We’re all used to seeing Big Pharma CEOs take home the biggest pay packets, but after a relaxing of listing rules in Hong Kong, we’re seeing some very early-stage biotechs handing out some major and even comparable checks to their leaders.
Last year, Ken Frazier, CEO and chair of Big Pharma Merck, a consistent top 10 revenue earner across all pharmas, got a very healthy $20.9 million in total compensation. That’s a huge wage but one you’d expect from a CEO leading one of pharma’s, and indeed the world’s, biggest companies, raking in nearly $43 billion in sales a year.
So, you might expect that the CEO of a much, much smaller startup, which isn’t even making money yet, to make a fraction of that.
Not so: We learned from data compiled by S&P Global Market Intelligence out this week that the total reported compensation of Jiang Ningjun, the CEO of CStone Pharmaceuticals, was a staggering 141.25 million yuan (just under $20 million) last year, putting him on par with Frazier.
But then, CStone has been impressive with its funding drive: Back in 2016, it got off a major $150 million series A round, and last year it was in the top 10 biggest funding rounds for all biotechs, taking in a $260 million series B.
Back in February, the biotech picked up another HK$2.1 billion ($266 million) when it went public on the Hong Kong Stock Exchange, which relaxed its rules for early-stage, prerevenue biotechs in 2018 and has allowed us to see CEOs’ pay packets.
And it’s not just CStone: The paychecks of all the CEOs on the Hong Kong list more than doubled last year, according to its report, with many not too far off from what U.S. pharma CEOs can expect.
Alexander Krasavin, partner and chief commercial officer for human capital solutions for the Asia Pacific and Middle East regions at consultancy Aon, told S&P that this shouldn’t be too much of a shock given that Chinese biotech companies “tend to use remuneration paid to U.S. executives in the sector as a benchmark to decide on what they pay their own executives.”
He added: “CEOs of precommercial biotech companies globally are compensated based on the future value of the company that they are expected to deliver through their leadership.
“Whether or not the executive’s compensation is sustainable is determined by how confident the company’s shareholders and board of directors are of the executive’s ability to deliver that value.”
By Ben Adams
Source: Fierce Biotech
Giovanni Caforio, the former CEO of Bristol Myers Squibb, is set to become the next board chairman of Novartis, which on Tuesday proposed the pharmaceutical industry veteran as its pick to replace Joerg Reinhardt in the role next year. Reinhardt has served as Novartis’ chair since 2013 and plans to retire when his 12-year term ends in 2025.
GE HealthCare has raised the curtain on two ultrasound systems equipped with artificial intelligence programs designed to assist in diagnosing conditions in women’s health, including obstetric exams. The Voluson Signature 20 and 18 imaging systems include AI tools capable of automatically identifying and annotating measurements of fetal anatomy.
Scientists from the University of Edinburgh’s School of Chemistry have revealed a new sustainable method of manufacturing complex molecules that could reduce waste produced during drug production. The method published in Nature Chemistry could help to prevent severe side effects caused by drugs that can exist as enantiomers.
