Late last year it was fashionable to talk about Merck's dramatic turnaround. As the company wrapped up thousands of Vioxx claims with it $4.85 billion settlement, even that chunk of change was skewed positive. The deal would remove the cloud hanging over Merck's resurgence. And the cost could have been so much worse.
So, how much was that vaunted turnaround worth? Try $14.5 million in compensation for CEO Richard T. Clark (photo). His pay package for the year amounted to an 80 percent raise over 2006. It included $1.62 million in base pay, 37 percent more than 2006 levels, and $8.23 million in stock and options grants. That compares with $4.85 million in stock and options in 2006. Then there was $4.31 million in incentive pay, plus about $360,000 worth of miscellaneous items like retirement-plan matching funds ($10,125), a home security system ($51,024), and commuting costs ($18,686).
Since the company and partner Schering-Plough announced the results of their controversial study of the cholesterol med Vytorin, though, the company has lost sales of that blockbuster med and watched its stock decline, too. In reporting Clark's pay, The New York Times noted that Merck shares hit a 52-week low of $41.03 during Monday's trading, then closed down 49 cents at $41.26. The 52-week high? $61.62, set December 12. What a difference a few months can make.
Analysts cheer signs of turnaround at Merck. Report
Merck touts reorganization effort. Report
Fortune scolds Merck for "risky" programs. Report
Merck presents pipeline update to analysts. Report