|Shire CEO Flemming Ornskov|
When AbbVie ($ABBV) buys out Shire ($SHPG) for nearly $55 billion in a deal the two companies agreed on last week, there will be no golden parachute awaiting Shire chief Flemming Ornskov. Instead, there's a signing bonus in order: The helmsman will pocket just under $10 million for staying on with the combined company in a new role.
Ornskov, who will be based in Switzerland, will help lead the drugmakers' integration and oversee the creation of a new rare disease business unit within the merged pharma, the pair said Friday. For that, he'll net a so-called golden hello of $9.9 million--approximately 150% of his annual total compensation.
"I don't want to speak for Flemming, but I have had a number of discussions with him and I think he's excited about the role that he will play in the new company," AbbVie CEO Richard Gonzalez said on a recent call with investors.
Reporting directly to Gonzalez, Ornskov will spearhead the set-up of the rare-disease unit, which will contain products such as Shire's hereditary angioedema Firazyr, as well as offerings it picked up in last year's buyout of ViroPharma.
|AbbVie CEO Richard Gonzalez|
"That is an area that we are very, very excited about," Gonzalez said. "We believe it is a very high-touch kind of business, so we want to set it up in a separate individual business unit to make sure that we can maintain that patient focus that Shire has."
AbbVie will be looking to the fast-growing rare-disease field to help it expand beyond Humira, the world's best-selling drug and the generator of the majority of its revenue. Since spinning off from Abbott at the start of 2013, Humira has continued to grow--significantly--but it's set to lose patent protection in 2016.
And as it forays into the new arena, Ornskov won't be the only Shire director on hand to help out. Boardmembers Dominic Blakemore and Chairwoman Susan Kilsby will also be joining up with AbbVie, Gonzalez said.
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