Children’s Health Defense
May 12 2021
… CEOs Get Ultra Rich Off Massive Pay Packages, Questionable Stock Sales
As pharmaceutical companies make billions from COVID vaccines and reassure investors that plans are underway for boosters and annual shots, CEOs of Pfizer, Moderna, AstraZeneca and Johnson and Johnson (J&J) are pocketing millions with massive compensation packages and questionable stock sales.
In his weekly notes to investors last month, Bernstein analyst Ronny Gal offered shocking revenue estimates for Pfizer and Moderna’s mRNA vaccines — $24 billion in revenue for Pfizer compared with $14 billion for Moderna.
By the fourth quarter, Gal and his team project industrywide COVID vaccine revenues reaching more than $18 billion per quarter. The Pfizer-BioNTech and Moderna shots will account for roughly $11 billion of that amount with the remaining revenue split equally between J&J, AstraZeneca and Novavax, Fierce Pharma reported.
Pfizer’s first quarter revenue report released May 4 showed $3.5 billion in revenue generated during the first three months of this year by the company’s COVID vaccine — making it the biggest source of Pfizer’s revenue. The company now anticipates revenue of $26 billion for its COVID vaccine, up from its previous estimate of $15 billion.
According to a February report by Accountable.US — a nonprofit non-partisan public advocate and watchdog organization that monitors public corruption — executives at five drug companies, including Moderna, Pfizer, J&J, Emergent Biosolutions (contracted to manufacture J&J’s vaccine) and Novavax made $250 million dumping company stocks during the first six months of “Operation Warp Speed.”
According to U.S. Securities and Exchange Commission (SEC) filings, from the beginning of September through November 15, 2020, executives and directors at Pfizer, Moderna, Novavax and Emergent, who received government COVID vaccine funding, made stock transactions valued at a net profit of more than $105 million.
In February, Accountable.US sent letters to Pfizer, Emergent and Moderna calling for the release of the 10b5 automatic trading plans used by top executives who made millions of dollars dumping company stock and requested CEOs freeze sales until the SEC could investigate and release updated guidance regarding automatic trading plans for companies receiving taxpayer funding and advance purchase guarantees.
Moderna CEO becomes a billionaire, top executives sold stock before key announcements
Moderna entered 2020 as a clinical-stage biotech company with a focus on messenger RNA technology. Now the company is one of three with an authorized COVID vaccine that could land them among the top vaccine players by revenue this year, CEO Stéphane Bancel said in January.
Bancel is 665 on Forbes’ annual list of the world’s richest people in 2021 and ninth on Becker’s Hospital Review of 35 billionaires in U.S. healthcare. Bancel’s net worth is $5.5 billion.
According to Fierce Pharma, Bancel received a pay package worth $12.85 million in 2020, up from $8.9 million in 2019, according to a proxy filing in March. The chief executive collected a salary of $950,000, a $1.9 million bonus and stock options worth $9 million.
The total is far below what Bancel reported for 2018, after the company’s $604 million public offering. That year, the CEO’s pay package amounted to $58.6 million, making him one of highest-paid biopharma CEOs that year.
As Moderna continues to negotiate deals for its shot, it’s “not impossible” that the company’s 2021 sales could eclipse “the entire revenue of one of the four big vaccine companies,” Bancel said. The company “might be one of the top four, top three,” vaccine companies this year, he added.
In 2020, Bancel came under fire when he tripled the number of company shares to be sold through an executive stock plan that was changed just days after the company announced positive early results for its COVID vaccine.
The Moderna CEO sold more than 72,000 Moderna shares in July 2020, generating nearly $4.8 million. That was more than triple the 22,000 shares he had previously scheduled to sell during the same period through the company’s executive trading plan.
In the past month alone, Bancel has sold more than 79,000 shares of Moderna stock, with his most recent sale generating $2.5 million.
Moderna co-founder and chairman Noubar Afeyan has also cashed in on Moderna’s soaring stock price, selling more than $1.5 billion in shares since the World Health Organization declared a pandemic on March 11, 2020.
According to news sources, multiple top executives at Moderna adopted or modified their stock-trading plans just before key announcements about the company’s vaccine selling tens of millions of dollars in Moderna stock — even before the company had completed its vaccine trials.
“Once again, drug company executives have been caught playing games with their stock options,” Kyle Herrig, who heads the government watchdog group Accountable.US, said in an email to CBS MoneyWatch.
Although no insider trading was alleged, the fact that the plans were changed during the pandemic as news was emerging about the company’s closely watched vaccine raised questions about how Moderna executives pocketed millions of dollars in early months of the pandemic.
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