Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On October 5, 2021, Elanco Animal Health Incorporated ("Elanco") announced that Aaron Schacht, Executive Vice President of Elanco, would transition to a new role leading the potential carve-out of Elanco's microbiome R&D platform (the "Microbiome Platform"). On December 31, 2021, Mr. Schacht, and certain other employees supporting the Microbiome Platform, separated from Elanco as part of the restructuring plan announced by Elanco on November 30, 2021.

Elanco expects to enter into an agreement with an affiliate of Mr. Schacht, whereby Mr. Schacht will lead an external team responsible for the continuing development of the Microbiome Platform on behalf of Elanco, as well as continue to advise on the potential carve-out of the Microbiome Platform from Elanco. Under the agreement, Elanco is expected to pay the entity a service fee of up to $750,000, made in installments through March 31, 2022, which will be used to pay compensation to Mr. Schacht's team and related expenses for the development work. Elanco may also pay a contingent fee tied to the consummation of the carve-out transaction.

In connection with his separation, Elanco entered into a Severance Agreement and Release of Claims (the "Agreement") with Mr. Schacht on January 1, 2022, pursuant to which he is entitled to receive severance benefits under the Elanco Amended and Restated Executive Severance Pay Plan and Summary. These benefits are contingent upon Mr. Schacht executing a release of claims in favor of Elanco and agreeing to certain other customary post-employment covenants.

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