DEF 14A of Amylyx Pharmaceuticals, Inc.
Filed Apr 24, 2024 · FY20230000950170-24-047243
PROPOSAL NO. 1 – ELECTION OF CLASS III DIRECTORS
PROPOSAL NO. 1 – ELECTION OF CLASS III DIRECTORS Our board of directors currently consists of seven members. In accordance with the terms of our certificate of incorporation, our board of directors is divided into three classes, Class I, Class II and Class III, with members of each class serving staggered three-year terms. The terms of the Class III directors are scheduled to expire at the upcoming Annual Meeting. Based on the recommendation of the nominating and governance committee, our board of directors has nominated Joshua Cohen and Daphne Quimi for re-election as Class III directors at the Annual Meeting. The nominees are presently Class III directors, and each has indicated a willingness to continue to serve as a Class III director, if elected.
Nominees for Election as Class III Directors
Nominees for Election as Class III Directors The following table identifies our nominees for Class III directors, and their ages as of April 12, 2024.
Nominees for Election as Class III Directors
| Name | Positions and Offices Held with Amylyx | Director Since | Age | | Joshua Cohen | Co-Chief Executive Officer and Director | 2014 | 32 | | Daphne Quimi | Director | 2021 | 58 |
Nominees for Election as Class III Directors
Joshua Cohen has served as our Co-Chief Executive Officer and a member of our board of directors since January 2014. Mr. Cohen has a B.S. in Biomedical Engineering from Brown University. We believe that Mr. Cohen is qualified to serve on our board of directors because of his experience, qualifications, attributes and skills, including his familiarity with and experience building our company as its Co-Chief Executive Officer and Co-Founder, as well as his knowledge and familiarity with corporate management, neurodegenerative disease research and drug development. Daphne Quimi has served as a member of our board of directors since June 2021. Ms. Quimi has more than 25 years of executive experience in the pharmaceutical and biotechnology industries with expertise in global finance operations, company building, and rare disease drug commercialization. Ms. Quimi has served as the advisor to the chief financial officer of Amicus Therapeutics, Inc. (“Amicus”), a biotechnology company since August 2023. She previously served as chief financial officer of Amicus from January 2019 until August 2023 after holding various roles at Amicus since 2007. Ms. Quimi also serves on the board of directors at Century Therapeutics, Inc. (Nasdaq: IPSC) since October 2022. Prior to that, Ms. Quimi served as Director of Consolidations and External Reporting at Bristol-Myers Squibb Company, a global biopharmaceutical company, from 2005 to 2007. Ms. Quimi received a B.S. in Accountancy from Monmouth University and an M.B.A. from the Stern School of Business of New York University. We believe Ms. Quimi is qualified to serve on our board of directors due to her financial expertise and industry experience. Properly submitted proxies will be voted in favor of the above nominees unless a contrary specification is made in the proxy. Each of the nominees has consented to serve as a director if elected. However, if a nominee is unable or unwilling to serve or for good cause will not serve as a director, properly submitted proxies will be voted for the election of such substitute nominee as our board of directors may designate.
Directors Continuing in Office
Directors Continuing in Office The following table identifies our continuing directors and their ages as of April 12, 2024.
