CEO pay

Le Fur in line for $11.3M parachute

Tracy Staton — Mon, 15 Sep 2008 10:37:11 -0400

Feeling sorry for Gerard Le Fur? After all, he was squeezed out of the CEO seat at Sanofi-Aventis to clear the way for GlaxoSmithKline's Chris Viehbacher. This, after less than two years in the top job, but many, many years in the company ranks.

Well, you can hold your sympathy for now. According to Sanofi's regulatory filings, the board agreed in February to pay Le Fur a "termination benefit" of 24 months' pay. According to the Financial Times, that would amount to as much as $11.3 million--before stock options and other benefits. If the golden parachute doesn't include bonuses, though, that number could be reduced by almost $2 million. And if the board decides to call Le Fur's ouster as a "retirement," then he gets only 20 months' pay.

Sanofi is set to release the financial costs of its management shift, and a multimillion-dollar chute could meet with a backlash in France. CEO salaries there typically aren't nearly as large as those at U.S. companies. And golden parachutes in particular have drawn scrutiny, so much so that legislators have introduced a measure that would peg severance pay to company performance.

- read the Financial Times article

Swiss pricing pressure angers Vasella

Tracy Staton — Tue, 27 May 2008 10:09:32 -0400

Daniel Vasella (photo) is riled. The Novartis CEO says its hometown officials are putting too much pressure on drug prices. Swiss Interior Minister Pascal Couchepin should keep in mind that reduced prices could interfere with innovation--and would lower Novartis' tax revenues, too. (The company pays $488 million or so to the Swiss government each year.) "The pressure from (Couchepin) is too strong,” he told the Berner Zeitung. “Drugs in Switzerland are now cheaper than in Germany.”

Meanwhile, Novartis may be celebrating the EU's OK to sell its new Extavia MS drug. Rightfully so. But even after launching the drug--first in a new portfolio of Novartis treatments for MS--the company has, shall we say, a long row to hoe. Extavia will face stiff competition from existing drugs such as Bayer's Betaseron. It could take a couple of years for Novartis to penetrate the MS market in any significant way, analysts say. "It is difficult to know what market percentage Novartis is going to achieve with this new drug," Tom Muller, an analyst with Theodoor Gilissen, told Forbes.com. "They have to start from scratch."

- see the Forbes article on Extavia
- check out the Pharmalot item on Vasella

Who are pharma's true VIPs?

Tracy Staton — Fri, 23 May 2008 10:57:38 -0400

You mean you don't know? Helpfully, a trade magazine has ranked them for you. The 40 most influential people in pharma--and they're not always the people you'd expect. In fact, FDA Commissioner Andy von Eschenbach didn't make the list. Who did? Carl Icahn, for one. The highest ranking CEO was (drum roll, please) Genentech's Arthur Levinson at the number two spot. GlaxoSmithKline's new CEO Andrew Witty came in came in at number six. Other familiar names include Bill and Melinda Gates (3), Janet Woodcock (18), Warren Buffett (25)and J. Craig Venter (27). You'll have to read the list to get the rest.

- check out the list and article in World Pharmaceuticals (.pdf)
- see the Pharmalot item

GSK investors attack exec pay, performance

Tracy Staton — Thu, 22 May 2008 10:47:37 -0400

It's been a tough week for outgoing GlaxoSmithKline CEO Jean-Pierre Garnier. Browbeaten during a BBC interview on Tuesday, he was "heckled" by annoyed shareholders at yesterday's annual meeting. Investors complained about the stock's lackluster performance and rebelled against what they called excessive executive pay. At least Garnier's pain was shared by the company's board: "I am getting fed up with this underperformance," one shareholder said to applause. "This board is a continuing failure."

One paycheck at issue was Chris Viehbacher's one-time retention bonus, a stock award worth between $4 million and $5 million. Viehbacher, you'll recall, was in the running to replace Garnier, but lost out to incoming chief Andrew Witty. One of GSK's big investors questioned the bonus, saying it had "insufficient justification." (It's worth noting, however, that the other CEO hopeful, David Stout, left GSK after Witty was appointed.)

Investors criticized other exec's pay, too, saying it's not sufficiently linked to the company's stock performance. Only 61 percent of shareholders voted in favor; considering the usual rubber-stamp shareholder vote, that's a low percentage. Last year, GSK's pay plan got 92.5 percent of the vote.

Perhaps Garnier was simply taking out his frustrations on a handy target when he scoffed at the idea of GSK buying rival AstraZeneca. "What kind of future do they have?" he asked. "What kind of pipeline do they have? Why would you trade down?"

