $100 million in net sales in under eight months. Zenrelia, the dermatology treatment, is now in use at about 11,000 U.S. clinics as of the first quarter of 2025. The momentum on Zenrelia in the U.S. has been positive, with total company sales for the product doubling from the second quarter to the third quarter of 2025.

Third-party distributors and wholesalers globally

While specific revenue breakdowns by third-party distributors aren't public, their role is implicit in the global reach of Elanco Animal Health Incorporated's portfolio. The company is preparing for the global expansion of Credelio Quattro starting in 2026 across Australia, Canada, the EU, the UK, and Japan. Zenrelia is already available across the European Union, Great Britain, Brazil, Canada, and Japan, in addition to the U.S. This international availability relies heavily on established global distribution networks. The company's overall Q3 2025 revenue was $1,137 million, showing broad international movement across its segments.

Independent retailers and global retail offerings (e.g., AdTab)

The over-the-counter (OTC) portfolio is clearly targeting retail expansion, a strategy Elanco Animal Health Incorporated is actively increasing. AdTab, the oral flea and tick treatment, saw its sales double year-over-year in the first quarter of 2025 after its UK launch in April 2025. Furthermore, AdTab sales showed a 60% increase in the second quarter of 2025. The stated strategy includes solely increasing points of distribution in retail stores for this OTC portfolio.

Direct sales to large-scale farm animal producers

For the Farm Animal segment, direct engagement with large-scale producers is key, particularly for differentiated products like feed additives. The number of cows on Elanco Animal Health Incorporated's methane-reducing feed additive, Bovaer, doubled since February 2025. Experior, a product in this segment, saw sales surge by over 80% year-over-year in the second quarter of 2025. The Farm Animal segment delivered a 7% increase on an organic constant currency basis in Q1 2025.

E-commerce platforms for certain OTC products

While specific e-commerce revenue figures aren't broken out, the focus on retail distribution for OTC products like AdTab suggests an omnichannel approach where e-commerce platforms are a component. Globally, e-commerce sales are projected to reach $6.86 trillion in 2025, accounting for nearly 20% of total retail sales worldwide. Elanco Animal Health Incorporated is focused on expanding physical availability, which often complements digital presence.

Here's a quick look at the performance of key products within their primary channels as of mid-to-late 2025:

The company's overall innovation revenue target for the full year 2025 was raised to a range of $840 million to $880 million.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Customer Segments

You're looking at the core groups Elanco Animal Health Incorporated serves to generate its revenue, which for the trailing twelve months ending September 30, 2025, stood at $4.591B. The company's updated full-year 2025 revenue guidance projects total revenue between $4,645 million and $4,670 million.

The customer base is fundamentally split between companion animals and farm animals, which served as the primary revenue drivers in 2024, with Pet Health products accounting for 48% of total revenue and Farm Animal products representing 51%. For the third quarter of 2025 specifically, the revenue split was:

• Pet Health revenue: $533 million.
• Farm Animal revenue: $583 million.

The United States is the single largest market, contributing 46% of total revenue based on 2024 figures.

Companion Animal Veterinarians (U.S. and International)

Veterinarians are key prescribers and purchasers, especially for Elanco Animal Health Incorporated's therapeutics and parasiticides. The company's focus on innovation is directly aimed at capturing share within this professional channel. For instance, the dermatology treatment Zenrelia is now in use at approximately 11,000 U.S. clinics as of the first quarter of 2025. Furthermore, the parasiticides Credelio Quattro and AdTab are critical drivers in this space. Credelio Quattro, a newer offering, is seeing about 70% of its sales come from switches from competitive products as of the third quarter of 2025. Zenrelia achieved approximately 5% market share in countries where it has launched as of the third quarter of 2025.

Pet Owners (dogs and cats) seeking parasiticides and therapeutics

Pet owners are the end-users for many of Elanco Animal Health Incorporated's most popular products, often accessing them through veterinary clinics or retail channels. Revenue from established parasite control brands remains substantial. In the third quarter of 2025, the Advantage^® Family of products contributed $111 million in revenue, and Seresto^® contributed $60 million in revenue. The oral flea and tick treatment AdTab showed continued strong adoption, with third-quarter 2025 sales up over 25% year-over-year.

Livestock Producers (cattle, swine, poultry) globally

This segment focuses on efficiency, disease prevention, and sustainability for food animal production. The Farm Animal business saw its third quarter 2025 revenue reach $583 million. Growth in this area is heavily influenced by key products like Experior for cattle and strong poultry sales globally. Elanco Animal Health Incorporated reported that Experior sales increased approximately 70% in the third quarter of 2025, following over 100% growth in the prior year. On the sustainability front, the number of cows on Elanco Animal Health Incorporated's methane-reducing feed additive Bovaer doubled between February and the first quarter of 2025.

Third-party distributors and independent retailers

Distributors and retailers form the essential channel for product movement, particularly for over-the-counter or non-prescription items, ensuring broad market access. While specific revenue figures for this channel alone aren't broken out separately from the Pet Health or Farm Animal segments, their role is implied in the overall sales structure. The company achieved market share gains in global pet retail sectors in 2024. The third quarter 2025 results showed that Farm Animal organic constant currency revenue growth included a 2% increase from price, compared to the third quarter of 2024, while Pet Health revenue included a 1% decrease from price.

