Valeant CEO Joseph Papa’s 2017 paycheck looked a little bit different from his 2016 version.
After picking up a cool $62.7 million in 2016—most of which was equity that’ll pay off down the line—Papa racked up (PDF) just $4.9 million last year. And the difference wasn't just equity. In addition to the missing $42 million in stock awards and $10 million in option awards, 2017’s tally also lacked the previous year’s $9.1 million bonus.
Of course, Valeant awarded Papa $8 million of that 2016 bonus just for signing on to lead the debt-ridden, scandal-plagued company in the first place. The rest, though, was a present for his performance, despite the fact that the company missed its financial targets under his guidance.
For 2017? No such thing. Valeant scrapped discretionary bonuses in response to investor feedback, it said, keeping any for 2017 performance “strictly formulaic.”
And that wasn’t the only change the Canadian drugmaker made to its executive compensation program. In a presentation (PDF), it highlighted other efforts it’s taking to incorporate shareholder feedback, and the company intends to keep responding to investor concerns, it said.
Case in point: Investors have suggested that Papa’s long-term incentive program should match the awards granted to the rest of the executive team, and for 2018, they’ll be “similar” and reflect the same performance share unit metrics.
Meanwhile, Papa did net a new $3 million in incentive pay, as well as a base salary bump to $1.5 million from $980,769. But other compensation—a category that includes 401(k) matching and personal use of the company aircraft—fell by more than $200,000 to $413,858.
Valeant was quick to point to its 2017 accomplishments, trumpeting its $6.7 billion in debt reduction and its success in combating management team and sales force turnover. Still, shares—which hovered around the $15.20 mark late Monday morning—are far, far below the $250-plus heights they saw in the summer of 2015.