Two more Big Phar­ma CEOs en­joyed hefty rais­es in 2018, leav­ing the in­dus­try’s on­ly ma­jor league fe­male chief in firm con­trol of last place

By any mea­sure, Mer­ck had a big year in 2018 as its PD-1 drug cruised in­to first place for the megablock­buster check­point mar­ket. And CEO Ken Fra­zier, who start­ed the year by earn­ing head­lines for di­rect­ly re­buk­ing Pres­i­dent Don­ald Trump, was re­ward­ed with a fat, 19% hike in com­pen­sa­tion.

Ken Fra­zier

Fra­zier grabbed a pack­age worth just un­der $21 mil­lion, with $13.4 mil­lion worth of stock and op­tion awards go­ing his way to de­liv­er the goods, on top of his $1.6 mil­lion salary. His com­pen­sa­tion jumped $3.6 mil­lion, though it still fell shy of the $21.7 mil­lion earned in 2016.

That’s worth a num­ber 3 spot on the CEO com­pen­sa­tion charts.

We al­so learned from SEC fil­ings that Am­gen CEO Robert Brad­way reg­is­tered a bump in his wealth counter, weigh­ing in at a to­tal of $18.5 mil­lion, a three-year high. His $1.6 mil­lion up­siz­ing was worth a 10% hike over 2017.  Brad­way capped his year last year with an ap­proval for Aimovig, a drug he no longer wish­es to share with No­var­tis, where CEO Vas Narasimhan earned just a lit­tle more than half of what Brad­way gained.

The 2018 chart on Big Phar­ma com­pen­sa­tion is still topped by ex-Gilead CEO John Mil­li­gan’s $26 mil­lion, with GSK chief Em­ma Walm­s­ley firm­ly at the bot­tom of the list for the top 15 Big Phar­ma chiefs we track. She earned $7.7 mil­lion.

Robert Brad­way

All the CEOs’ pay fluc­tu­a­tions can the­o­ret­i­cal­ly be tied to the suc­cess or fail­ure, ul­ti­mate­ly, of their R&D groups. But in Mer­ck’s case the ex­tra largesse didn’t ex­tend in any ex­tra­or­di­nary way to Roger Perl­mut­ter, who grabbed a pack­age worth $7 mil­lion, just up 4%. 

Sean Harp­er fin­ished out his ca­reer at Am­gen with $6.8 mil­lion, which sits right in the same ball­park as Perl­mut­ter.

We’re al­most done now run­ning through the com­pen­sa­tion list for phar­ma­land’s top ex­ecs. As usu­al, the Amer­i­cans did far bet­ter than the Eu­ro­peans. And the rel­a­tive new­com­ers — like Richard Gon­za­lez and David Ricks — made up for some lost time with some of the biggest pack­ages on the list.

Over­all, it’s a good time to run a Big Phar­ma com­pa­ny, de­spite con­gres­sion­al in­ves­ti­ga­tions re­lat­ed to the on­go­ing bat­tle over drug prices, un­end­ing ques­tions about the sus­tain­abil­i­ty of a ques­tion­able R&D mod­el and so on.

Roger Perlmutter. Merck via webcast

'Our lega­cy mat­ter­s': Mer­ck maps out Keytru­da king­dom while spot­light­ing ad­vances in vac­cines, hos­pi­tal care

“You can for the mo­ment stop tak­ing notes. You can put down your pens and your pad. I have no slides. I have no sub­stan­tive da­ta. I have no pitch.”

So be­gan Roger Perl­mut­ter’s brief ap­pear­ance on­stage at Mer­ck’s first in­vestor day in five years, where he dived in­to the com­pa­ny’s his­to­ry dat­ing back to 1933. The first em­ploy­ees at Mer­ck Re­search Lab­o­ra­to­ries, hand­picked by founder George W. Mer­ck, were crit­i­cal to Mer­ck’s abil­i­ty to achieve clin­i­cal and com­mer­cial suc­cess.

Eli Casdin, Casdin Capital

Eli Cas­din backs Codex­is' plat­form tech with $50M eq­ui­ty buy

About a month af­ter Codex­is notched a deal with No­var­tis $NVS, the Cal­i­for­nia com­pa­ny $CDXS on Thurs­day said long-time in­vestor Cas­din Cap­i­tal is putting up $50 mil­lion in a pri­vate place­ment, which puts the New York-based in­vest­ment firm in con­trol of more than 5% of the pro­tein en­gi­neer­ing play­er’s stock.

Eli Cas­din start­ed his epony­mous in­vest­ment firm in 2012 and dates his re­la­tion­ship with Codex­is back to at least a decade. About three years ago, Cas­din Cap­i­tal be­gan in­vest­ing in the in­dus­tri­al biotech com­pa­ny, af­ter it piv­ot­ed its fo­cus to the life sci­ences — un­der the aus­pices of new chief John Nicols — away from the en­er­gy in­dus­try.

Ken Frazier appears before the Senate Committee on Finance for a hearing on prescription drug pricing on Capitol Hill in Washington, DC, February 26, 2019. Chris Kleponis for CNP via AP Images

Who’s next in line to suc­ceed Ken Fra­zier as CEO of the Keytru­da-blessed Mer­ck?

