The US drugmaker Regeneron, whose Covid therapy was hailed as a “cure” by Donald Trump final year, has come under fire from two influential shareholder advisory teams over “excessive” payouts made to its prime executives forward of its annual meeting on Friday.
The investor advisory group Glass Lewis stated it was “highly concerned” on the New York-based agency’s resolution final year to ditch annual stock choices. Instead it would substitute them with an upfront five-year grant of performance-restricted stock items value $130m (£92m) for every of its prime two executives – Leonard Schleifer, the Regeneron chief govt, and George Yancopoulos, the chief scientific officer.
While they’re supposed to lock down executives for the following few years, Glass Lewis questioned whether or not the upfront payouts have been in the very best pursuits of shareholders. It estimates that the annualised worth of the grants is 51% increased than the earlier year’s stock choices.
Institutional Shareholder Services, one other advisory group, additionally expressed concern: “The awards are excessive in value, replace annual grants for a relatively long period of time, and provide multiple opportunities for the same shares to be earned.”
Glass Lewis famous that the company’s govt payouts had met with “substantial opposition from shareholders” lately. Together, the 2 prime bosses collected $270m in pay and bonuses final year. Schleifer was the best-paid CEO in the global pharmaceutical industry last year together with his $135m package deal.
At final year’s advisory vote on govt pay, which is held each three years, Regeneron’s plans obtained assist from 70.1% of votes cast. At the time of the meeting, Schleifer owned 16.6% of the company whereas the French drugmaker Sanofi had a 20.6% holding, which it has since sold. When these stakes are excluded, lower than 33% of votes have been cast in favour of the company’s pay plans.
Regeneron is supplying the US authorities with hundreds of thousands of doses of its Covid antibody cocktail REGEN-COV, after receiving emergency authorisation for the therapy in November. It is a mixture of two monoclonal antibodies designed to stop the coronavirus spike protein attaching to receptors within the physique, to stop Sars-CoV-2 an infection and to deal with individuals who have contracted the virus.
The share value of the Nasdaq- and London-listed company soared in early October 2020, from $564 to over $600 a share, after then-president Trump touted the therapy in a video, claiming that it had cured his Covid. The shares have risen 41% because the begin of 2020.