Healthcare CEOs are not ‘bleeding money’

May 4, 2018

The Axios new site revealed the annual compensation of five chief executives in the healthcare industry on May 3—and their bank accounts are extremely robust.

In fact, Axios reports, some of these pay packages for pharmaceutical leaders represent “hundreds of times more than the median employee at their companies” is making.

The CEO numbers are calculated using actual realized stock gains, instead of the estimates that are displayed in company filings. (Employee figures are the only numbers listed in filings and may only include estimated stock.)

Biogen (Therapies for neurological and neurodegenerative diseases)

  • CEO Michel Vounatsos: $4.9 million
  • Pay ratio: 33:1 (median employee made $148,904)

Celgene (Medicines for inflammatory disorders and cancers)

  • CEO Mark Alles: $4.5 million
  • Pay ratio: 21:1 (median employee made $213,089)
  • Retired CEO Bob Hugin, who is running for U.S. Senate (R-New Jersey), made $40.5 million.

DaVita (Dialysis treatments)

  • CEO Kent Thiry: $15.6 million
  • Pay ratio: 258:1 (median employee made $60,332)

Exact Sciences (Early detection of colorectal cancer)

  • CEO Kevin Conroy: $32.3 million
  • Pay ratio: 328:1 (median employee made $98,724)

Sage Therapeutics (Medicines for central nervous system disorders)

  • CEO Jeff Jonas: $28.2 million
  • Pay ratio: 73:1 (median employee made $383,682)

These compensation packages have drawn attention from the American public and legislators. At a press conference in January 2017, U.S. President Donald Trump accused the pharmaceutical industry of “getting away with murder” and said that he would change the way the country bids on drugs to bring prices and spending down, according to a report by The Washington Post.

“Pharma has a lot of lobbies, a lot of lobbyists and a lot of power. And there’s very little bidding on drugs,” Trump said during the event at Trump Tower in New York. “We’re the largest buyer of drugs in the world, and yet we don’t bid properly.”

To date, the federal government has not been allowed to negotiate with drug companies to bring down the price of medicines for seniors using Medicare.

Even if legislation were passed to enable such deals, these high pay packages likely would make the process more difficult.

Research contact:

Leave a Reply

Your email address will not be published. Required fields are marked *