If you are under tremendous pressure to succeed, you might as well also receive tremendous compensation. CEOs at publicly held biotech companies get their share of both, and these leaders' salaries are on the rise. But there are some wrinkles: Overall compensation is being restructured as boards of directors, feeling the heat from big investors such as mutual funds and shareholder groups, struggle to rein in long-term compensation such as stock options in order to reduce stock dilution. The pressure is further exacerbated by recent accounting rule changes on expensing stock options, along with stronger financial reporting requirements under the Sarbanes-Oxley Act.
Average cash compensation (both annual salary and bonus) paid to biotech CEOs rose nearly 5% to $596,000 in 2004, from $567,000 in the previous year, according to BioWorld magazine's 2006 Executive Compensation Report. (see CEO Pay for Performance chart).
The largest and most successful biotech companies paid their ...
