Mylan pay plan not supported
Proxy advisers urge shareholders to vote against firm’s directors
Two firms that advise institutional investors on proxy voting are urging Mylan shareholders to vote against the generic drugmaker’s pay practices at the company’s June 22 shareholder meeting in Amsterdam.
The proxy advisers also are recommending voting against some Mylan directors up for reelection at the meeting.
The advisers cited concerns about the $97.6 million that Chairman Robert Coury was paid in 2016 and the 29 percent drop in Mylan’s share price last year caused by outrage over price increases for Mylan’s EpiPen emergency allergy shot.
Rockville, Md.-based Institutional Shareholder Services said Mylan’s pay practices last year “included multiple egregious pay decisions and large payouts despite the harm to the company inflicted by the EpiPen controversies.”
Glass Lewis, which is based in San Francisco, said Mylan “has been deficient in linking executive pay to corporate performance.”
ISS and Glass Lewis also recommended voting against Mylan’s pay practices at the company’s 2016 shareholder meeting.
Federal regulations require companies to submit their executive compensation policies to shareholders periodically for a nonbinding vote. Companies are not required to do anything based on the outcome of the
vote, but many that receive poor support end up addressing some of the concerns proxy advisers express.
Fewer than 1 percent of pay plans have been voted down so far this year, according to compensation consultant Semler Brossy.
ISS is recommending that Mylan shareholders vote against 10 incumbent directors up for re-election at the June 22 meeting, including Mr. Coury, CEO Heather Bresch and President Rajiv Malik.
Mylan issued a statement Monday expressing confidence that shareholders will realize the company’s board “has overseen a period of strong and sustainable long-term growth” and that ISS’ recommendation to vote down 10 board members “and leave the company without any leadership is simply irrational and not in the best interests of the company, its shareholders and other stakeholders.”
Glass Lewis is recommending no votes for three of the incumbent directors who are on the Mylan committee that sets compensation policy but is supporting the re-election of Mr. Coury, Ms. Bresch and Mr. Malik. Mylan had no comment on that recommendation.
Last month, four large pension funds wrote to Mylan shareholders urging them to vote against Mr. Coury and five other incumbent directors, citing Mylan’s “extraordinary and egregious” pay. The pension funds own less than 1 percent of Mylan’s shares.
Mylan reincorporated in the Netherlands in 2015 to lower its tax bill. Operations continue to be run from executive offices in Cecil.
Mylan shares closed Monday at $38.88, down $1.21. They are up 2 percent this year.