All of these will vest when the Merck transaction closes -- and so long as the price is then above $22.91, this is simply a GIFT to Hassan, for no additional performance -- from Hans Becherer. Disgusting. Remember he is already getting at least $78.6 million, and about ANOTHER $7 million, for every dollar the stock rises, over $22.91. More soon. From the SEC Form 4, just filed, then:
. . . .868,300 shares at $22.91. . . .
In fact, all of the EMT got these options on May 1, 2009. What "performance" does this secure? I don't even understand the theory here.
This is a simple gift of money to all of the EMT -- for no additional performance, assuming Schering-Plough common stock is trading above $22.91, on the NYSE (seems likely, as the announced value was above $26 per share, on March 9, 2009), on the day CEO Hassan closes this reverse merger, when the all these options vest due to a change of control event.
So, if the deal closes at $26, CEO Hassan personally will receive his $78.6 million, PLUS about another $21 million ($3 per share, times about 7 million shares or share-equivalents, then held) -- or, $99.6 million before tax gross-up payments -- even more, after the gross up.
Does anyone believe any of the EMT members would leave the other 90 percent of their respective golden parachutes, and walk away, if this last bit was NOT paid? What is the theory?
Fill out your executive compensation survey. Do it now.
7 comments:
Tomorrow is the PDUFA due date for the re-review of Iloperidone an antipsychotic that's been turned down twice before and was dropped by Novartis after the phase III trials.
Maybe they think this is a bellweather for what will happen with asenapine.
As for that it ain't over till it's over.
Salmon
Wild!
Thanks, as ever, Salmon -- and prodigious timing, again, to boot!
Namaste
Iloperidone was approved 30 minutes ago.
Maybe someone at FDA tipped off Fred and Hans in the last week or two.
Salmon
PS Last year the medical reviewer who turned down iloperidone was forced out of the Psych group a few weeks later.
And SGP traded up, yesterday -- on the news (increasing the value of Fred's in the money options -- and share equivalents -- granted to him by Hans) -- he's got a paper gain of $3.5 million on Thursday's NYSE trading.
OTOH, SGP is off, on the NYSE, this morning (he has "lost" about $1.5 million of the "paper" $3.5 million he "made" yesterday).
Great stuff, though, Salmon!
Thanks!
Forbes has an article on what the iloperidone approval may mean for asenapine and bifeprunox a Solvay/Wyeth antipsychotic turned down in summer of 2007.
http://www.forbes.com/2009/05/07/fda-vanda-trials-business-health-care-antipsychotics.html
(Bifeprunox turndown announced Friday Aug 10th 6% drop in Solvay stock on Aug 9th. That's right, the price dropped before the information came out that it wasn't approved.)
Plus there's an anonymous comment on the blog Furious Seasons that the medical reviewer for iloperidone was forced out of the psych group a few weeks after it was turned down.
http://www.furiousseasons.com/movabletype/mt-comments.cgi?entry_id=2253
Note also that Forbes mentions that only a reanalysis of the iloperidone was needed. Kind of like what seems to be the case with asenapine.
Appears to be a pattern here.
Salmon
Ironic that the EMT was given more options but directors still don't know how many options or grants they received with this year's AIP bonus.
Here's a follow up post, on this last anonymous comment.
Thanks -- one and all!
Namaste
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