Alkermes execs hit in the pocketbook, filing shows
- Despite a 31% rise in sales in 2016, top executives at Irish-headquartered Alkermes have taken a cut in their pay packages, according to a report last week in the Irish Times.
- Richard Pops, chairman and CEO, saw his overall package drop to $9,647,420 from $12,407,489, a 22% fall, despite a 3.4% increase in his basic salary.
- Chief Financial Officer James Frates, President Shane Cooke, EVP of R&D and Chief Medical Officer Elliot Ehrich, and Chief Compliance Officer and Chief Administrative Officer Kathryn Biberstein also all saw a decline in compensation, driven by a fall in stock value.
The total compensation for five key executives at Alkermes, based in Ireland since 2011 after its merger with Elan Drug Technologies, dropped by an average of 20% between 2015 and 2016, with CEO Richard Pops taking the biggest cut, according to an SEC filing made earlier this month. The loss is, at least in part, driven by a near halving of the stock value following the failure of a pivotal trial of its antidepressant at the beginning of 2016, and its lower trading throughout the rest of the year compared with 2015.
At the beginning of 2016, results from Alkermes' Phase 3 FORWARD-4 studies for depression drug ALKS-5461 showed that it hadn't reached its primary endpoint, though FORWARD-4 had trends towards efficacy. The company reworked the trial design for a new late-stage study dubbed FORWARD-5, and the drug met its primary endpoint.
Plans are going ahead for a new drug application in the adjunctive treatment of major depressive disorder in patients with an inadequate response to standard antidepressant therapies. However, this is a much smaller market than the company would have hoped for, and the earlier trial failures of FORWARD-3 and FORWARD-4 may count against it in the approval process.
Alkermes' income in the fourth quarter 2016 grew 31% over the same period in 2015, and grew 19% in 2016 overall compared with 2015. The company predicts a 17-23% growth for 2017. This is offset against a total debt of $283.7 million, narrowing from $349.9 million at the end of 2015, and a GAAP net loss of $208.4 million, compared with a GAAP net loss of $227.2 million for 2015.
- Securities and Exchange Commission Filing
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