No terms were released, but Lilly said Monday that its 2014 earnings forecast will be trimmed due to acquisition costs.
The Indianapolis drugmaker recently lost patent protection for its top-selling product, the antidepressant Cymbalta. Lilly has been hit hard by patent losses in recent years and has said it expects both earnings and revenue to dip this year as it adjusts.
The company, which also is known for a portfolio of diabetes treatments, has said it will depend on its animal health business to help make up for the loss of revenue.
Germany's Lohmann SE also sells a range of feed additives, but Lilly said that the acquisition will significantly increase Elanco's ability to make vaccines. Competing in that market is a "cornerstone" of the subsidiary's long-term strategy, the company said.
The deal is expected to close in the second-quarter.
The company now expects adjusted earnings for this year to range between $2.72 to $2.80 per share due to accounting adjustments and costs tied to the deal. That's down from its previous forecast for between $2.77 and $2.85 per share.
Analysts had expected earnings of $2.83 per share, according to FactSet.
Shares of Eli Lilly and Co. climbed more than 1 percent, or 66 cents, to $58.62 Monday morning, slightly outpacing the Standard & Poor's 500 index. The shares reached $58.88 earlier in the session, their highest price in more than six years.