Prozac Gives a Lift to Indiana Foundation

There’s one side effect of Prozac few know about: It has helped a low-key Indiana endowment become the nation’s biggest private foundation.

Profits generated by the world’s top-selling antidepressant drug have helped the Lilly Endowment make charities and communities very happy.

About 70% of the millions of dollars it gives away stays in Indiana. And the endowment doesn’t expect that to change now that it has supplanted the Ford Foundation in foundation rankings released in January by the Chronicle of Philanthropy.

“It probably will prompt some discussion around the country,” acknowledged foundation spokeswoman Gretchen Wolfram. “We also have an obligation to our founders to follow their wishes.”

The founding family of Eli Lilly & Co. created the independent endowment in 1937. An initial gift of 17,500 shares in the drug maker, valued at $280,000, has grown into 179 million shares (16% of the company) and assets valued at $12.7 billion.

“Lilly had a vision that every citizen in Indiana would have access to a foundation, and that vision has come true,” said Carol Simonetti of the Washington-based Council on Foundations.

Ford, which had assets of $9.4 billion, held the top ranking for more than 30 years. But in 1987, Lilly introduced Prozac, a large reason for the endowment’s more-than-sixfold growth over the last decade.

The drug brought in $2.4 billion in sales in 1996 and accounts for about every third dollar taken in by the company.

As the company grows, so goes the endowment. Reliance on dividends from the Lilly stock helped the endowment’s assets nearly double during 1997. It also contributed to a 25% drop during a single year, 1992.

The endowment’s headquarters is nestled among apartment buildings, with no identifying sign. Requests for interviews with top officers were denied.

“This is a fairly modest organization,” Wolfram replied.

Not in terms of giving. Over 61 years, its grants total about $2 billion, about half going toward community development in Indiana.

It ranges from the small--a $121,800 grant to a center for inner-city children in Indianapolis--to the large, with at least $53.5 million to help build and maintain a domed stadium in that city.

Since 1990, the endowment has poured $100 million in matching funds into building community foundations in 85 cities and towns across the state.