Lousy year for share­hold­ers, but Al­ler­gan CEO Brent Saun­ders sprints past Gorsky, Gon­za­lez with $32M pay pack­age

Brent Saun­ders’ H2 2017 strat­e­gy to pre­serve con­trol of the Resta­sis patents may be un­der as­sault from every an­gle, forc­ing the com­pa­ny to re­struc­ture ahead of the like­ly loss of its lu­cra­tive fran­chise, but that didn’t stop Al­ler­gan CEO Brent Saun­ders from pick­ing up a huge hike in com­pen­sa­tion for the year.

The com­pa­ny’s proxy state­ment shows Saun­ders took home a pay pack­et worth $32.8 mil­lion — about 8 times what he earned the year be­fore. And with a raft of new SEC fil­ings to­day, it’s clear that Saun­ders scored high rel­a­tive to the ex­ecs in charge of much, much larg­er phar­ma com­pa­nies with a bet­ter track record on share val­ue.

J&J CEO Alex Gorsky got a com­pen­sa­tion pack­age worth $29.8 mil­lion for 2017, build­ing on a $1.6 mil­lion base salary that re­mained flat. In 2016 Gorsky’s com­pen­sa­tion was $26.9 mil­lion. His CSO, Paul Stof­fels, bagged a pack­et worth $13.6 mil­lion, up from $12.7 mil­lion. The $JNJ stock went from $113.85 to $138.18 in the year.

Richard Gon­za­lez had a ban­ner year at Ab­b­Vie $AB­BV, but kept his pay hike to a small amount. His com­pen­sa­tion amount­ed to $22.6 mil­lion, up from $21 mil­lion. R&D chief Michael Sev­eri­no came in at $8.4 mil­lion, up from $7.2 mil­lion. The stock soared, al­most dou­bling from $61.11 to $112.22.

Saun­ders isn’t the on­ly biotech CEO mak­ing out af­ter a down year on the mar­ket. Hervé Hop­penot, the CEO at In­cyte $IN­CY, just re­port­ed that he scored a $16 mil­lion pay pack­et, up from $11.8 mil­lion in 2016 and a rel­a­tive­ly mea­ger $6 mil­lion in 2015.

In con­trast, Reid Hu­ber, his CSO, earned a slight­ly less amount than the year be­fore, hov­er­ing at $4 mil­lion. In­cyte’s stock start­ed 2017 at $121.21 and end­ed the year at $90.29 — a 25% drop.

Maria Tere­sa Hi­la­do

Much of Saun­ders’ com­pen­sa­tion came in the form of a $22.7 mil­lion stock award, far more than his $1.2 mil­lion in pay — which went up more than 20% over 2016. Saun­ders al­so picked up a bonus worth more than $8 mil­lion for some longterm goals around the 2014 merg­er deal that made Al­ler­gan $AGN in­to the com­pa­ny it is to­day. And his whole ex­ec­u­tive team ben­e­fit­ed as well.

  • CFO Maria Tere­sa Hi­la­do earned $10.7 mil­lion in com­pen­sa­tion, up from $1.2 mil­lion.
  • CCO William Meury bagged $11 mil­lion, up from $1.7 mil­lion.
  • R&D chief David Nichol­son al­so brought home a pack­et worth $11 mil­lion, up from $1.7 mil­lion.
  • And for­mer COO Robert Stew­art got $9.4 mil­lion, up from $1.5 mil­lion.

As a team, their com­pen­sa­tion soared from $11.8 mil­lion to $74.9 mil­lion — a 634% year over year in­crease.

Share­hold­ers didn’t make out so well dur­ing that pe­ri­od. Al­ler­gan’s stock de­clined from $218.89 to $180.26 over that pe­ri­od, and is cur­rent­ly trad­ing at $163.19 in a chop­py mar­ket. And Al­ler­gan has had a mixed record on the pipeline front, with few M&A deals ex­pect­ed this year to pump up an­a­lysts.

The rank and file at the com­pa­ny, mean­while, was forced to un­der­go a re­vamp. The biotech laid off more than 1,000 and elim­i­nat­ed 400 open jobs at the be­gin­ning of this year to po­si­tion it­self for the blow that will ar­rive when Resta­sis los­es patent pro­tec­tion soon. Saun­ders and his team had hoped that hand­ing the patents over to a Mo­hawk tribe — which then claimed sov­er­eign im­mu­ni­ty to in­ter partes re­view — would help guard the block­buster. That cost close to $14 mil­lion in an up­front. In­stead, it’s been dissed by the courts and like­ly wouldn’t have worked in any case, giv­en the patent re­view process that ex­ists for drug mak­ers.

