Moderna CEO’s golden parachute soared by hundreds of millions during pandemic

Stephane Bancel, CEO of Moderna

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Moderna’s board approved a golden parachute for CEO Stephane Bancel worth more than $926 million at the end of last year, up from $9.4 million in 2019 before Covid-19. 19 does not upset the world order.

The value of Bancel’s so-called change-of-control package has fluctuated because much of it, $922.5 million, is in the biotech company’s stock, which has fluctuated widely over the course of the year. pandemic with society’s progress in making a vaccine to fight it. Bancel’s exit package also includes a $1.5 million cash severance package and a $2.5 million bonus if the business is sold and he is fired.

Moderna shares hit a record high of $497.49 on Aug. 10, shortly before the Food and Drug Administration authorized booster shots of its blockbuster Covid vaccine for vulnerable people. But they were trading at $253.98 on Dec. 31 when the package was priced and have since fallen about 45% to around $140 per share this week.

Even at this reduced share price, his exit package – which only becomes a reality if the company is sold and he loses his job – is breathtaking. Moderna did not return requests for comment.

The value of the golden parachute was disclosed Wednesday in the company’s annual proxy report which details the compensation of the company’s highest-paid executives. The filing shows the rewards for executives at the young biotech company where most of the compensation is rooted in the firm’s volatile equity.

His total awarded compensation for 2021 was $18.2 million, a 41% increase over 2020. Bancel’s compensation last year included $15 million in stock and options as well as a $1 bonus. $.5 million on top of his salary of $990,385. Moderna spent an additional $661,000 to provide personal security for Bancel and his family last year.

Moderna Chairman Stephen Hoge’s total compensation was a fraction of his other awards. He cashed in $165.9 million in stock options in 2021 on top of his regular compensation. Technical director Juan Andres also cashed in $194.3 million in options, outside of his usual salary.

Moderna, which was little known outside of biotech circles before the pandemic, had a blockbuster in 2021. The biotech company swung into profitability on the back of the success of its vaccine for the first time last year. Moderna reported net income of $12.2 billion after posting a loss of $747 million in 2020. Moderna’s share price soared 143% in 2021 as the company successfully rolled out its Two-dose Covid vaccine.

The vaccine remains Moderna’s only commercially available product, although the company is also developing vaccines to fight influenza and other infectious diseases. Moderna sold $17.7 billion of its shots in 2021, accounting for nearly all of the company’s revenue. Moderna forecasts sales of $19 billion for 2022 based on signed sales agreements with governments around the world.

Hoge’s total compensation of $7.8 million includes stock awards and options totaling $6 million and a bonus of $819,000 in addition to his salary. Hoge’s total compensation is a 48% increase from 2020.

Andres received a total salary of $6.6 million, including $5 million in stock and options as well as a bonus of $756,000 on top of his salary. His total compensation has increased by 55% in 2020.

Chief Financial Officer David Meline received a total salary of $5.2 million, including $4 million in stock and options as well as a bonus of $560,000 on top of his salary. Meline’s total compensation fell 44% from 2020.

Moderna fired its commercial director Corinne Le Goff last year. The company, in its proxy statement, said it was looking for someone with more experience in consumer health. Le Goff received a severance package of $1 million.

Moderna has come under heavy criticism from activist groups such as Oxfam for profiting from the vaccine while not doing more to share its technology with poorer countries. Oxfam America, which owns 376 shares of Moderna common stock, has filed a proposal for the annual shareholder meeting to assess the feasibility of transferring the biotech company’s intellectual property to boost vaccine production in developing countries. . Moderna is holding its meeting on April 28.

“We believe Moderna’s response to not sharing the information needed to manufacture its vaccine in low- and middle-income countries could tarnish its reputation, threaten its social license to operate, and undermine relationships with the U.S. government,” indicates Oxfam’s proposal.

Moderna’s board called on shareholders to vote against the proposal. The council, in its rebuttal, argued that Oxfam’s recommendation would negatively impact the safety and quality of the vaccine as well as long-term confidence in the messenger RNA technology used by the injections.

Moderna is currently locked in a patent dispute with the National Institutes of Health, which helped develop the vaccine, over the technology behind the injections. White House chief medical adviser Dr. Anthony Fauci, in a call with reporters last week, suggested the NIH would license the technology globally if it won the dispute with Moderna.

Moderna’s board said the company had agreed to provide 650 million doses to Covax, an international alliance that promotes greater access to Covid vaccination in low- and middle-income countries. Moderna also said it would not enforce its Covid-related patents during the pandemic. The biotech company has also reached a preliminary agreement with Kenya to build vaccine production in the East African country to support immunization in Africa.

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