Eli Lilly & Co. reported record third-quarter net income of $171.4 million, up 14% from a year ago. Sales totaled $940.6 million, up a record 11%. The Indianapolis pharmaceutical firm said the results reflect growth in each of its units. Merck & Co.'s profit increased 31% to $311.8 million. Sales totaled $1.5 billion, up 12%. The Rahway, N.J., drug company attributed the results to strong unit volume gains, a better product mix, the continuation of cost controls as well as the favorable effect of the exchange rate.