Alex Philippidis Senior News Editor Genetic Engineering & Biotechnology News
History is made—a woman is at the top of this list for the first time.
For the first time, a woman tops a list of top-compensated CEOs in biopharma. And as with the longtime leader in biopharma CEO pay, who dropped to an uncustomary second-place this year, nearly all of the top-paid CEO’s compensation in 2013 was in stock options.
Her top position on this year’s top-paid biopharma CEOs list offers another example of how big biotech has caught up and then some with big pharma when it comes to developing and marketing new drugs. It stands to reason, then, that big biotechs have become more than competitive with their pharma counterparts when it comes to compensation.
Indeed the top three highest-compensated CEOs of publicly traded biopharmas in 2013 were chief executives of biotechs that have successfully launched new treatments. Biotech CEOs hold nine of the 20 positions on this year’s updated GEN List of what top biopharma CEOs made last year, compared with eight chief executives of legacy pharmas.
Of the other three companies, one is a pharma spinout (AbbVie) while the other two are biopharmas that have grown into companies with sizeable generic as well as branded drug offerings through a flurry of acquisitions and mergers in recent years (Actavis and Endo International). A second spinout may make its way to the list next year, if Baxter International follows through with announced plans to spin out its biopharma business as part of a plan to split the drug-device giant into two separate companies.
The surge in biotech CEO pay has knocked off this year’s list one pharma CEO. John C. Lechleiter, Ph.D., the chairman, president, and CEO of Eli Lilly, finished 2013 with $11,217,000 in total compensation—down 23% from the $14,620,633 reported for him in 2012. Dr. Lechleiter’s 2013 compensation came in at 22nd and thus off this year’s Top 20 list, $147,308 below that of the No. 21 CEO, Jean-Jacques Bienaimé of BioMarin International.
Following is this year’s list, which ranks CEOs by their total 2013 compensation as disclosed in company proxy statements. Each CEO is listed by name, title, company, 2013 and 2012 total compensation, and percent change between the two years. All non-U.S. currencies have been converted to U.S. dollars.
#20. Paul M. Bisaro
Company: Actavis
Title: President and CEO
2013 total compensation: $11,381,072
2012 total compensation: $8,679,309
% Change: 31.1%
#19. Christopher Viehbacher
Company: Sanofi
Title: CEO
2013 total compensation: $11,410,779 (€8,648,326)
2012 total compensation: $9,870,733 (€7,481,151)
% Change: 15.6%
#18. David E. I. Pyott
Company: Allergan
Title: Chairman and CEO
2013 total compensation: $12,029,283
2012 total compensation: $21,164,198
% Change: -43.2%
#17. Rajiv De Silva
Company: Endo International
Title: President and CEO
2013 total compensation: $12,594,0521,2
2012 total compensation: N/A
% Change: N/A
#16. Severin Schwan
Company: Roche
Title: CEO
2013 total compensation: $13,028,987 (CHF 11,916,938)
2012 total compensation: $13,706,673 (CHF 12,537,385)
% Change: -4.9%
#15. Jeffrey M. Leiden, M.D., Ph.D.
Company: Vertex Pharmaceuticals
Title: Chairman, President, and CEO
2013 total compensation: $13,126,4743
2012 total compensation: $5,656,6844
% Change: 132.1%
#14. Kenneth C. Frazier
Company: Merck & Co.
Title: Chairman, President, and CEO
2013 total compensation: $13,375,935
2012 total compensation: $15,459,607
% Change: -13.5%
#13. Leonard Bell, M.D.
Company: Alexion
Title: CEO and Treasurer
2013 total compensation: $13,388,704
2012 total compensation: $13,599,451
% Change: -1.5%
#12. Robert A. Bradway
Company: Amgen
Title: Chairman, CEO, and President
2013 total compensation: $13,649,8075
2012 total compensation: $13,570,0915
% Change: 0.6%
#11. Joseph Jimenez
Company: Novartis
Title: CEO
2013 total compensation: $14,404,700 (CHF 13,226,287)
2012 total compensation: $14,407,342 (CHF 13,228,188)
% Change: -00.0002%
#10. George A. Scangos
Company: Biogen Idec
Title: CEO
2013 total compensation: $15,015,147
2012 total compensation: $13,451,802
% Change: 11.6%
#9. John C. Martin
Company: Gilead Sciences
Title: Chairman and CEO
2013 total compensation: $15,451,862
2012 total compensation: $15,257,272
% Change: 1.3%
#8. Robert L. Parkinson, Jr.
