Novartis had a tough year in 2007: Its vaunted new diabetes drug Galvus got the stiff-arm treatment from the FDA, so much so that the company may not even try again to get it approved. Its painkiller Prexige ran into reports of liver problems; first withdrawn in Australia, it fell in other countries one after the other, domino-style. Zelnorm caught the FDA fisheye, and Novartis finally agreed to withdraw it for safety reasons. The company managed to report a fourth-quarter profit, but at a level 45 percent less than last year's numbers.
And profits aren't the only thing that fell. So did CEO Dan Vasella's (photo) pay. He took home 17 million Swiss francs ($15.6 million), which is no chump change, but it's 20 percent less than he made last year. It's the first time his pay has dropped since he took over at Novartis over ten years ago. Sometimes pay-for-performance packages really hurt. Other Novartis execs took bigger hits. Thomas Ebeling, former chief of the company's pharma unit (and now consumer health honcho), saw his pay fall by 65 percent to 3.7 million francs, or $3.36 million.
Three guesses which unit delivered its boss more pay this year than last. Hint: its sales grew by 20 percent to $7.2 billion and profits rose by a hefty 41 percent to $1 billion. That's right, generics. Andreas Rummelt (photo), Sandoz's chief, made 5.6 million francs ($5 million), 16 percent more than last year.
- see the earnings news from Novartis
- read the compensation article in the Wall Street Journal Health Blog
- get more about Novartis' rosier outlook for the second half of 2008
ALSO: Take a look at Novartis' pipeline. Report