March 24, 2015
By Alex Keown, BioSpace.com Breaking News Staff
INDIANAPOLIS – A big boost in pension valuations more than offsets a dip of 5 to 10 percent in compensation for Eli Lilly and Company ’s top five executives, the Indianapolis Star reported reported Tuesday.
With a change in the way the company accounts for its pension plans boosted the overall value of the executives’ compensation by about 30 percent. The company reported executive earnings in a proxy statement filed Monday with the U.S. Securities & Exchange Commission. The Indianapolis Business Journal reported reported the higher pension values reflected an extra year of service with the company, as well as a change in actuarial valuation. The actuaries are now assuming a longer lifespan for the company pensions, which means more years of pension benefits.
John Lechleiter, Eli Lilly’s president and chief executive officer, received total compensation of $14.48 million in 2014, a 29 percent jump over 2013. He received $10.1 million in cash, stock and perks last year, down 9.7 percent from 2013, the Indianapolis Business Journal reported. A fluctuation in overall compensation is nothing new for Lechleiter and other executives. In 2013 Lechleiter was paid $11.2 million in salary, bonus, stock and perks, a 10 percent increase over 2012. In 2010 Lechleiter took home $12.7 million in overall compensation, down more than 22 percent from compensation in 2009.
Chief Financial Officer Derica Rice saw a 9 percent dip in her annual earnings from 2013, with pay of $4.7 million in cash, stock and additional perks. However, his pension value rose more than $2 million.
Michael Harrington, Lilly’s general counsel, saw a 6.4 percent decline in pay from 2013. He took home $2.7 million in cash, stock and perks. His pension value rose about 28 percent though, raising his overall compensation for 2014 to $4.1 million.
Enrique Conterno, head of Eli Lilly’s diabetes division, took home total compensation of $3.9 million, including $2.7 million in cash, stocks and perks, as well as a boost in his pension.
Eli Lilly’s head of research and Development Jan Lundberg actually saw a 3.5 percent decrease in overall compensation, which was at $4.6 million, including $4.1 million in cash, stock and perks, down 10 percent from the previous year.
In 2014 Lechleiter said 2014 would be a financially challenging year costing the company billions of dollars due to the loss of Zyprexa’s patent in late 2011 as well as generic competition for its top-selling drug, Cymbalta.
Despite the loss of patent protection, the company’s stock has soared over the past few years, with a 79 percent growth from 2012 to 2014. Eli Lilly’s stock was trading up slightly this morning at $76.43.
BioSpace Temperature Poll
U.K.-based GlaxoSmithKline filed a WARN letter in late February with the state of Pennsylvania indicating another 150 people would be laid off in its commercial and research and development group near Philadelphia. BioSpace wants to know if you think Pharm Country will do what it takes to keep biotech jobs in the area?