When Merck waved off a looming forced retirement for Ken Frazier last September, the board cited flexibility in CEO transition as a key factor in the decision. Having Frazier — who’s also chairman of the company — around beyond his 65th birthday in 2019 would ensure they install the best person at the best time, they said.

The board has evidently begun that process with a clear preference for internal candidates, sources told Bloomberg. CFO Robert Davis, chief marketing officer Michael Nally, and chief commercial officer Frank Clyburn are all in the running, according to an insider.

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Robert Forrester, Verastem

Ve­rastem CEO For­rester steps to the ex­it as the board hunts com­mer­cial-savvy ex­ec for the be­lea­guered biotech

Robert For­rester is step­ping down as CEO of Ve­rastem On­col­o­gy $VSTM just 8 months af­ter the com­pa­ny nabbed an ap­proval for du­velis­ib, a PI3K drug with a sto­ried past — and what ap­pears as not much of a fu­ture.

The biotech put out word this morn­ing that For­rester will take an ad­vi­so­ry role with Ve­rastem while COO Dan Pa­ter­son steps up to take charge of the lead­er­ship team and the board looks around for a new CEO.

How small- to mid-sized biotechs can adopt pa­tient cen­tric­i­ty in their on­col­o­gy tri­als

By Lucy Clos­sick Thom­son, Se­nior Di­rec­tor of On­col­o­gy Pro­ject Man­age­ment, Icon

Clin­i­cal tri­als in on­col­o­gy can be cost­ly and chal­leng­ing to man­age. One fac­tor that could re­duce costs and re­duce bar­ri­ers is har­ness­ing the pa­tient voice in tri­al de­sign to help ac­cel­er­ate pa­tient en­roll­ment. Now is the time to adopt pa­tient-cen­tric strate­gies that not on­ly fo­cus on pa­tient needs, but al­so can main­tain cost ef­fi­cien­cy.

In­vestors pony up $476M for the lat­est round of biotech IPOs to hit the Street

Three biotechs — and a genome se­quenc­ing play­er — have caught the lat­est tide to the Gold Coast of IPOs, round­ing out the first half of 2019 with 23 new drug de­vel­op­ers mak­ing it on Nas­daq.

Most of these com­pa­nies filed their IPOs al­most si­mul­ta­ne­ous­ly, though we’re still wait­ing on word of fel­low class­mate Bridge­Bio’s pric­ing af­ter CEO Neil Ku­mar set the terms at $14 to $16 a share on Mon­day in search of a $240 mil­lion (or so) wind­fall. If he’s suc­cess­ful, that would take the one-week haul past the $700 mil­lion mark, a fresh sign that in­vestors’ en­thu­si­asm for new­ly coined pub­lic biotechs hasn’t cooled.

John Reed at JPM 2019. Jeff Rumans for Endpoints News

Sanofi's John Reed con­tin­ues to re­or­ga­nize R&D, cut­ting 466 jobs while boost­ing can­cer, gene ther­a­py re­search

The R&D reorganization inside Sanofi is continuing, more than a year after the pharma giant brought in John Reed to head the research arm of the Paris-based company.
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In­vestor day prep at Mer­ck in­cludes a new strat­e­gy to pick up the pace on M&A — re­port

Mer­ck’s re­cent deals to buy up two bolt-on biotechs — Ti­los and Pelo­ton — weren’t an aber­ra­tion. In­stead, both ac­qui­si­tions mark a new strat­e­gy to beef up its dom­i­nant can­cer drug op­er­a­tions cen­tered on Keytru­da while look­ing to ad­dress grow­ing con­cerns that too many of its eggs are in the one I/O bas­ket for their PD-1 pro­gram. And Mer­ck is go­ing af­ter more small- and mid-sized buy­outs to calm those fears.

The top 10 block­buster drugs in the late-stage pipeline — Eval­u­ate adds 6 new ther­a­pies to heavy-hit­ter list

Vertex comes in for a substantial amount of criticism for its no-holds-barred tactical approach toward wresting the price it wants for its commercial drugs in Europe. But the flip side of that coin is a highly admired R&D and commercial operation that regularly wins kudos from analysts for their ability to engineer greater cash flow from the breakthrough drugs they create.

Both aspects needed for success in this business are on display in the program backing Vertex’s triple for cystic fibrosis. VX-659/VX-445 + Tezacaftor + Ivacaftor — it’s been whittled down to 445 now — was singled out by Evaluate Pharma as the late-stage therapy most likely to win the crown for drug sales in 5 years, with a projected peak revenue forecast of $4.3 billion.

The latest annual list, which you can see here in their latest world preview, includes a roster of some of the most closely watched development programs in biopharma. And Evaluate has added 6 must-watch experimental drugs to the top 10 as drugs fail or go on to a first approval. With apologies to the list maker, I revamped this to rank the top 10 by projected 2024 sales, instead of Evaluate's net present value rankings.

It's how we roll at Endpoints News.

Here is a quick summary of the rest of the top 10:

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