Sector News

Investors press GSK to slash incoming CEO Walmsley's pay package

March 6, 2017
Life sciences

As incoming GlaxoSmithKline CEO Emma Walmsley gets ready to move into the company’s top spot, shareholders have some objections—and they center on her pay package.

Leading investors of the company are pressuring Glaxo’s board to pare down Walmsley’s prospective compensation. Their reasoning? It’s insufficiently lower than current chief Andrew Witty’s, Sky News reports.

According to the news service, Urs Rohner, chair of GSK’s remuneration committee, has floated a package that would grant Walmsley an annual base salary of just under £1 million—more than the £850,000 she’s been making since she was tapped last year as the company’s next leader, but slightly less than the annual £1.1 million Witty pockets each year.

Walmsley’s bonus and long-term share award potential—where pharma CEOs usually net the bulk of their compensation—would also be far less than Witty’s, sources told Sky.

Some shareholders still don’t think the figures fit Walmsley’s experience level. The future skipper, set to become Big Pharma’s first female CEO, has a resume heavily weighted toward consumer products; most recently, she ran Glaxo’s consumer health joint venture, and before joining the British drugmaker in 2010 she spent 17 years at L’Oreal.

For now, final compensation proposals haven’t been submitted, but time is running low: Glaxo’s annual report, which will include the details of Walmsley’s pay package, is due out in the latter half of this month.

The company is in “active consultations with shareholders” and is “acutely aware of the need for a balanced and responsible approach to remuneration,” a spokesperson said in a statement.

The executive pay landscape is particularly tense in the U.K. right now, with pressure on the government to close a widening wage-inequality gap. Some have called for companies to reveal more data about exec pay—including a breakdown of how much more their CEOs earn than the average worker—but Glaxo and British peer AstraZeneca last month told Bloomberg they wouldn’t.

Regardless of how much Walmsley’s package ends up totaling, the final figures will still pale in comparison to those of her U.S. counterparts. In 2015, one of biopharma’s top-paid execs—Regeneron CEO Len Schleifer—came away with $47.5 million, more than five times the £6.66 million ($8.15 million) Witty earned overall in 2015.

AstraZeneca has also faced pushback regarding its CEO pay. In 2012, the £4 million it awarded newcomer Pascal Soriot, meant to make up for a loss of long-term incentive compensation from previous employer Roche, sparked investor outcry.

By Carly Helfand

Source: Fierce Pharma

comments closed

Related News

January 29, 2023

Colorcon, Inc. signs Put agreement with intent to acquire controlled atmosphere packaging specialist Airnov Healthcare Packaging

Life sciences

Airnov provides critical healthcare industries with high-quality, controlled atmosphere packaging, to protect their products from moisture and oxygen. The business has manufacturing facilities in the USA, France, China and India and employs around 700 people.

January 29, 2023

Takeda pledges up to $1.13B for rights to Hutchmed’s cancer drug fruquintinib outside of China

Life sciences

Takeda of Japan has partnered with Hong Kong-based Hutchmed, gaining the commercial rights to colorectal cancer drug fruquintinib outside of China for $400 million up front, plus $730 million in potential milestone payments. Takeda also will help develop fruquintinib, which can be applied to subtypes of refractory metastatic colorectal cancer, regardless of biomarker status, the companies said.

January 29, 2023

Vir taps Bayer dealmaker Marianne De Backer as its next CEO

Life sciences

On April 3, Scangos, who’s been chief executive officer at Vir since the start of 2017, will hand over the reins to Marianne De Backer, Ph.D. De Backer comes over from Bayer, where she currently heads up pharmaceutical strategy, business development and licensing. Alongside her CEO appointment, De Backer is set to join Vir’s board of directors, the company said Wednesday.

How can we help you?

We're easy to reach