Recall that -- during the pendency of the negotiations surrounding the Sch-MERCK transaction -- CEO Fred Hassan, and his top officers, just received between $3.4 million and $1 million, each, in deferred stock units, on February 27, 2009. Recall also that CEO Hassan will receive an additional $60 to $72 million, if he keeps his word, and walks away, when the deal closes.
Gee -- I guess that "just isn't enough", according to Fred's peculiar sense of entitlement. Last night, he reported an ADDITIONAL $4.74 million in deferred stock units, granted April 1, 2009. So, by my lights, he now stands to get something north of $78 million -- at deal close. And at least $35 million of that will be cash (in part, by receiving $10.50, at close, for every share of Schering-Plough he controls -- all of which vest, on a "change of control") -- no questions asked. 
In the interest of complete reporting, I should note that last night, Messrs. Bertolini, Cheeley, Koehler, Koestler (who garnered a big bump of 250,000 shares, in October 2008!), Kohan, Saunders, Sabatino (who already received an unscheduled $500,000, in cash in December 2008 -- about four months ago!), and Ms. Cox each received between $1.6 million, and $0.6 million, in deferred stock units. All in, it's north of $10 million, in April alone.
[In passing, I'll note that each of Messrs. Bertolini, Cheeley, Kohan, Saunders, Sabatino, and Ms. Cox received between $1 million, and $1.2 million worth of similar phantom units, on February 27, 2009, as well. Those February 2009 grants were about $9 million, all in.]
This is simply appalling, given all the talk of belt-tightening (at both companies); and the closing of an Irish facility, and the layoff of 240 ordinary Irish Animal Health employees in County Wicklow, earlier this week:
. . . .Pharmaceutical company Schering-Plough has announced it plans to close its operation in Bray, County Wicklow, Ireland. . . . which employs 240 people in Bray. . . .
It surely does seem true, this morning, that "some pigs are. . . more equal."
Truly disgusting.
7 comments:
Who are the imbecils who keep approving giving these pigs more and more money?! WHat is the possible justification for this?!
Thanks for the comment -- let me offer some assistance, here:
Talk to Hans Becherer, the Chairman of the Schering-Plough Compensation Committee of the Board of Directors:
Hans Becherer
[Former Deere & Co. Chairman, and]
Chairman, Compensation Committee
of the Board of Directors of
Schering-Plough Corporation
2000 Galloping Hill Road
Kenilworth, NJ 07033
He has responsibility for executive compensation practices at Schering-Plough.
Do write him with your thoughts.
Namaste
They continue to lay off hard working employees who need their jobs to support their families, but Fred and his merry minions just continue to take more and more for themsleves. How much do they need? They should be ashamed; but I am sure they are not.
Sadly, I think you are right -- I think they think they are entitled to every $1 -- or $10 million -- they take out of the till.
Namaste
I guess we really know now...why they never gave out the survey for compensation.
I wonder how Frank over on the Yahoo board can justify this?
And how much money is Mr Hans Becherer getting out of this?
I'm guessing a lot.
Well maybe it's time I enlighten you.
As I've mentioned before based on the Monday post Thanksgiving 2007announcement that asenapine was filed and assuming that Organon/SP actually got the news prior to Thanksgiving and adding the 75 days between filing and when a letter is issued we can estimate the asenapine filing no later than Sept 6, 2007. Add 10 months for a PDUFA goal date gives you July 6th, 2008 which matches an estimate of early July 2008 that from the Motley Fool.
However this is an estimate for latest potential filing date. Typically companies try to either file or have an approval/approvable letter by the end of the financial quarter as this is typically figured into bonuses. So if we simply move up an estimate of the filing date by 1 week we get a PDUFA goal date of just before the end of 2Q2008 (end of June 08) and a likelihood of people at SP earning big bonuses.
