It's clear that Pfizer's ($PFE) erstwhile chief executive will get a big golden handshake as a retirement goodbye. Some $16.5 million big--plus stock options, which could add quite a bit to that total, depending on how Pfizer's stock performs.
First, Jeff Kindler (photo) will get a major chunk of cash. His severance pay--awarded by the board just yesterday--comes to $4.5 million. His 2010 bonus amounts to $3.25 million plus $1.8 million in short-term incentives. In all, that's $9.5 million in hard currency. The rest of Kindler's departing compensation includes retirement benefits--worth an estimated $6.9 million--plus restricted stock units and other stock options, some of which will be converted to Pfizer shares this month.
But as golden as that handshake sounds, it's not nearly as rich as the departing package for Kindler's predecessor, Hank McKinnell, Reuters reports. McKinnell, who worked for Pfizer for 35 years, received about $200 million. Kindler served at Pfizer for eight years. That's a difference of 27 years and $183.5 million, or roughly $6.5 million per year. And it's not much more than his 2009 pay package of $14.9 million.
Nor does Kindler's departing payment measure up to the big packages collected by some recently departed Big Pharma execs--such as former Schering-Plough chief Fred Hassan's (photo) $49.65 million in 2009 pay--because they included change-in-control bonuses (Hassan's was $33 million, earned via Schering's merger with Merck).
Kindler's goodbye is more in line with other executives who've been "nudged out" of their companies, one pharma analyst told the New York Times. "For a true resignation you wouldn't get paid this," University of Michigan's Erik Gordon told the paper. "This is a generous negotiated deal. It's not out of line with what CEOs of large companies get when they're in this position." That's sure to fuel more speculation about why Kindler left so abruptly.