It’s a good time to be the top dog at a pharma company. Every year, Securities and Exchange Commission filings reveal just how much companies are willing to reward their CEOs and in healthcare, the answer is — quite a bit.
Of course, lucrative compensation packages for CEOs are certainly not unique to pharma. In fact, they often pale in comparison to CEO pay in other industries. For example, the No. 1 CEO salary in the U.S. belongs to Elon Musk of Tesla who raked in $513 million last year — versus $58.6 million for the top pay in pharma.
But if you now factor cannabis into the landscape — which is not considered “pharma” but is certainly strengthening its bonds with the industry — it’s a slightly different story. Last year the No. 2 CEO salary ($256 million) belonged to Brendan Kennedy at Tilray, one of the world’s biggest medical and recreational marijuana companies. Tilray also became the first cannabis cultivator to strike a major partnership with Big Pharma last year when it inked a deal with Sandoz.
And of course, salaries also don’t tell the whole story of what CEOs make. For example, Jeff Bezos, head of Amazon and the richest man in the world, has maintained a salary of about $81,840 for about 20 years. But because he owns about 16 percent of Amazon’s stock, Bezos is worth well over $150 billion.
Meanwhile in pharma, several of the industry’s top execs, who also often own stock options far larger than their salaries, won massive pay increases between 2017 and 2018. Among pharma’s top 20 paid CEOs, several saw their pay packages increase by over 100 percent last year including Stephane Bancel of Moderna who got a whopping 761 percent bump, bluebird bio’s Nick Leschly (176 percent increase), BeiGene’s John Oyler (170 percent), and Seattle Genetics’ Clay Siegall (110 percent).
And interestingly in pharma, the biggest CEO paychecks were also not necessarily at the largest companies with the most revenue. Here’s a look at the top 10 from 2018:
Stephane Bancel, Moderna Therapeutics — $58.6 million
In Dec. 2018, Moderna, which specializes in messenger RNA therapeutics, set a record for having the biggest IPO in biotech history. The early investor success helped Bancel draw in major rewards including a hefty pay increase from $6.80 million in 2017 to $58.6 million last year.
Kare Schultz, Teva Pharmaceuticals — $32.5 million
A large signing bonus helped propel Schultz to the top of this list after he decided to take over Teva, which was still reeling from declining revenue and layoffs, in late 2017.
John Oyler, BeiGene — $27.9 million
With its portfolio of immunotherapy and small molecule targeted therapies for cancer, BeiGene is one of China’s leading biotech companies, which has helped turned Oyler, an American entrepreneur who helped launch the company, into a billionaire.
Leonard Schleifer, Regeneron — $26.5 million
After co-founding Regeneron in 1988, Schleifer has stayed at its helm and partly thanks to the stock he owns in the company, is one of the wealthiest CEOs in pharma.
John Milligan, Gilead Sciences — $26 million
In his last year at Gilead — Milligan stepped down in July after 28 years — the company awarded the CEO with a compensation package up nearly 70 percent from 2017.
Nick Leschly, bluebird bio — $24 million
Bluebird bio has only one treatment approved — a gene therapy for a rare blood disorder that has gotten the OK in the EU. But the treatment is likely to become the second most costly therapy in the world and bluebird has bet big on its chief’s ability to steer the company towards a successful and profitable rollout in the U.S. as well.
Richard Gonzalez, AbbVie — $21.27 million
Part of Gonzalez’s pay package is tied to sales of Humira, which is still the world’s best-selling drug, and has helped preserve his place as one of the highest paid CEOs in pharma.
Kenneth Frazier, Merck — $20.9 million
Frazier has already announced his retirement from the top spot at Merck and the company is preparing for his replacement. But in the meantime, it has given a hefty compensation package to Frazier, who presided over a period of high-growth at Merck that was propelled by the launch of its blockbuster drug, Keytruda.
Alex Gorsky, Johnson & Johnson — $20 million
Gorsky’s overall pay dropped last year, and the company is facing a difficult year ahead as it stares down patent expirations and multiple lawsuits related to its involvement in opioid manufacturing as well as accusations that its talc baby powder causes cancer.
Paul Campanelli, Endo — $19.9 million
Endo is also facing a torrent of opioid-related lawsuits along with declining revenues from downward pricing pressure in the generics market. But the company awarded its CEO with a pay bump in 2018, part of which came from a signing bonus from when Campanelli took the job in 2017.