Pfizer Inc.’s Ian Read was the highest-paid chief executive officer at a large pharmaceutical company last year, as U.S. top managers remained on average much better paid than their European counterparts.
New York-based Pfizer increased Read’s remuneration 2.5 percent to $25.6 million in 2012, while Novo Nordisk A/S’s Lars Rebien Soerensen was the lowest-paid CEO, with $5 million, Sam Fazeli, a London-based analyst for Bloomberg Industries, wrote in a note today. The median pay of CEOs leading large pharmaceutical companies in the U.S. was $17.2 million last year, 85 percent more than the $9.3 million European average, according to the analyst.
“Despite the fact that there’s a lot of noise in Europe” on top-management remuneration, “we’re actually paying less for management teams, by the look of 2012,” Fazeli said in a telephone interview today. “U.S. CEOs are paid more. If you want to be competitive, then you’ve got to be competitive.”
Payments to top managers in Europe are under increased scrutiny. A U.K. pension group earlier this week recommended that members vote against London-based AstraZeneca Plc’s remuneration policy at the company’s annual general meeting on April 25 to protest a “golden hello” payment and planned incentives for Chief Executive Officer Pascal Soriot.
Novartis AG met similar pressure earlier this year because of the Basel, Switzerland-based company’s plans to pay outgoing Chairman Daniel Vasella $77 million as part of a non-compete agreement. Vasella’s “golden parachute” came to light after details were leaked to the press, leading to a public outcry in Switzerland and prompting him to give up the money.
Today, shareholders of Actelion Ltd., the Swiss maker of a treatment for a rare lung disease, rejected the company’s 2012 remuneration report in a non-binding vote at the annual general meeting. Chief Executive Officer Jean-Paul Clozel earned 5.2 million Swiss francs ($5.6 million) last year, the company based in Allschwil, near Basel, said in its annual report.
Swiss voters backed curbs on executive pay in the country in a March referendum. The initiative gives shareholders an annual ballot on managers’ pay and eliminates sign-on bonuses, severance packages and extra incentives for completing merger transactions. It also includes rules punishing executives who violate the terms with time in jail. At least five of Europe’s 20 highest-paid CEOs work for Swiss companies, according to data compiled by Bloomberg.
Large-cap pharmaceutical companies paid their CEOs a median of $13.7 million in 2012, well below the industrials-company median of $21.9 million, according to Bloomberg Industries. The rankings for individuals were based on CEOs who worked the entire year.