Eli Lilly CEO's pay falls 9% to $21.5M—no thanks to pension declines

Eli Lilly posted 15% revenue growth last year amid multiple new drug launches, including COVID-19 antibodies. But the drugmaker’s CEO pay didn’t enjoy the same upturn.

Lilly CEO David Ricks collected $21.5 million for his 2021 compensation, down 9% from the $23.7 million he got in 2020, a proxy filing (PDF) shows.

The decline can be attributed to a sharp $3.4 million decline in the value of Ricks’ pension. The fall was mainly because of a higher discount rate used in Lilly’s mathematical model to calculate the value of future benefits.

Elsewhere, the chief executive collected $1.5 million in salary. His stock awards rose 10% to just short of $15 million. Ricks’ cash bonus dropped, though by only $150,500, or 6%, to $2.475 million.

The company’s earnings per share (EPS) number came below expectations, Lilly said in its proxy. In setting up executives’ 2021 bonus scorecard, Lilly’s board had previously targeted $8.05 in non-GAAP EPS. But after adjustment, the Indianapolis pharma only hit $8 in 2021.

On other line items that determined Rick’s bonus, Lilly’s revenue and pipeline advancement exceeded internal goals thanks to multiple new drug launches and key clinical trial data readouts.

Lilly’s revenue reached $28.3 billion, representing 15% year-over-year growth. The company’s COVID-19 antibody combo, bamlanivimab and etesevimab, nabbed an FDA emergency use authorization in February 2021 to treat non-hospitalized patients. Lilly’s COVID-19 antibody windfall was one reason for the company’s strong revenue performance last year.

More recently, though, the U.S. federal government stopped distributing the Lilly combo in January after the FDA had limited its use as the drugs appear unlikely to tackle the dominant omicron variant.

Also in 2021, Boehringer Ingelheim-partnered SGLT2 inhibitor Jardiance scored U.S. and EU label expansions to treat heart failure with reduced ejection fraction. And thanks to an FDA nod in October, Lilly’s Verzenio became the first CDK4/6 inhibitor to treat certain patients with HR-positive, HER2-negative, node-positive, early breast cancer at high risk of recurrence after surgery.

Lilly has a big year ahead, with two of its drugs leading the top 10 most anticipated drug launches of 2022.

Gearing up for the next stage of Type 2 diabetes competition, Lilly in December filed tirzepatide with the FDA and used a priority review voucher to expedite the evaluation process. The dual GLP-1 and GIP receptor agonist aced multiple phase 3 trials in Lilly’s SURPASS program last year. Evaluate Vantage recently predicted the drug could reach $4.9 billion in sales in 2026.

The top drug on Evaluate’s drug launch list is Lilly’s Alzheimer’s disease candidate donanemab, with anticipated 2026 sales of $6 billion. Like Biogen’s controversial Aduhelm, donanemab targets the amyloid plaques in the brain. Last year, Lilly started a rolling submission with the FDA, shooting for an accelerated approval based on data from a phase 2 trial.

Lilly anticipates a slow launch for donanemab if it gets an approval based on amyloid clearance biomarker data. But a key phase 3 readout that could confirm the drug’s effect on cognition progression is scheduled for 2023.

Chief Scientific and Medical Officer Daniel Skovronsky, M.D., Ph.D., the mastermind behind Lilly’s R&D efforts, received $7.53 million in his 2021 pay package, up 2% over the prior year.