Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) paid its former CEO Dr. Jeremy Levin total compensation of $7.2 million in 2013, according to the 20-F report that it filed with the US Securities and Exchange Commission. Levin's basic salary was $1.2 million. He was awarded a bonus in a similar amount, and was paid stock-based compensation amounting to $1.4 million. Another manager who left Teva, Aharon Yaari, who went to Oil Refineries Ltd. (TASE:ORL), was paid $4.8 million. In both cases, a substantial amount of the compensation was represented by severance pay.
Of Teva's current senior management, the highest paid last year was Dr. Michael Hayden, president of global R&D and chief scientific officer, whose compensation totaled $3.2 million. His basic salary was $1 million, and he received a bonus of $667,000 and stock-based compensation amounting to $644,000. Hayden was also entitled to a payment for his accommodation in Israel amounting to $107,000.
Prof. Itzhak Krinsky, who manages Teva's activity in Asia, received total compensation of $3.1 million, and chief legal officer Richard Egosi received $3 million. CFO Eyal Desheh, who was acting CEO after Levin left the company, is not among Teva's five highest paid officers. Tomorrow, Erez Vigodman takes up the CEO position. His annual compensation will be $4.1 million, subject to approval by the shareholders and on the basis of meeting goals.
Teva awarded its employees 1.7 million options in 2013 at an average exercise price of $38.4 per share, which is lower than the current market price. At the end of 2013, Teva employees held 17.1 million options exercisable at an average price of $47.3 per share, which is higher than the current market price.
In 2013, Teva announced a streamlining plan designed to save $2 billion annually. It involves laying off 10% of the workforce. The layoffs are due to be implemented this year, but meanwhile Teva's workforce shrank by 2.2% in 2103 to 44,945. In Israel, the headcount fell by 234 (3.2%) to 7,163.
Teva's provision for taxation in 2013 was 15% ($197 million), considerably more than in previous years. In 2012, Teva paid a near zero rate of tax in Israel. The average rate for the previous decade was 6%.
The report reveals that at the beginning of 2014 an investigation was opened in the US into the sales of two of Teva's ethical drugs, Copaxone and Azilect. The US administration is examining possible violations of Federal law, and has required Teva to produce documents. The company says that it is in the process of handing over the documents in question.
Published by Globes [online], Israel business news - www.globes-online.com - on February 10, 2014
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