Here's a look at the reported revenue contribution by the two main segments for Q3 2025:

Finance: review the Q4 2025 distributor inventory levels against the full-year guidance of $4,645 million to $4,670 million by next Tuesday.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Cost Structure

You're looking at the cost side of Elanco Animal Health Incorporated's operations as of late 2025. The structure is heavily weighted toward supporting a pipeline of new products and maintaining a global commercial footprint. Honestly, the costs reflect a company in a significant investment phase, trying to translate R&D into market share.

High R&D expenditure to fuel the 170+ program pipeline. While the exact pipeline size of 170+ programs isn't confirmed in the latest reports, the commitment to innovation is clear through the raised financial targets. Elanco Animal Health Incorporated is pouring resources into getting new products like Credelio Quattro and Zenrelia to market, which directly impacts operating costs.

Operating expenses increasing by approximately 8% for innovation launches. For the full year 2025 guidance, Elanco Animal Health Incorporated now expects operating expenses to increase by approximately 8% year over year in constant currency, which is up from a previous expectation of 7%. This incremental strategic investment is specifically tied to the global launches of the innovation portfolio.

Cost of Goods Sold (COGS) implied by 54.9% to 55.2% adjusted gross margin. The cost to produce the goods sold is inversely related to the expected adjusted gross margin for the full year 2025, which management raised to a range of 54.9% to 55.2%. This implies a COGS range of approximately 44.8% to 45.1% of revenue.

The third quarter of 2025 saw the adjusted gross margin percentage land at 53.1%, a 90 basis point increase compared to the third quarter of 2024.

Significant interest expense on debt, though deleveraging is a priority. Debt servicing remains a notable cost. The company has been actively managing this, including the strategic refinancing of a $2.1 billion term loan to extend maturities through 2032. Interest expense figures for recent periods show this cost:

The net leverage ratio as of September 30, 2025, was 3.7x Adjusted EBITDA, an improvement from 0.6x lower than December 31, 2024. The year-end 2025 net leverage ratio target was improved to 3.7x to 3.8x.

Selling, General, and Administrative (SG&A) costs for global sales force. The costs associated with the global sales force and general operations are substantial, driven partly by the need to support new product launches. For the twelve months ending June 30, 2025, Elanco Animal Health Incorporated's SG&A expenses were $1.364 billion, representing a 5.25% increase year-over-year.

Here's a quick look at some key cost-related metrics as of late 2025:

• Selling, General, and Administrative Expenses (TTM ending June 30, 2025): $1.364 billion.
• Expected Operating Expense Increase (Full Year 2025): Approximately 8% in constant currency.
• Expected Adjusted Gross Margin (Full Year 2025): 54.9% to 55.2%.
• Capital Expenditure (2025 Expectation): About $250 million.
• Estimated Tariff Impact (Full Year 2025): $10 million to $14 million.

Finance: draft 13-week cash view by Friday.

Elanco Animal Health Incorporated (ELAN) - Canvas Business Model: Revenue Streams

The revenue streams for Elanco Animal Health Incorporated are anchored in the sales of its diverse portfolio across companion and food animal health sectors, supplemented by strategic monetization of intellectual property.

The company has raised its full-year 2025 revenue guidance to a range of $4.645 billion to $4.670 billion, reflecting strong momentum through the third quarter of 2025.

Sales of Pet Health products contribute significantly, with reported revenue reaching $533 million in the third quarter of 2025, representing an 8% increase on an organic constant currency basis. Key products driving this include innovations like Credelio Quattro, which achieved approximately 10% share of U.S. broad-spectrum product sales into veterinary clinics in the first quarter of 2025, and Zenrelia, which was in use at about 11,000 U.S. clinics as of the first quarter of 2025.

Farm Animal product sales generated reported revenue of $593 million in the third quarter of 2025, marking a 10% increase on an organic constant currency basis, driven by volumes across cattle and poultry. Experior is noted as one of the innovation products contributing to positive momentum in the Farm Animal segment.

Innovation revenue, which includes the commercialization of new products, is now targeted for the full year 2025 to be between $840 million and $880 million. This is an increase from earlier guidance, reflecting positive momentum for products like Credelio Quattro, Experior, AdTab, and Zenrelia.

Royalty and milestone payments from licensing agreements provide an additional stream, notably following the agreement announced in May 2025 to monetize certain U.S. royalties and commercial milestones associated with lotilaner (XDEMVY) to Blackstone for an upfront payment of $295 million in cash. The company expected to relinquish approximately $10 million in royalty revenues for 2025 as part of this deal.

Here's a quick look at the updated full-year 2025 financial guidance points:

The revenue generation is supported by the performance of specific product categories:

• Sales of Pet Health products, with Q3 2025 revenue at $533 million.
• Sales of Farm Animal products, with Q3 2025 revenue at $593 million.
• Revenue from innovation portfolio launches.
• Income from royalty and milestone payments.

The Pet Health segment saw its third-quarter growth driven by:

• Organic constant currency revenue growth of 8%.
• A 1% decrease from price, in line with expectations.

The Farm Animal segment's third-quarter growth included:

• Reported revenue of $593 million.
• Organic constant currency revenue growth of 10%.
• A 1% increase from price compared to the third quarter of 2024.

Finance: draft 13-week cash view by Friday.