Moderna CEO Stephane Bancel
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Moderna’s board of directors approved a gold parachute for CEO Stéphane Bansel worth more than $926 million late last year, up from $9.4 million in 2019, before Covid-19 upended the world order.
The cost of Bancel’s so-called management change package has fluctuated as most of it, $922.5 million, is in the biotech company’s stock, which has fluctuated wildly over the course of the pandemic along with the company’s progress on a vaccine. fight with it. Bansel’s exit package also includes a $1.5 million cash severance package and a $2.5 million bonus if the company is sold and he is fired.
Moderna’s stock hit an all-time high of $497.49 on August 10, just before the Food and Drug Administration approved boosters for its blockbuster Covid vaccine for vulnerable people. But on Dec. 31, when the package was priced, they traded at $253.98 and have since fallen about 45% to $140 a 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 mind-blowing. Moderna did not respond to requests for comment.
The value of the “golden parachute” was revealed on Wednesday in the company’s annual white paper, which details compensation packages for the company’s highest-paid executives. The application shows compensation for the executives of a young biotech company, where most of the salary is associated with the company’s volatile capital.
His total compensation awarded for 2021 was $18.2 million, up 41% from 2020. Bancel’s compensation last year included $15 million in stocks and options, as well as a $1.5 million bonus on top of his $990,385 salary. Last year, Moderna spent an additional $661,000 to ensure the personal safety of Bancel and his family.
Moderna President Stephen Hodge’s total compensation represents only a fraction of his other awards. In 2021, he cashed out $165.9 million worth of stock options in addition to his regular compensation. CTO Juan Andres also cashed out $194.3 million in options on top of his regular salary.
Little known outside of biotech circles before the pandemic, Moderna had a blockbuster in 2021. The biotech company turned a profit for the first time thanks to the success of its vaccine last year. Moderna posted a net income of $12.2 billion after reporting a $747 million loss in 2020. Moderna’s share price is up 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 the flu and other infectious diseases. In 2021, Moderna sold $17.7 billion worth of its shots, which is virtually 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 shares and options totaling $6 million, plus an $819,000 bonus on top of his salary. Hoge’s total compensation has increased by 48% compared to 2020.
Andres received $6.6 million in total wages, with $5 million in stocks and options, and a $756,000 bonus on top of his salary. His overall compensation is up 55% compared to 2020.
CFO David Melin received $5.2 million in total wages, including $4 million in stock and options, and a $560,000 bonus on top of his salary. Melin’s total compensation has dropped 44% compared to 2020.
Moderna fired commercial director Corinne Le Goff last year. The company, in its trusted report, said it was looking for someone with extensive experience in consumer health. Le Goff received a $1 million severance package.
Moderna has been heavily criticized by activist groups like Oxfam for profiting from the vaccine but 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 an annual shareholder meeting to evaluate the possibility of transferring intellectual property to a biotech company to increase vaccine production in developing countries. Moderna holds its meeting on 28 April.
“We believe that Moderna’s backlash against not sharing the information it needs to produce its vaccine in low- and middle-income countries could tarnish its reputation, jeopardize its social license to operate, and undermine relations with by the US government,” Oxfam said in the proposal.
Moderna’s board of directors urged shareholders to vote against the proposal. The board, 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 in vaccines.
Moderna is currently in a patent dispute with the National Institutes of Health, which helped develop the vaccine, over the technology behind the vaccines. The White House’s chief medical adviser, Dr. Anthony Fauci, told reporters last week that the NIH would license the technology worldwide if it won a dispute with Moderna.
Moderna’s board of directors said the company has agreed to supply 650 million doses of Covax, an international alliance that promotes improved access to Covid vaccinations 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 tentative agreement with Kenya to set up a vaccine manufacturing facility in the East African country to support immunization in Africa.