Pharma watchers often scrutinize executive pay packages at the time they are granted. But by the time an executive pockets the money, their actual pay numbers can end up being vastly different.
When it comes to total realized pay, Regeneron CEO Len Schleifer, M.D., Ph.D., took home $453 million in 2021, making him the highest-paid CEO in biopharma or healthcare in general, according to a new Stat analysis. Never in his 35 years as CEO of Regeneron has Schleifer received a paycheck that big in a single year at grant.
The jaw-dropping number is attributable to Regeneron’s share price gains. Typically, a large chunk of a biopharma CEO’s compensation is tied to the company’s stock, and its value can balloon if the share price grows over time.
In Schleifer’s case, the helmsman realized $446 million last year when he exercised certain option awards to acquire more than 920,000 Regeneron shares at a predetermined low price.
To put those numbers into perspective, Schleifer last year nabbed $6.47 million in pay without any stock awards. In 2020, though, Schleifer was the biopharma industry’s best-paid CEO with $135 million at grant value, including $130 million in stock awards. But those awards typically only live on paper at the time of grant, and the CEO only gains value from them by exercising or vesting option or stock awards down the line.
Stock awards aren’t necessarily a guarantee for additional realized gains. Take BridgeBio Pharma CEO Neil Kumar, Ph.D., who ranks third on Stat’s best-paid biopharma CEO list. Kumar realized $62 million from vesting stock awards of 1.09 million BridgeBio shares, bringing his total take-home pay last year to about $63 million.
For 2021’s grant compensation, Kumar got nearly $26 million, including $25 million from stock and option awards. But as BridgeBio noted in a proxy filing, thanks to a sharp decline in the company’s stock price toward the end of 2021, all those long-term equity incentives were “underwater,” meaning Kumar can’t realize their value.
Back in December, BridgeBio’s acoramidis, a potential competitor to Pfizer’s blockbuster Vyndaqel franchise, surprisingly failed in a phase 3 trial in the heart disease of transthyretin amyloid cardiomyopathy. The news saw BridgeBio’s shares plunge from more than $40 per share to around $11.
Elsewhere, Horizon Therapeutics chief Tim Walbert raked in the second most realized pay among biopharma CEOs last year at $70 million, according to Stat. Still, that number pales in comparison to the nearly $174 million realized by Schleifer’s second hand, Regeneron President and Chief Scientific Officer George D. Yancopoulos, M.D., Ph.D.
The disgraced former Seagen CEO Clay Siegall, Ph.D., brought home just under $54 million last year, ranking fifth on Stat’s list. Intellia Therapeutics CEO John Leonard, M.D., who collected $54 million, landed in fourth place.
Eli Lilly CEO David Ricks came in after Siegall, with nearly $50 million in realized 2021 pay, thanks to nearly $46 million in gains from exercised or vested equity interests. That’s compared to $21.5 million in Ricks’ total compensation last year at grant.
AbbVie CEO Richard Gonzalez also made Stat’s top 10 list among biopharma captains by taking home $45 million. At grant value, Gonzalez’s pay was nearly $24 million, which made him the third best-compensated biopharma CEO in 2021 on Fierce Pharma’s list.