- see the story in the Financial Times
- check out the article in The Telegraph
- read the item in the Wall Street Journal Deal Blog
- get the Pharmalot take
- find the WSJ Health Blog item

Top 17 paychecks in Big Pharma

Maureen Martino — Tue, 20 May 2008 09:15:33 -0400

Few statistics are as hotly debated as CEO pay reports. Investors, analysts, and the just plain curious all want to know how much the head honcho makes--and how one company's chief stacks up against another's. While the names themselves probably won't be a surprise, their pecking order might. For instance, the biggest drugmaker by sales--Pfizer--doesn't have the highest-paid executive, and one of the relatively small fry counts its chief among the top 10.

For U.S. companies, FiercePharma's numbers are based on total compensation reported in their proxy statements. The numbers include base salary, bonus and "other" compensation in 2007. For overseas companies not required to file proxies in the U.S., we gleaned executive pay information from various press reports. So here for your rubbernecking pleasure are the 17 highest-paid CEOs in Big Pharma.

- see the special report

Related Article:
CEO pay: Who makes what in Big Biotech?

Bayer's Werner Wenning - CEO Pay

Tracy Staton — Mon, 19 May 2008 15:03:13 -0400

Werner Wenning - Bayer

Total Compensation: $4.77M

2007 Revenue: $50.84B
2006 Revenue: $45.46B
Change: 11.8%

Details: Wenning earned just over half a million dollars in base salary, $2.3 million in bonus pay and $1.1 million in stock grants.

Bayer News:
Bayer lower 2008 expectations
Bayer plans to beef up biotech pipeline

GlaxoSmithKline's Jean-Pierre Garnier - CEO Pay

Tracy Staton — Mon, 19 May 2008 15:02:20 -0400

Jean-Pierre Garnier - GlaxoSmithKline

Total Compensation: $6M

2007 Revenue: $44.09B
2006 Revenue: $42.81B
Change: 2.9%

Details: Garnier earned a $1.8 million base salary in 2007, along with a $2.7 million bonus. GSK's top executive officially handed over the reigns to incoming CEO Andrew Witty, but not before scoring a $4.9 million options bonus that could pay off sometime in 2010 (the bonus was not included in his 2007 slary).

GSK News:
GSK's Garnier gets $4.9M handshake
GSK's Garnier to join Dubai equity firm
At GSK, a public race for the top spot

Mylan's Robert Coury - CEO Pay

Tracy Staton — Mon, 19 May 2008 15:00:15 -0400

Robert Coury - Mylan

Total Compensation: $8.54M

2007 Revenue: $2.17B
2006 Revenue: $1.61B
Change: 34%

Details: Mylan CEO and Vice Chairman Robert Coury brought down $10.3 million during fiscal 2007, which ran only nine months because the drugmaker changed its fiscal year. Coury earned salary of about $1.12 million, stock awards of $1.15 million, and about $2.1 million in incentive compensation. Mylan was the only company that primarily produces generics drugs to grace our top 17.

Mylan News:
Mylan CEO intent on new global biz
Mylan CEO makes $10M in 9 months

Roche's Franz Humer - CEO Pay

Tracy Staton — Mon, 19 May 2008 14:59:13 -0400

Franz Humer - Roche

Total Compensation: $11.1M

2007 Revenue: $44.2B
2006 Revenue: $33.5B
Change: 31.9%

Details: Humer's base pay in 2007 was $5.74 million and he earned a $2.86 million bonus. He also earned about $1.75 million in stock an options. 2007 was Humer's last year as Roche's CEO. In a surprise move, Humer handed over the top executive post to Severin Schwan, head of Roche's diagnostics division. Humer remains Chairman of the company.

Roche News:
Schwan takes helm of Roche in surprise move
Roche won't budge on $3 billion Ventana offer

Pfizer's Jeffrey Kindler - CEO Pay

Tracy Staton — Mon, 19 May 2008 14:57:06 -0400

Jeffrey Kindler - Pfizer

Total Compensation: $12.6M

2007 Revenue: $48.6B
2006 Revenue: $48.3B
Change: .6%

Details: 2007 was not Pfizer's best year, seeing that the company started things off with one of the biggest drug development flops in recent history. CEO Jeffrey Kindler's pay is low when compared to rivals, but it was still up significantly from $9.8 million in 2006. Kindler pulled in $1.35 million in base pay, $3.1 million in cash bonuses (down slightly from 2006), $7.5 million in stock and options. His other compensation included $175,000 for aircraft use and over $42,000 for his use of a car.

Pfizer News:
Woe is Pfizer, analysts say
Investors, analysts not impressed with Pfizer
Is Pfizer's CEO as bold as promised?
Pfizer chiefs sees pay decline
Pfizer's Kindler leaves analysts feeling flat