. . .And, wouldn't it be perfect form, for the Kenilworth crowd, to bury them in the avalanche of uncertain financial news on Wall Street, today? Look for them after markets close, right here.
Just my (experience-based) hunch.
Check the comments to this post -- a thoughtful poster points out that Schering actually dumped a deceptively-huge raise for Dr. Koestler (head science guy) into a Friday night Form 8-K.
My reaction? -- we'll see the August IMS Vytorin/Zetia data Form 8-K on Monday or Tuesday, then -- but consider the other cha-cha underway, here:
What strikes me about this Friday night Form 8-K is not just that the board is paying Dr. Koestler more, but how the board chose to disclose (or partially-disclose) it:
The Form 8-K recites that Koestler "only" recieved a 5 percent base salary "bump". That may be (facially) factually accurate, but then it means he received an undisclosed earlier raise.
How so?
Well, the most recent Schering proxy (at page 34) indicates that his base -- for all of 2007 -- was $726,250 (before bonus, stock awards, SARs, options and long-term payouts) -- NOT the $823,000 recited in the Form 8-K.
The 8-K pegs his new base salary at $864,000 -- thus, actually, he garnered an increase of exactly 16 percent -- over his 2007 base salary.
So, for me, it is not just that the Chairman of the Compensation Committee of the Board (Hans Becherer -- pictured at right) dumped it into a Friday night disclosure (on Schering "layoff press release day", no less!), it is also that Schering's board, via Hans Becherer -- a named defendant in Cain v. Hassan (which alleges he breached his fiduciary duties in approving excessive compensation for Mr. Hassan in May of 2008, and others, among many other matters) -- apparently played "hide and seek" with where the 2008 currency converter pegs "30 pieces of silver", these days.When at least 1,000 salespeople lose their jobs, and the rest are lucky ot be able to stay -- with no increase, mind you -- Koestler walks off with nearly a million a year -- up one-sixth from last year -- and that is BEFORE stock, and options and bonus.
Sheesh.
5 comments:
In science you form a hypothesis based on prior observations and use that to predict future events.
Salmon
And last time (July 2008 data), it was dumped after 7 pm EDT, on a Friday, long after all the lower Wall & Broad analysts had left for the bars. . . . This time, Schering employyes are still reeling from yesterday's sales-force cuts -- and this bearish IMS data will suggest that the puzzle-palace dwellers in Kenilworth "had no choice" but to cut heads.
Consider it "buried" -- again.
Thanks, as ever, here Salmon!
Form 8-K for SCHERING PLOUGH CORP
--------------------------------------------------------------------------------
19-Sep-2008
Change in Directors or Principal Officers
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. On September 15, 2008, the Compensation Committee of the Board of Directors of Schering-Plough took the following actions with respect to the compensation of Thomas P. Koestler, Ph.D., Executive Vice President & President, Schering-Plough Research Institute:
� Effective October 1, 2008, Dr. Koestler's base salary will be increased by 5%, from $823,000 to $864,000;
� Effective January 1, 2009, Dr. Koestler's target annual incentive will be increased from 70% of base salary to 80% of base salary; and
� On October 1, 2008, Dr. Koestler will be granted a special service- and performance-based stock award with respect to 250,000 Schering-Plough common shares pursuant to the Schering-Plough Corporation 2006 Stock Incentive Plan. The shares subject to the award are to be earned by Dr. Koestler, if at all, based on certain research and development initiatives during the period of October 1, 2008 through September 30, 2012. In addition, for retention purposes, Dr. Koestler must remain employed by Schering-Plough through October 1, 2012 in order to receive the shares.
The above actions were taken by the Compensation Committee in recognition of Dr. Koestler's strong performance in a key role that is critical to Schering-Plough's future success, and in light of the strong competition for executives with his expertise and stature.
All other terms of Dr. Koestler's employment agreement with Schering-Plough, dated December 19, 2006, remain in effect and are unchanged. This employment agreement was included as Exhibit 10(e)(v) to the 2006 10-K.
A couple of months ago FDA announced approval of the first pharmacogenomic tests for biomarkers for renal toxicity of drugs. The person heading this up was Felix Frueh. Schering Plough Research Institute was one of the groups involved in this via the FDA/Pharma predictive safety consortium where Pharma shares tests. When I did a search of Frueh and these renal tests not only did abstracts involving him and his associate director come up but there were abstracts from SPRI where the associate director was involved in developing these type of pharmacogenomic tests for renal toxicity at SPRI.
Kind of nice isn't it the same scientist at SPRI who develops tests goes to the FDA where he appears to be possibly involved in approving the tests. Not only that but this was touted as setting the bar for approval of pharmacogenomic tests in the future.
Everything could be on the up and up, but I sure would be interested in more details. Plus I wonder why the SPRI head is getting such a nice salary increase.
Scientist
I hear and agree with both of you -- and I'll edit the main post accordingly -- but what strikes me here is not just that the board is paying Dr. Koestler more, but how the board chose to disclose (or partially-disclose) it:
The Form 8-K recites that Koestler only recieved a 5 percent base salary "bump". That may be (facially) factually accurate, but then it means he received an undisclosed earlier raise.
How so?
Well, the most recent proxy indicates that his base -- for all of 2007 -- was $726,250 -- NOT the $823,000 recited in the Form 8-K.
The 8-K pegs his new base salary at $864,000 -- thus, actually, he garnered an increase of exactly 16 percent -- over his 2007 base salary.
So, for me, it is not just that they dumped it into a Friday night disclosure (on layoff press release day!), it is ALSO that Schering's board (Hans Becherer) apparently played "hide and seek" with what the 2008 currency converter pegs 30 pieces of silver at, these days.
When 1,000 salespeople lose their jobs, and the rest are lucky ot be able to stay -- with no increase -- Koestler walks off with nearly a million a year -- up one-sixth from last year -- and that is BEFORE stock, and options and bonus.
Sheesh.
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