In 2022, the highest-paid R&D executive made $12.2 million. John Reed, M.D., Ph.D., of Johnson & Johnson is telling the rest of the field to hold his beaker.
The former Sanofi R&D chief made more than $20 million in his first year, though much of it was sourced to restricted share units offered when Reed took the gig. The $11.7 million in shares replaced $6.2 million in Sanofi equity that he forfeited when he left in addition to $5.5 million in J&J equity incentives.
Reed’s direct compensation for the year was just north of $8.5 million, $6 million of which was in long-term incentives. Reed’s base salary is $840,385, the lowest among J&J’s named executive officers. Reed also totaled the most perquisite and personal benefit expenditures among all of the company’s top execs, including CEO Joaquin Duato, totaling almost $250,000. Some $58,000 of that was tied to relocation expenses, but another $183,000 included use of the company aircraft.
The $20 million-plus package is a significant amount of cash for the new hire, whose appointment was announced just more than a year ago in February 2023. The most comparable former J&J executive listed in recent proxies would be Paul Stoffels, M.D., who was J&J’s chief scientific officer for more than 10 years before leaving to lead Galapagos. In 2021, his final full year, Stoffels made $3.2 million in direct compensation, a depressed figure compared to his fellow execs because he retired before earning a long-term compensation package in February 2022. The year before that, Stoffels made $11.2 million.
Reed’s first-year compensation also outpaces last year’s highest-paid R&D executives. That list was led by Pfizer’s Mikael Dolsten, M.D., Ph.D., who made $12.2 million.
J&J’s R&D strategy has changed dramatically in the past year, spurring cuts to employees across the globe. Some of that work stems from divesting in infectious diseases and vaccines, a plan that was implemented before Reed was hired. But just recently, the company told staff that a nearly 200,000-square-foot facility in the Bay Area that opened in September 2022 would close, which, along with ID&V staff, included RNA and gene therapy scientists.