Now remember Freddie had his meltdown on the front page of the WSJ on June 30th, complaining he doesn't know what it takes to get a drug past the FDA (curious timing). Plus we didn't hear anything at all about the asenapine review until Jan 2009. Yet on June 23, 2008 just before Freddie went on his rant the FDA issued a brand new Policy and Procedure whereby FDA can alter the timelines for a review. This MaPP is
6010.8 NDAs and BLAs: Communication to Applicants of Planned Review Timelines.
and can be found at
http://www.fda.gov/cder/mapp.htm
which is strange because before this these MaPPs were always not FOIable, what's also strange is if you go to the webpage this MaPP unlike all the others does not have the issue or posting date listed (except inside the pdf file). Then 2 weeks later FDA issues the complete response letter policy whereby there is no longer any approvable letters.
In addition on June 16, 2008 FDA issued a public statement on cardiac toxicities of atypical and classic antipsychotics claiming there was no difference in toxicity however they included several compounds that are really atypicals in the classsic antipsychotic list. Now FDA could have issued a correction but if you look at the MaPPs again you will find that the very next day (June 17th) FDA issued a new policy
4151.6 "Drug Safety Newsletter" (Issued 6/17/2008, Posted 6/19/2008) indicating it wouldn't be corrected until January 2009 at the earliest. Which happens to be coincident with the NEJM article (which the editorial points out does not cover long term toxicities) and with the approvable letter for asenapine.
So all of this indicates that the true PDUFA goal date for asenapine was between June 23rd and the 30th.
Now if you look at the FDA Amendments Act of 2007 it discusses Memos of Understanding with the Pharmaceutical Industry. Although not specified in the final version earlier versions of the bill indicate if the drug is to be approved or even approvable then labeling will be provided to the company and labeling negotiations will begin 60 days prior to the PDUFA goal date.
So with a PDUFA goal date of June 30th 60 days earlier would be May 1st. However reviews need to be completed before this and add a couple of weeks for review by the team leader, and a few more by the cross disciplinary team leader and you pretty much expect to have a good idea if there is to be a positive decision by end of March or early to mid-April even if things are running behind. So if there were documented communications someone might have some ideas.
Now remember back in Jan 2008 Fred also said he would buy $2 Million in stock in 2 months (took him a bit longer). Plus if you've been paying attention to the news Fred and other CEOs have been complaining about FDA predictability. This is an interesting topic since those Good Review Practices mentioned in the MaPPs and those MOUs discuss timelines for PDUFA reviews and letting sponsors know of problems early so they can start working on them.
Well if you take a 10 month PDUFA clock and have to give the sponsor labeling at month 8, plus you have to give the sponsor a decision on filing by month 2.5 the most obvious timepoint for giving a sponsor a heads up of a possible deficiency so they can submit info prior and have it reviewed prior to month 8 would be at month 5 or for asenapine Jan 30th, 2009. Now just imagine if someone should happen to question the review team 2 weeks earlier as to whether they had any issues and called Freddie so he could make his Jan announcement about stock purchases.
To Recap:
Jun 23 - 30 2008: Asenapine PDUFA Goal Date
April 24, 2008: Fred purchases $2 million in SP stock
April 23 - 30: Labeling Negotiations:
April 15 - 23: FDA version of labeling prepared for negotiations
Late March early April 2008: Reviews completed
Jan 23 - 30: Midcycle review status and communication to SP
Jan 18, 2008: Fred announces plans to purchase SP stock
Jan 15 - 17, 2008: questioning of review team
Now add in when Freddie and crew got their bonuses and assume a few phone calls from FDA in there a few days to a week before each of the expected communication dates and things begin to look a little suspicious.
Now just imagine if someone could document that those hypothetical phone calls actually occurred.
Plus assuming my timelines are correct and reviews were done and there were communications. Then that means that something happened to delay the decision and forced FDA to issue a new policy to communicate changes in PDUFA goal dates along with delaying the approvable letter until Jan and the complete response until Feb which would help with selling off SP to Merck and would also goose Freddie's personal comp for the deal.
Salmon
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