A group of Sen­a­tors added in­sult to in­jury re­cent­ly by in­tro­duc­ing a bill that would make it im­pos­si­ble for any­one else to even try this ap­proach.


Im­age: Al­ler­gan CEO Brent Saun­ders.

UP­DAT­ED: In sur­prise switch, Bris­tol-My­ers is sell­ing off block­buster Ote­zla, promis­ing to com­plete Cel­gene ac­qui­si­tion — just lat­er

Apart from revealing its checkpoint inhibitor Opdivo blew a big liver cancer study on Monday, Bristol-Myers Squibb said its plans to swallow Celgene will require the sale of blockbuster psoriasis treatment Otezla to keep the Federal Trade Commission (FTC) at bay.

The announcement — which has potentially delayed the completion of the takeover to early 2020 — irked investors, triggering the New York-based drugmaker’s shares to tumble Monday morning in premarket trading.

Celgene’s Otezla, approved in 2014 for psoriasis and psoriatic arthritis, is a rising star. It generated global sales of $1.6 billion last year, up from the nearly $1.3 billion in 2017. Apart from the partial overlap of Bristol-Myers injectable Orencia, the company’s rival oral TYK2 psoriasis drug is in late-stage development, after the firm posted encouraging mid-stage data on the drug, BMS-986165, last fall. With Monday’s decision, it appears Bristol-Myers is favoring its experimental drug, and discounting Otezla’s future.

The move blindsided some analysts. Credit Suisse’s Vamil Divan noted just days ago:

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Novotech CEO Dr. John Moller

Novotech CRO Award­ed Frost & Sul­li­van Best Biotech CRO Asia-Pa­cif­ic 2019

Known in the in­dus­try as the Asia-Pa­cif­ic CRO, Novotech is now lead CRO ser­vices provider for the grow­ing num­ber of in­ter­na­tion­al biotechs se­lect­ing the re­gion for their stud­ies.

Re­flect­ing this Asia-Pa­cif­ic growth, Novotech staff num­bers are up 20% since De­cem­ber 2018 to 600 in-house clin­i­cal re­search peo­ple across a full range of ser­vices, across the re­gion.

Novotech’s ca­pa­bil­i­ties have been rec­og­nized by an­a­lysts like Frost & Sul­li­van, most re­cent­ly with the pres­ti­gious Asia-Pa­cif­ic CRO Biotech of the year award for best prac­tices in clin­i­cal re­search for biotechs for the fifth year. See oth­er awards here.

Suf­fer­ing No­var­tis part­ner Cona­tus is pack­ing it in on NASH af­ter a se­ries of un­for­tu­nate tri­al events

The NASH par­ty is over at No­var­tis-backed Cona­tus. And this time they’re turn­ing off the lights.

More than 2 years af­ter No­var­tis sur­prised the biotech in­vest­ment com­mu­ni­ty with its $50 mil­lion up­front and promise of R&D sup­port to part­ner with the lit­tle biotech on NASH — ig­nit­ing a light­ning strike for the share price — Cona­tus $CNAT is back with the lat­est bit­ter tale to tell about em­ri­c­as­an, which once in­spired con­fi­dence at the phar­ma gi­ant.

Fol­low­ing news of job cuts in Eu­ro­pean R&D ops, Sanofi con­firms it’s of­fer­ing US work­ers an 'ear­ly ex­it'

Ear­li­er in the week we learned that Sanofi was bring­ing out the bud­get ax to trim 466 R&D jobs in Eu­rope, re­tool­ing its ap­proach to car­dio as re­search chief John Reed beefed up their work in can­cer and gene ther­a­pies. And we’re end­ing the week with news that the phar­ma gi­ant has al­so been qui­et­ly re­duc­ing staff in the US, tar­get­ing hun­dreds of jobs as the com­pa­ny push­es vol­un­tary buy­outs with a fo­cus on R&D sup­port ser­vices.

Bet­ter than Am­bi­en? Min­er­va soars on PhI­Ib up­date on sel­torex­ant for in­som­nia

A month af­ter roil­ing in­vestors with what skep­tics dis­missed as cher­ry pick­ing of its de­pres­sion da­ta, Min­er­va is back with a clean slate of da­ta from its Phase IIb in­som­nia tri­al.

In a de­tailed up­date, the Waltham, MA-based biotech said sel­torex­ant (MIN-202) hit both the pri­ma­ry and sev­er­al sec­ondary end­points, ef­fec­tive­ly im­prov­ing sleep in­duc­tion and pro­long­ing sleep du­ra­tion. In­ves­ti­ga­tors made a point to note that the ef­fects were con­sis­tent across the adult and el­der­ly pop­u­la­tions, with the lat­ter more prone to the sleep dis­or­der.

