Since Taurel became CEO in July 1998, Lilly's stock price has fallen 17 percent. By comparison, the overall market, as measured by the S&P 500, advanced 28 percent.
Lilly, like other big drugmakers, has struggled to bring new blockbusters to market. It currently is pinning its hopes on a drug-thinner in the development pipeline called prasugrel. The company hopes the drug helps offset lost sales on Zyprexa, whose U.S. and European patents expire in 2011.
Zyprexa, an antipsychotic, had $4.4 billion in sales in 2006.
Sales of the drug have been strong, even as lawsuits over side effects and other issues piled up against it. To settle suits, Lilly has paid out more than $1.2 billion to tens of thousands of plaintiffs.
Lilly announced Taurel's retirement this morning. Taurel, 58, will step down as CEO in March and remain chairman until December 2008.
His successor is John Lechleiter, 54, whom Taurel long has been grooming for the position. Lechleiter has been wth the company nearly 20 years. He's been president and chief operating officer since October 2005.