Biotech Executive Paychecks Get A Little Fatter | Study of life sciences firms shows salaries on the rise
A recent survey has found that execs in the life sciences industry are still bringing home handsome paychecks despite the troubling economic times.
The survey — conducted by Compstudy — was of 1,000 executives at 189 U.S. companies, including 39 companies in New England. This is the sixth year of the survey.
Creeping Up
Overall, execs in the biotech and medical device arena got raises this year, with base salaries rising 5.2 percent from 2007 to 2008.
While the survey is only a snapshot at a given time, it’s an interesting one that shows that, at least for now, CEOs and other executives at life sciences companies, are doing pretty well.
Of course this time next year it will be very interesting to compare this year’s and next year’s data, and see if conditions have continued in this vein.
Interestingly enough, the number of executives that became eligible for bonuses jumped from 59 percent to 82 percent in 2008.
And target bonuses are an increasing percentage of the base salaries of certain executives, most notably for those that head up sales and CEOs. Target bonuses for 2008 sales heads are 33 percent of their base salaries, while it’s 31 percent for CEOs. CTOs’ target bonuses aren’t so bad either at 27 percent of their base pay.
Overall bonus targets, as a percentage of base salary, did not change a lot from 2007 to 2008, with the average rising from 22 to 24 percent of executive pay year over year.
Now we get to the all-important equity, or stocks that executives get as part of their hiring packages. About 18.6 percent of 13 top executive positions have stock as part of their packages, which is up only slightly from last year’s 18.1 percent. Both years saw an increase over the 2006 data, which showed 16.2 percent of the executives had stock.
Just as they are lured to companies based on a specific salary and stock packages, many executives are provided for on their way out.
Seventy-two percent of the non-founding CEOs have severance packages, which average at least six months in duration.
Interestingly, when it comes to salary, non-founding CEOs prevail, with an average salary of $297,000 versus $258,000 for CEOs who are also founders. That amounts to a a 15 percent premium.
Data about the companies themselves was pretty interesting as well. Of the 189 companies, 48, or about 25 percent were on their second round of financing. About 15 percent of the companies, 29 to be exact, were on their fifth round or more of financing.
WBJ Web Partners
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