A booming market for weight loss medications, new vaccine launches and innovative ADC drug research were all winners for pharma companies in 2023. And with those wins, CEOs took home some big paychecks.
While not all pharma companies have released their total compensation tables for executives from 2023, available data shows that CEOs are reaping the rewards of the industry’s gains. CEO pay came under fire last year as inflation and higher interest rates ate away at wages across industries, and income inequality between workers and CEOs became the ire of unions.
To understand the ups and downs of a Big Pharma top dog, look no further than the face of pandemic darling Pfizer. CEO Albert Bourla saw one of the biggest pay bumps across pharma in 2022 when his compensation swelled to $33 million for the year — up from about $24 million in 2021. His compensation that year even earned him a ranking among the highest paid CEOs in the S&P 500. At the time, Bourla’s take-home pay widened the gap of the company’s CEO pay ratio to 437 times the annual total compensation of the median-paid employee. Bourla led the company through the COVID-19 pandemic and helped grow Pfizer’s vaccines business by 50% within four years thanks to its COVID-19 shot, and the company reported all-time high revenues of $100.3 billion in 2022, which contributed to Bourla’s huge compensation increase. However, as 2023 COVID vaccine sales dwindled, Bourla’s compensation fell to $21.6 million for the year, leaving him off the list of pay bumps this time around.
Bourla’s up-and-down pay reflects the high reward compensation scale for most big pharma CEOs, with company performance playing an important role. Here are five notable CEO pay bumps in 2023, according to the latest available SEC filings among the largest pharma companies by market cap.
Joaquin Duato, CEO and chairman, Johnson & Johnson
Total 2023 compensation: $28.4 million
Pay bump from 2022: 117%
The backstory: Joaquin Duato took over the coveted CEO and chairman roles of J&J in early 2022 following the departure of Alex Gorsky. In his first year at the helm, Duato, who had a long tenure with J&J prior to taking the top job, earned $13.1 million. In 2023, he received a substantial pay bump of 117%, according to recent SEC filings, a compensation jump largely the result of $16.4 million in long-term incentive benefits. Duato’s actual salary was $1.6 million, which will remain unchanged in 2024.
Duato oversaw J&J’s rebrand after it spun off its consumer health business into the standalone company Kenvue. J&J saw a sales jump in 2023 from the prior year, reaching more than $85 billion, up from just under $80 billion in 2022, according to its end-of-year earnings report.
With the latest reported pay bump, J&J’s CEO-to-employee pay ratio was 338 to 1, according to the filing.
Emma Walmsley, CEO, GSK
Total 2023 compensation: 12.7 million pounds (more than $16.2 million)
Pay bump from 2022: 51%
The backstory: GSK CEO Emma Walmsley took home more than $16.2 million in total compensation in 2023, far above her 2022 compensation of 8.46 million pounds, or nearly $10.8 million, in 2022. Her salary jump came from an increase in long-term incentives, which accounted for 7.3 million pounds ($9.3 million) of her total compensation, plus 3.78 million pounds in bonuses, or about $4.8 million. The company reported total sales growth of 5% in 2023.
The success comes after GSK spun off its consumer healthcare business Haleon in 2022 and focused on becoming a major player in infectious disease. The company has continued to sell off Haleon shares for billions of dollars since.
Among its hits in 2023, the company’s RSV vaccine, Arexvy, became a blockbuster just four months after its debut, raking in $1.5 billion for the year in sales. The vaccine is expected to be approved for 50- to 59-year-olds in 2024, and GSK is preparing for at least 12 major launches in the coming years, including new vaccines and specialty medicines for infectious diseases, HIV, respiratory and oncology. 2023 could be called a rebound for Walmsley, who faced scrutiny from activist shareholders in 2021, and has been CEO of GSK since 2017.
David Ricks, CEO, chair and president, Eli Lilly
Total 2023 compensation: $26.6 million
Pay bump from 2022: 24%
The backstory: Eli Lilly was a winning stock in 2023 after its value jumped 59% — its second-biggest stock performance of the last quarter century. As a result, Lilly became the most valuable pharma company in the world, overtaking J&J with a performance that was lucrative for CEO David Ricks, who took home $18.8 million in stock awards in 2023, according to the most recent SEC filing. His salary made up just $1.6 million of his total compensation for the year.
Lilly was among first drug companies to face price cuts head on, announcing in early 2023 it would cap out-of-pocket costs at $35 a month — a 70% price cut for the company — for its insulin product, Humalog. The announcement preceded government mandates to cap insulin at the same rate for seniors, and may have been a reputational move for the pharma giant after year-over-year insulin price increases caught the attention of lawmakers and media.
However, the big story for the company’s success was its tirzepatide product, Mounjaro, which was approved for patients with Type 2 diabetes. The blockbuster is among an emerging class of weight loss medications that could grow to a $100 billion or even $200 billion market by 2030, according to some estimates. Lilly reported more than $5 billion in Mounjaro sales in 2023. The company’s second tirzepatide product, Zepbound, was approved for chronic weight management by the FDA in November.
Dr. Vasant Narasimhan, CEO, Novartis
Total 2023 compensation: 13.3 million Swiss franc (more than $15 million)
Pay bump from 2022: 21%
The backstory: Novartis delivered strong growth in 2023, reporting increases of 10% net sales and 18% core operating income growth compared to 2022. On top of that, its net income rose 62% for the year to $8.6 billion.
Narasimhan, who has been CEO since 2018, has led the company to become a “pure-play innovative medicines company,” and his pay largely increased year over year thanks to higher annual incentives based on the company’s performance.
Pascal Soriot, CEO and executive director, AstraZeneca
Total 2023 compensation: 16.9 million pounds (about $21.5 million)
Pay bump from 2022: 10%
The backstory: As much as 91% of AstraZeneca CEO Pascal Soroit’s 2023 compensation came from performance-linked incentives, according to the company’s latest report. The company reported 6% growth in revenue for 2023, reaching $45.8 billion for the year, but Soriot’s pay was enough to cause a bit of a stir among some media outlets.
Some of the year’s successes included U.S. approvals for its breast cancer treatment Truqap used in combination withFaslodex and its nerve disease drug Wainua, while its ADC candidate Enhertu with partner Daiichi Sankyo is being reviewed by the FDA for adults with unresectable or metastatic tumors that express the protein HER2. Enhertu could potentially be the first ADC to receive a tumor-agnostic indication, the company said earlier this year.
While the company is making moves in ADCs, AstraZeneca is also eager to get into the burgeoning weight loss drug market, licensing an experimental obesity and Type 2 diabetes drug from Eccogene in China for $2 billion at the end of last year.