Gene ther­a­py biotech sees its stock rock­et high­er on promis­ing re­sults for rare cas­es of but­ter­fly dis­ease

Shares of Krys­tal Biotech took off this morn­ing $KRYS af­ter the lit­tle biotech re­port­ed promis­ing re­sults from its gene ther­a­py to treat a rare skin dis­ease called epi­der­mol­y­sis bul­losa.

Fo­cus­ing on an up­date with 4 new pa­tients, re­searchers spot­light­ed the suc­cess of KB103 in clos­ing some stub­born wounds. Krys­tal says that of 4 re­cur­ring and 2 chron­ic skin wounds treat­ed with the gene ther­a­py, the KB103 group saw the clo­sure of 5. The 6th — a chron­ic wound, de­fined as a wound that had re­mained open for more than 12 weeks — was par­tial­ly closed. That brings the to­tal so far to 8 treat­ed wounds, with 7 clo­sures.

Ab­b­Vie gets a green light to re­sume re­cruit­ing pa­tients for one myelo­ma study — but Ven­clex­ta re­mains un­der a cloud

Three months af­ter reg­u­la­tors at the FDA forced Ab­b­Vie to halt en­rolling pa­tients in its tri­als of a com­bi­na­tion us­ing Ven­clex­ta (vene­to­clax) to treat drug-re­sis­tant cas­es of mul­ti­ple myelo­ma, the agency has green-light­ed the re­sump­tion of one of those stud­ies, while keep­ing the rest on the side­lines.

The CANO­VA (M13-494) study can now get back in busi­ness re­cruit­ing pa­tients to test the drug for a pop­u­la­tion that shares a par­tic­u­lar ge­net­ic bio­mark­er. To get that per­mis­sion, Ab­b­Vie — which is part­nered with Roche on this pro­gram — was forced to re­vise the pro­to­col, mak­ing un­spec­i­fied changes in­volv­ing risk mit­i­ga­tion mea­sures, pro­to­col-spec­i­fied guide­lines and an up­dat­ed fu­til­i­ty cri­te­ria.

Bris­tol-My­ers star Op­di­vo fails sur­vival test in a matchup with Nex­avar aimed at shak­ing up the big HCC mar­ket

Bris­tol-My­ers Squibb has suf­fered an­oth­er painful set­back in its years-long quest to ex­pand the reach of Op­di­vo. The phar­ma gi­ant this morn­ing not­ed that their Check­mate-459 study com­par­ing Op­di­vo with Bay­er’s Nex­avar in front­line cas­es of he­pa­to­cel­lu­lar car­ci­no­ma — the most com­mon form of liv­er can­cer — failed to hit the pri­ma­ry end­point on over­all sur­vival.

This was a sig­nif­i­cant mile­stone in Bris­tol-My­ers’ tal­ly of PD-1 cat­a­lysts this year. Nex­avar (so­rafenib) has been the stan­dard of care in front­line HCC for the past decade, though Op­di­vo has been mak­ing head­way in sec­ond-line HCC cas­es, where it’s go­ing toe-to-toe with Bay­er’s Sti­var­ga (re­go­rafenib) af­ter re­cent ap­provals shook up the mar­ket.

Dean Hum. Nasdaq via YouTube

Gen­fit goes to Chi­na with a deal worth up to $228M for NASH drug

Fresh off the high of its Nas­daq IPO de­but, and the low of com­par­isons to Cymabay — whose NASH drug re­cent­ly stum­bled — Gen­fit on Mon­day un­veiled an up to $228 mil­lion deal with transpa­cif­ic biotech Terns Phar­ma­ceu­ti­cals to de­vel­op its flag­ship ex­per­i­men­tal liv­er drug — elafi­bra­nor — in Greater Chi­na.

The deal comes more than a week af­ter Gen­fit $GN­FT is­sued a fiery de­fense of its dual PPAR ag­o­nist elafi­bra­nor, when com­peti­tor Cymabay’s PPARδ ag­o­nist, se­ladel­par, fiz­zled in a snap­shot of da­ta from an on­go­ing mid-stage tri­al. The main goal at the end of 12 weeks was for se­ladel­par to in­duce a sta­tis­ti­cal­ly sig­nif­i­cant im­prove­ment in liv­er fat con­tent, but da­ta showed that pa­tients on the place­bo ac­tu­al­ly per­formed bet­ter.