Elanco Adds New Tools to Advance U.S. Livestock Sustainability Efforts

As the urgent, time-sensitive issues of hunger and climate change lead headlines around the world, Elanco Animal Health (NYSE: ELAN) announces two new resources aimed at helping the cattle industry make a positive impact.

According to the United Nations, the world only has until 2030 ? just eight years ? to curb emissions or see irreversible damage to the planet¹. Meanwhile, the World Health Organization shows a full 60% of the world's population lacked proper nutrition in 2020, either through inadequate year-round access to nutrition² or the wrong nutrition³, leading to problems ranging from hunger and malnutrition to obesity. These statistics are driving significant increased focus on the footprint and sustainability of many industries. They're also creating value creation opportunities for industries, like animal agriculture, that can make an impact.

"We believe environmental sustainability is the next era of opportunity for livestock production," said Jeff Simmons, president and CEO of Elanco Animal Health. "We have to empower our farmers and ranchers with innovation, tools and insights to help them create value and make a difference on these societal issues. We cannot solve these global challenges this fast any other way. We need innovation. We need better regulatory pathways to speed adoption. We need common metrics and an ability to measure progress."

The stakes have never been higher, and Simmons addressed thousands of producers at the National Cattleman's Beef Association annual meeting outlining significant advancements in Elanco's efforts to move from commitments to action. The company has pledged to be a leading partner in helping its customers reach Net Zero emissions through four key areas: Innovation, Analytics, Value Creation, and Reputation Narrative. Elanco today announces forward-progress in both Analytics and Value Creation.

Analytics: Creating a Platform to Track and Drive Progress

Elanco is piloting UpLooktm, an insights engine based on more than 20 years of knowledge gained from its Elanco Knowledge Solutions (EKS) portfolio. UpLook is designed to predict greenhouse gas emissions and identify key drivers of an operation's carbon footprint, providing producers with a baseline of their current stewardship efforts. UpLook can help cattle feeders better understand their baseline, be empowered to recognize the key drivers of their carbon footprint and determine actionable steps to help move their operation toward improved sustainability and stewardship along with access to Elanco's industry-leading consultants. Elanco believes this established baseline and tracking of progress is the first step to certification and monetization of carbon reduction for producers. Initial pilots of the system are beginning with cattle feeders and availability is expected in the second quarter.

While livestock producers have long been stewards of the land, today they often don't get credit for their efforts. Elanco believes livestock are a central solution to help address the dual challenges of nourishing the population while mitigating climate change. Voluntary use of tools and resources such as UpLook can help document the great stewardship efforts of cattle producers and evolve their sustainability efforts towards being a value-driver for their operations in the future.

"We are excited to start to turn our commitments into action," said Dr. Sara Place, chief sustainability officer at Elanco. "This is the first step in a long-term commitment to learn and collaborate with our customers' as we navigate this new frontier of opportunity, while helping to make a significant difference for our world."

Value Creation: Creating a Marketplace for Economic and Reputational Value

Elanco is also announcing its investment in Athian, a start-up company created in partnership with venture studio High Alpha Innovation. Athian's key mission will be to help the cattle industry capture and claim carbon credits earned through sustainability efforts where possible, primarily by validating and certifying GHG reductions and carbon capture from services like UpLook. Athian is expected to aggregate data for producers of all sizes and then work to create a carbon credit marketplace to monetize and capture value from sustainability efforts. Through Athian, farmers and ranchers may have a greater opportunity to keep this value within the food system so that carbon credits do not flow out of the food chain to other industries, which is often called "off-setting." When an off-set occurs, the other industry is able to take credit for the reduction. By in-setting the credits, protein producers could potentially keep not just the economic value, but also the societal value of reducing the footprint for the products they produce.

"We are pleased to partner with Elanco and other thought leaders in the livestock production value chain as we launch Athian to certify, aggregate and monetize carbon credits," said Paul Myer, CEO of Athian. "Our partnership enables farmers and ranchers to fund sustainability projects that will enable the industry to reach their Net Zero emissions targets."

Elanco Launches Leave it Bettertm

Additionally, Elanco is announcing the launch of the Leave it Bettertm initiative. Inspired by the universal desire of farmers and ranchers to leave their land, their livestock, and their business better than when they started, the initiative will serve as an overarching program for Elanco's cattle sustainability outreach. This will include producer education, innovation, and partnerships, such as the multi-year partnership with Ducks Unlimited to help restore working grasslands in support of the U.S. Department of Agriculture Farm Service Agency's SAFE (State Acres For Wildlife Enhancement) program.

Elanco believes platforms such as UpLooktm, PenPointtm livestock placement and sorting system, and Athian are important pieces in the complex matrix of sustainable beef production, which is key to both feeding families and reducing the warming impact of food production. This suite of Value Beyond Product offerings are foundational to the company's differentiated approach in the livestock industry.

For more information on Elanco's Sustainability Efforts, visit https://www.elanco.com/en-us/sustainability

ABOUT ELANCO

Elanco Animal Health Incorporated (NYSE: ELAN) is a global leader in animal health dedicated to innovating and delivering products and services to prevent and treat disease in farm animals and pets, creating value for farmers, pet owners, veterinarians, stakeholders, and society as a whole. With nearly 70 years of animal health heritage, we are committed to helping our customers improve the health of animals in their care, while also making a meaningful impact on our local and global communities. At Elanco, we are driven by our vision of Food and Companionship Enriching Life and our Elanco Healthy Purposetm Sustainability/ESG Pledges ?all to advance the health of animals, people, and the planet. Learn more at elanco.com.

ABOUT ATHIAN

At Athian, we are technology experts with farming in our genes. We enable environmental sustainability for animal agriculture because we believe in being good stewards of the earth's resources for generations to come. We use software to aggregate, certify, and fund greenhouse gas reduction plans throughout the entire livestock value-chain.

Athian's Sustainable Livestock Systems platform is an industry-based analytics tool powered by AI that enables the livestock industry to make good on its sustainability commitments by providing carbon "insetting" credits. Athian's carbon credit marketplace provides quality greenhouse gas credits that fund livestock producers' sustainability measures. Learn how to join us in this effort at Athian.ai.

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¹https://news.un.org/en/story/2021/08/1097362
²https://www.who.int/news/item/12-07-2021-un-report-pandemic-year-marked-by-spike-in-world-hunger
³https://www.who.int/news-room/fact-sheets/detail/obesity-and-overweight