Novavax executives' pay comes back down to Earth after 8-figure package in 2020

2020 was a pretty good year for Novavax’s executives, who were showered with eight-figure pay packages thanks to option awards that came through. But for 2021, the cash has dropped down to a range more in line with the C-suite leaders’ previous years.

Thanks to some accounting changes, it sounds like 2022 might see another big payday for the vaccine maker's top brass. Read on, if accounting and proxy statements are your jam.  

In a statement to Fierce Biotech, Novavax stressed there was no reduction in pay. That is indeed true—in a sense. Both CEO Stanley Erck and R&D President Gregory Glenn got bumps in their base salary for 2021. But 2020 was simply an unusually big year for option awards. This portion of the executive's compensation is paid out based on time-vested stock options and stock appreciation rights each person received in 2019 or 2020. 

Stanley Erck, Novavax
Novavax CEO Stanley Erck (Novavax)

Let's start with Erck. He pulled in a cool $48 million in 2020, thanks to a $44.1 million option and other awards layered on top of his $657,000 base salary. For 2021, the total figure has dropped to $1.1 million, but it includes a 9.5% bump to his base salary, which now sits at $725,000. He received a total of $2.4 million in 2019.

Glenn catapulted into Fierce Biotech’s top paid R&D chief rankings last year with his whopping $24.9 million paycheck—a 1,229% increase over the prior year including $22.8 million in options plus other awards. But for 2021, things have gone down significantly to $813,000. That includes a $553,000 base salary, which is up 18% year over year. For 2019, Glenn was paid $1.9 million total.

The 2021 figures were revealed in Novavax's preliminary proxy statement released April 20. 

But here's where the accounting changes come in. A spokesperson for the company told Fierce Biotech that the option payouts have been moved from the fourth quarter to the first quarter. So the latest proxy does not include these awards. Erck, Glenn and team received those rewards reflecting 2021 performance in the first quarter of this year, according to the spokesperson. 

It's unclear whether those numbers will be revealed when the company reports first-quarter earnings, which have yet to be announced.

The eye-popping amount for 2020 landed as Novavax was in contention for the race to bring a COVID-19 vaccine to market. But through 2021, that dream faded, as the company missed deadline after deadline. An application for emergency use authorization was finally delivered to the FDA this January.

Just this week, the company, while briefing reporters on some new data for a flu-COVID vaccine, said the FDA had indicated plans to convene a panel of outside advisers to consider the shot. No date has been set for that meeting. The FDA, however, at the same time seemed to indicate officials were still awaiting data from the company.

So far, Novavax’s COVID shot has been approved in Japan and authorized in the EU, the U.K., Australia and South Korea, where it is known as Nuvaxovid.

Even though Novavax is late to the market—behind Pfizer-BioNTech, Moderna and others—analysts from Jefferies believe the protein-based vaccine could still bring in $4 billion to $5 billion in global sales this year.