COVID-19 vaccine developers have enjoyed a windfall and so have their chief executives. Now, a group of investors are asking the companies to improve vaccine equity by heaping pressure at the C-suite level.
Pay packages for CEOs at COVID vaccine makers Pfizer, Johnson & Johnson, Moderna and AstraZeneca should be tied to making their shots available around the globe, a group of institutional investors wrote in a letter to the companies’ boards, Reuters reports.
The investors ask that the drugmakers’ use a WHO roadmap for vaccine equity as a component in evaluating executive pay “in a meaningful, material, measurable and transparent way,” as cited by the news wire.
The 65 investors manage altogether $3.5 trillion in assets, according to Reuters, but it’s not clear how much stake each of them has in the four companies. Achmea Investment Management, Nomura, Investec, Boston Common Asset Management, Candriam, GAM, Aegon and PGGM are among the participating investors.
Biopharma CEOs’ compensations are usually evaluated against corporate financial goals, return on investment to shareholders as well as clinical and regulatory development milestones. From that perspective, the successful development of COVID vaccines have all contributed to the pay packages of CEOs at Pfizer, J&J, Moderna and AZ in 2020.
But environmental, social and governance (ESG) have started to take their spots in CEO pay reviews, as investors are increasingly looking to these nonfinancial risk factors. For example, AZ has an ESG section in evaluating CEO Pascal Soriot’s 2020 annual bonus that includes “access to healthcare.”
AstraZeneca, through a collaboration with Serum Institute of India, has been a main force providing COVID shots to low- and middle-income countries, mainly thanks to the vaccine’s less stringent storage requirement. As of the end of September, the two had delivered over 145 million doses of Vaxzevria to COVAX, a global vaccine distribution initiative that provides for those less well-off territories. The shot, also known as Covishield in India, reportedly accounted for 90% of the 1.3 billion doses given in the country as of early December.
In J&J’s 2021 proxy filing, a shareholder proposal asked that the company’s board report how government financial support will affect access to the pharma giant’s COVID vaccines and therapeutics. In asking investors to vote against the suggestion, the J&J board pointed out the company had committed to allocate up to 500 million vaccine doses to lower-income countries.
About 60% of J&J’s COVID vaccines were shipped to low- and middle-income countries at the end of 2021, a company spokesperson told Fierce Pharma. The firm has committed to ship a combined 900 million doses of the shot to the African Union and COVAX through 2022. It’s also in final discussions with South Africa’s Aspen Pharmacare to license the shot, the spokesperson said.
As for Pfizer, the New York pharma has pledged to deliver at least 1 billion doses of BioNTech-partnered Comirnaty each year to low- and middle-income countries through 2022. The two firms fulfilled that pledge in 2021, a Pfizer spokesperson told Fierce Pharma.
In Moderna’s case, the biotech signed on a month ago to supply up to 150 million extra doses of its COVID shot to COVAX in 2022, on top of the 500 million doses it had agreed to for 2021 and 2022. Plus, the company has a separate deal to supply 110 million doses to the African Union.
Last year, then-Johnson & Johnson CEO Alex Gorsky scored $29.58 million in total 2020 pay, ranking third among his biopharma peers. AZ’s Soriot nabbed $21.52 million and Pfizer chief Albert Bourla got $21.03 million. Moderna, with the COVID shot its only commercial product, its CEO Stephan Bancel snared $12.85 million.