NEW YORK (Reuters) - Eli Lilly's rewarded its Chief Executive Sidney Taurel with a $2.63 million payout in 2003 after its top executive took a pass on a paycheck in 2002 due to company performance.

The Indianapolis-based drugmaker reported Taurel received a $1.43 million base salary for 2003, and a bonus of $1.19 million for the year, according to a regulatory filing with the U.S. Securities and Exchange Commission. He also received a stock option grant for 350,000 shares.

During the 2002 calendar year, the company said Taurel chose to accept an annual salary of $1 "as a reflection of his confidence in and commitment to the company during this period of transition." Lilly's net income dipped five percent in 2002, and the stock fell 27 percent.

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Had Taurel not taken this action, Lilly said his annual base salary would have been $1.39 million for 2002. In 2001, he earned $1.31 million.

Lilly (LLY: Research, Estimates), which has struggled in recent years to deal with the loss of patent protection of its once flagship antidepressant drug Prozac, expects to gain approval of a handful of new drugs over the next several months that will help boost earnings.

Among them is Cymbal, a new depression drug that analysts expect eventually to garner annual sales of $2 billion.

Lilly expects 2004 earnings of $2.80 per share to $2.85 per share, or 18 percent to 20 percent better than 2003 results.