The $913M bonanza: Arie Belldegrun and his top team at Kite show you how to make a really rich deal
When David Hung finished his deal to sell Medivation to Pfizer for $14 billion, he reaped a $355 million windfall as his reward as the master dealmaker in the industry. But if you think that’s a lot, you don’t know Arie Belldegrun.
Earlier this week, Kite Pharma laid out the rewards that fall to their executive team in light of the landmark $12 billion deal that they did with Gilead. And Belldegrun and his key team just illustrated how richly biotech can be rewarded when you make an historic advance in the clinic.
Add up Belldegrun’s payoffs for the shares he owned, plus a reward on vested and unvested shares and a mother lode in golden parachute rewards, and the total revealed in the SEC filing hits $694,266,006, with tax reimbursements on top.
Broken down, that looks like this:
$17,370,398 vested shares
$33,272,896 unvested shares
$64,414,032 golden parachute
But Belldegrun didn’t just make himself phenomenally wealthy from the deal. His executive team, led by COO Cynthia Buttita and R&D chief David Chang, are also independently wealthy now.
Buttita, who held on to $14.2 million in stock at the time of the buyout, is gathering a total of $121 million — including vested and unvested stock, plus a $39 million golden parachute package.
Chang had less stock, but he still gets a package worth $98 million, including a $37 million golden parachute windfall.
Altogether for those three: $913 million.
Biotech, of course, is one of the riskiest businesses in the world, as the executives at Juno would surely tell you. Instead of coming out in the front of the CAR-T competition, they’re now playing catch-up. Hung himself just watched an option on a new personal fortune as well as $2 billion in market cap just go up in smoke with the crushing failure of Axovant’s lead Alzheimer’s drug, so there are plenty of losses to consider when calculating the winnings for any deal. But few can ignore the lesson that winning big in biotech can be worth a mother lode of cash — which is one reason why billions of dollars flow into drug development.
It’s also been suggested to me that coming out in the front of these R&D races isn’t all that important.
But that may depend on how you keep score.