David Brennan: AstraZeneca's $65 Million Man?

Now, that he is retiring after a spell of disappointments on the job, David Brennan may yet have reason to feel cheery. An unconfirmed report in The Sunday Times over the weekend suggests the outgoing ceo - who officially leaves on June 1 - will receive a $65 million exit package that includes an annual pension of approximately $1 million a year (

back story).

One could argue this is overly generous, given the setbacks that occurred on his watch. These include continual struggles to replenish the product pipeline and the failure of the $15 billion acquisition of MedImmune five years ago to yield any substantive results. Nonetheless, Brennan saw his 2011 compensation rise 11 percent (see this).

However, an AstraZeneca spokesman notes that final details have not been determined and the package will reflect a long tenure that began decades ago in sales. "The exact terms of David Brennan's package on retirement have yet to be agreed by the board, which we'll disclose in due course. The figures used in media reports are entirely speculative at this stage,” he writes us. "The pension fund David has built up reflects a 36-year career with the company at increasingly senior positions.”

Whatever the final numbers, the package may become the subject of debate, if only because ceo compensation is such a hot-button issue these days, especially when companies have generated disappointments. Another example has been Bill Weldon, who is about to step down as ceo at Johnson & Johnson, but will remain chairman for an unspecified period of time.

The embattled Weldon will receive $143.5 million in retirement (read here), although his tenure has been pockmarked by repeated quality control lapses that led to embarrassing manufacturing gaffes, product recalls and a consent decree, which contributed to declining sales and a loss of standing among consumers.

12 Comments

Apr 30, 2012 - 9:27am
what's this? $65 million plus $1 mil/year retirement? And AZ just tried (and thus far failed) to drop $650 million on an ill-conceived study in 'psychosis prevention' in the land down under.

Such profligate, greed driven decisions - juxtaposed with recent cuts in R&D - are misguided in the extreme. What a joke AZ has become.

May 1, 2012 - 11:30am
I know of no other job, except maybe the Weatherman, that you could do a job with poor outcomes and still be paid a lot of money. Corporate CEOs make money when they do a bad job and make MORE money when they do a good job. When they make poor decisions, their employees suffer but they make money. When they make a good decision...their employees make the same money and they make more money!!! What is wrong with this picture?
May 1, 2012 - 12:39pm
Db will have the last laugh. Since he is American they will have to pay him in u.s Dollars,which are doing quite nicely vs the British pound.
May 1, 2012 - 2:08pm
Brennan would have been better off as a weatherman. That way he might have known which way the wind was blowing .
May 1, 2012 - 4:35pm
As I quote from the movie, "The Producers", when Xero Mostel looks out his office window and sees a brand new Rolls Royce parked below, he says, "If you got it flaunt it". Brennan is flaunting his wealth without Producing. The numbers are the flaunting. Reminds me of Mr. Sharer (Amgen).
May 1, 2012 - 5:40pm
Enroning the pharma industry...? Ridiculous salaries considering that their SCIENTIFIC contribution to medical discoveries is not 475 times more valuable than the bench chemist doing basic research...and they're marching on the streets in Jakarta on May Day to protest the outsourcing of jobs from Indonesia to where?!- looks like that schtick is in the last phase....

Country - Ratio of Pay CEO : Average worker Japan - 11:1 Germany - 12:1 France - 15:1 Italy - 20:1 Canada - 20:1 South Africa - 21:1 Britain - 22:1 Mexico - 47:1 Venezuela - 50:1

and now... (drum roll please)

UNITED STATES - 475:1…

In 1980 USA execs made less than 30 times. A 15 fold plus increase.

May 1, 2012 - 7:57pm
In 2008 ExxonMobil's revenues were more than 10 times what they were in 1980. Why shouldn't CEO'S share in that success?
May 1, 2012 - 8:09pm
I don't see any bench chemists in this image.

http://www.flickr.com/photos/swanksalot/7132972425/

May 2, 2012 - 1:31pm
@oii - why were the revenues 10 times more than what they were in 1980? Complex story, eh?

Agree, both the workers and the CEOs should divide up the spoils...

Jun 27, 2012 - 9:07am
As an AstraZeneca stockholder, I'm outraged. This guy has done absolutely NOTHING, oh, well except dig a hole so big that AstraZeneca will NEVER crawl out of it.

Lots of good people have lost their jobs. Anybody I speak with that's still there, hates it.

All sorts of short gain nonsense. Outsource this, outsource that. Who cares about the lack of quality. Vastly reduced research. How many compounds in various stages of development did this guy just put the breaks on?

But hey, amidst all that, amidst all the layoffs, let's give him $64m for making a AstraZeneca a place with nothing in the pipeline that nobody enjoys working at anymore. Great job, David. And here I thought boards of European based companies were smarter. Looks like they've fallen victim to the same greedy trash we do over here in the United States...

Jun 27, 2012 - 9:12am
Original Industry Insider?

----- In 2008 ExxonMobil’s revenues were more than 10 times what they were in 1980. Why shouldn’t CEO’S share in that success? -----

You're kidding, right? This was a function of Wall Street greed, which in turn, puts the screws to everybody, everywhere. The CEO had absolutely NOTHING to do with it.

CEOs work for the shareholders. Boards select them and boards are supposed to be looking out for the best interests of the shareholders.

You honestly believe that throwing hundreds of millions at these guys for doing their jobs, including LOUSY jobs, is in the best interest of the shareholders?

You believe it's the RIGHT thing to do while they layoff thousands of rank and file workers for short term gains?

I feel it shows a complete and total lack of ethics.

Jun 27, 2012 - 3:52pm
Bob, have you ever seen a pharma CEO compensation package? I have. They are structured in such a way as to largely immunize the executive's compensation from the day-to-day performance of the company. They are NOT at will employees. They all operate off of contracts ranging from 3-5 years, and have job security for that period unless there is some type of M&A.

You and I get paid on the basis of pay for performance, and we can be fired at any time. Brennan et all work under a different compensation structure altogether. Their pay is also tied to others in their position. Thus when an Ian Read or another pharma CEO gets a raise the other boards follow in lockstep. It has nothing to do with company perfomance.

As Bruce Hornsby said, that's the way it is.