When Mylan and Pfizer's Upjohn business trumpeted their pending merger in July, it marked a major coup for the generics maker's shareholders after a rough couple of years. Turns out the deal wasn't just profitable for investors––it could also be a big score for Mylan's C-suite.
Four Mylan executives are due golden parachutes totaling $71 million-plus after the drugmaker's expected merger with Upjohn closes, according to an SEC filing.
At the top of the pile, CEO Heather Bresch would net $30.8 million, almost $18 million of that in cash, the filing shows. That total also includes $12.6 million in equity awards that vest early and an additional $309,000 in benefits, which include three years of health, life and disability insurance, plus three years of car service and related expenses.
Mylan said the payouts were based on "multiple assumptions" of the company's value and said the amounts may change once the merger closes.
Bresch isn't the only Mylan leader due for a big payday. President Rajiv Malik is in line for $20.8 million when he eventually departs––he is expected to stay on as president of the new company for now, but leave down the road. Malik's parachute includes $12 million in cash, $8.2 million in equity payouts and $577,000 in benefits.
In a May proxy filing, Mylan estimated that Bresch would be due a $37.8 million payout if the company sold based on the company's estimate of its own value at the end of the year.
CFO Kenneth Parks, who is also set to retire once the merger closes, will net $6.2 million, and Anthony Mauro, Mylan's chief commercial officer, is in line for a $5.2 million payment.
Chairman Robert Coury is expected to stay on with newly formed company in the same role.
If the merger closes, it would mark a lucrative end to Bresch's career at Mylan after overseeing an Upjohn merger that would revitalize both businesses.
In July, Pfizer and Mylan announced the marriage, which would deliver a company posting an estimated $19 billion to $20 billion in revenue next year. In total, the new company would have 51 manufacturing sites, including 25 for solid doses, seven making injectables, eight turning out other complex formulations, and 11 API sites. In total, the manufacturing plants could produce more than 80 billion doses annually.
Bresch was the target of shareholder criticism in recent years as revenue dipped and shares stagnated, sparking a strategic review in August 2018 that eventually led to the merger. Bresch is a 28-year veteran at Mylan, starting as a desk clerk in 1992 and eventually leading a company with 45,000 employees and more than $20 billion in annual revenue from 165 countries.
Bresch's time at Mylan was marked by controversy, though, from a résumé mistake early on to compensation criticism to the EpiPen pricing scandal that landed her in front of a Congressional committee to explain.
In 2016, news surfaced that the drugmaker had been hiking prices for years on its lifesaving epinephrine injector to the point where many parents had a hard time paying for their back-to-school packages. Lawmakers struck up investigations and consumers blasted the drugmaker’s motives.
Bresch, for her part, defended Mylan's pricing by pointing to the drug pricing and rebating system in the U.S. Along with the EpiPen fiasco, Mylan paid $465 million to the federal government to settle claims it underpaid Medicaid rebates. In May, President Donald Trump signed into law the Right Rebate Act that would prevent the chronic misclassification of meds that led to Mylan's inflated EpiPen rebates.
In a letter to employees in July, Bresch reflected on her 28 years of service at Mylan, saying ensuring patient access to treatments has always been a core mission. She's served as chief integration officer, COO and president, and numerous other roles. She said the journey "has been life-altering, and the many relationships I have forged will be life-long,” she wrote.