Company: Baxter International
Title: Chairman and CEO
2013 total compensation: $16,162,128
2012 total compensation: $17,521,770
% Change: -7.8%
#7. Alex Gorsky
Company: Johnson & Johnson
Title: Chairman and CEO
2013 total compensation: $16,910,960
2012 total compensation: $10,977,1096
% Change: 54.1%
#6. Richard A. Gonzalez
Company: AbbVie
Title: Chairman and CEO
2013 total compensation: $18,176,7947
2012 total compensation: $7,949,2178
% Change: 128.7%
#5. Ian C. Read
Company: Pfizer
Title: Chairman and CEO
2013 total compensation: $18,947,747
2012 total compensation: $25,634,136
% Change: -26.1%
#4. Lamberto Andreotti
Company: Bristol-Myers Squibb
Title: CEO
2013 total compensation: $20,847,746
2012 total compensation: $17,201,980
% Change: 21.2%
#3. Robert J. Hugin
Company: Celgene
Title: CEO, President, and Chairman
2013 total compensation: $20,995,785
2012 total compensation: $10,574,022
% Change: 98.6%
#2. Leonard S. Schleifer, M.D., Ph.D.
Company: Regeneron
Title: President and CEO
2013 total compensation: $36,272,6659
2012 total compensation: $30,047,097
% Change: 20.7%
#1. Martine Rothblatt, Ph.D., J.D., M.B.A.
Company: United Therapeutics
Title: Chairman and CEO
2013 total compensation: $38,218,25510,11
2012 total compensation: $7,958,32811
% Change: 380.2%
Notes:
1 De Silva joined the company as its president and CEO on March 18, 2013, succeeding David P. Holveck, who retired effective March 15, 2013.
2 Compensation includes a $3.5 million discretionary bonus approved by the company’s board of directors on February 26, 2014. According to the company’s 2014 proxy statement, the bonus was awarded “in recognition of Mr. De Silva’s leadership in driving shareholder value through the development and execution of a transformational long-term vision and strategy for the company that included the restructuring of the business into a leaner operating model, the pursuit and execution of value-creating accretive transactions, sharpening the R&D focus on late stage assets, optimizing the capital structure of the company, and strengthening the organization and talent.”
3 Includes $2,772,000 recorded as “Non-Equity Incentive Plan Compensation” and consisting of a performance cash bonus for 2013.
4 Dr. Leiden has served as CEO and president since February 2012, and has been chairman of the company’s board of directors since May 2012.
5 Became president and CEO on May 23, 2012, and took on the additional position as chairman on January 1, 2013.
6 Became CEO on April 26, 2012 and took the additional position of chairman on December 28, 2012.
7 In its 2014 proxy, AbbVie said the higher 2013 total compensation reflected Gonzalez’ exceeding five financial goals among other benchmarks for 2013: adjusted diluted earnings per share, sales, adjusted income before taxes, adjusted return on assets, and adjusted return on equity.
8 Gonzalez’ 2012 compensation reflected his position as executive vp of the Pharmaceutical products group of Abbott Laboratories, from which AbbVie was spun out on January 2, 2013.
9 91.1% of Dr. Schleifer’s compensation, $33,062,325, consisted of option awards, the second highest percentage among CEOs ranked on this list. Dr. Schleifer was also awarded a one-time $2.3 million bonus to reflect company’s exceeding its 2012 goals.
10 94.5% of Dr. Rothblatt’s total compensation in 2013, $36,097,326, reflected stock options— the highest percentage of any CEO on the list. She is eligible to receive an annual award of options to purchase the number of shares of common stock equal to 0.18% of the increase in the company’s market capitalization each year, based on the average closing price of common stock for December. According to the company’s 2014 proxy statement: “The increase in our CEO’s compensation between 2012 and 2013 was primarily due the stock option grant our CEO received in 2013 (covering 1,000,000 shares) pursuant to the performance-based formula set forth in her employment agreement, compared to the grant of only 153,225 stock options she received pursuant to the same formula in 2012. In addition, the fair value of the 2013 option grant was determined at the time our stock price was at nearly an all-time high, and more than twice the stock price at the time of the 2012 option grant.” (The company’s stock price more than doubled during 2013, rising 112%.)
11 The company’s Canadian subsidiary pays a portion of Dr. Rothblatt’s total base salary, in the amount of C$120,000. The subsidiary paid the equivalent of $116,472 in 2013, and $120,179 in 2012.
