Schering-Plough’s Chief Scientist Gets A Raise
10 CommentsBy Ed Silverman // September 20th, 2008 // 10:38 am
Just a few days before eliminating more than 1,000 sales reps as part of a massive cost-cutting campaign designed to save $1.5 billion in expenses by 2012, the drugmaker awarded its chief scientist a basket of goodies - a 5 percent pay hike, an increase in his annual bonus and new stock awards.
The Schering-Plough board’s compensation committee gave Tom Koestler, formally an exec vp who heads the Schering-Plough Research Institute, a salary of $864,000, up from $823,000; an increase in his annual incentive to 80 percent of base salary from 70 percent; and a service and performance-based stock award of 250,000 common shares, assuming he stays until October 1, 2012.
The reasoning? The actions were taken “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,” according to a filing with the Securities and Exchange Commission.
It’s certainly true that leadership, particularly in the lab, is crucial right now for Schering-Plough, which has suffered a huge drop this year in Vytorin and Zetia scrips, and the FDA rejection of the sugammadex anesthesia drug. These were the meds that were to see the drugmaker, which unlike its rivals, doesn’t face patent expirations on huge-selling drugs, through the next few years. But why give him this deal now? Perhaps he had a job offer. Nonetheless, the timing is unfortunate.
Condor
Actually it was 16 percent increase — over his 2007 base salary — as disclosed in the proxy.
Take a look on my site for the detailed analysis.
Good stuff, Ed!
Insider
He’s gonna earn it……..
LILLI
He must connections.
LILLI
He must have connections
Dan A.
he’s paid for his silence
SP 2
Absolutely! The big cheese at Schering-Plough simply cannot risk that he would be outside the company with all that he knows. This is particularly true after the ENHANCE and SEAS disasters involving Zetia and Vytorin.
However, if there is any justice in America, he and the rest of the top crew at Schering-Plough will be called to testify before Congress as well as other governemnt agencies.
CVRR
Are you kidding me? Most of Vytorin and Zetia’s woes are related to horrible scientific trial management. Overdue outcomes studies and poorly designed esoteric clinical trials of little value to the general population.
Forget about what he may know, he must have pictures too.
SP 1
Beg to differ, but the top management team made the biggest mistakes when they apparently drug their feet with the release of the results. Bad news, bad decisions and a bad result. As for the head of research, shouldn’t he bear some responsibility for all of the failures of SPRI in the recent past. They haven’t gotten one good thing done in the past couple of years since he took the reins. So much for being held accountable! fail, then get a huge raise and a bundle more money. What’s wrong with this picture? Schering-plough!!
Casual Observer
The injustice of it all! Schering-Plough cuts 1000 jobs and the man running what appears to be a failing development operation gets a huge raise, a lot more money and major perks.
Shocked
Scxhering-Plough does it again - rewarding those that haven’t seemed to contribute much. Isn’t this the guy who has been in charge of the SPRI during the complete fiasco of ENHANCE, SEAS, Vytorin and Zetia? I think so!!