Directors Continuing in Office
| Name | Positions and Offices Held with Amylyx | Director Since | Class and Year in Which Term Will Expire | Age | | Justin Klee | Co-Chief Executive Officer and Director | 2014 | Class I—2025 | 33 | | Karen Firestone | Director | 2023 | Class I—2025 | 68 | | Bernhardt Zeiher, MD. | Director | 2024 | Class I—2025 | 60 | | George Mclean Milne Jr., Ph.D. | Chair of the Board of Directors | 2015 | Class II—2026 | 80 | | Paul Fonteyne | Director | 2021 | Class II—2026 | 62 |
Directors Continuing in Office
Justin Klee has served as our Co-Chief Executive Officer and a member of our board of directors since January 2014. Mr. Klee has a B.S. in Neuroscience from Brown University. We believe that Mr. Klee is qualified to serve on our board of directors because of his experience, qualifications, attributes and skills, including his familiarity with and experience building our company as its Co-Chief Executive Officer and Co-Founder, as well as his knowledge and familiarity with corporate management, neurodegenerative disease research and drug development. Karen Firestone has served as a member of our board of directors since March 2023. Ms. Firestone is Chairman, CEO, and co-founder of Aureus Asset Management, an investment firm that manages over $6 billion of assets for families, individuals, and non-profit entities, which role she has held since 2005. Previously, she spent 22 years at Fidelity Investments, most recently as a diversified fund manager of Destiny 1 Fund, the Large Cap Fund, Advisor Large Cap Fund and managing numerous sector funds, including Biotechnology, Health Care, and Media. Ms. Firestone is a Director of the Boys and Girls Clubs of Boston, Director and Chair of the Audit Committee of Hamilton Thorne Ltd. (HTLZF), and serves as a Trustee Emerita at the Beth Israel Deaconess Medical Center. She is a member of the Boston Athletic Association. Ms. Firestone received a Bachelor of Arts degree in economics, magna cum laude, from Harvard College and an MBA from Harvard Business School. We believe Ms. Firestone is qualified to serve on our board of directors because of her experience, qualifications, attributes and skills. Bernhardt Zeiher, M.D., has served as a member of our board of directors since March 2024. Dr. Zeiher previously held senior leadership positions at Astellas Pharma Inc. (“Astellas Pharma”), a publicly-traded global pharmaceutical company, including Chief Medical Officer from April 2019 to September 2022; Chief Medical Officer and President of Development from April 2018 to April 2019; President of Development from 2015 to April 2018, preceded by several roles of increasing responsibility beginning in 2010. Prior to joining Astellas Pharma, Dr. Zeiher held various leadership positions at Pfizer, Inc. (“Pfizer”), a global pharmaceutical company, including Vice President, Inflammation Disease Area Lead from 2009 to 2010; Executive Director, Inflammation and Pain Clinical Development from 2006 to 2009; and Senior Director, Inflammation and Pain Early Clinical Development from 2005 to 2006. Before joining Pfizer, Dr. Zeiher held various leadership positions at Eli Lilly, and Company, a global pharmaceutical company, including Medical Director from 2002 to 2005; Head, Critical Care Clinical Research from 2001 to 2002; and Clinical Research Physician from 2000 to 2001. Dr. Zeiher also worked as an Associate Medical Director at Merck & Co. Inc. from 1998 to 2000. In addition to his leadership roles in the pharmaceutical industry, Dr. Zeiher serves on the board of directors of Entrada Therapeutics, Inc. (Nasdaq: TRDA) since April 2023 and also served as a director at TransCelerate BioPharma Inc. from 2014 to 2022 and the Biotechnology Innovation Organization from 2019 to 2021. Dr. Zeiher received a B.S. in Biology from the University of Toledo, earned his Doctor of Medicine at the Case Western Reserve University School of Medicine, and completed an internal medicine residency at University Hospitals of Cleveland as well as a fellowship in Pulmonary and Critical Care Medicine at University of Iowa Hospitals and Clinics. He is also a Fellow in the American College of Physicians and the American College of Chest Physicians. We believe that Dr. Zeiher is qualified to serve on our board of directors due to his experience as a senior executive in the pharmaceutical industry, as well as his service on the boards of directors of several organizations. George Mclean Milne Jr., Ph.D. has served on our board of directors since 2015 and as chair of our board since December 2021. Dr. Milne has over 30 years of experience in pharmaceutical research and product development, including over 20 years of experience as a board member and lead director of multiple biopharmaceutical companies. He retired from Pfizer in 2002 where he served as Executive Vice President of Global Research and Development and President, Worldwide Strategic and Operations Management. He joined Pfizer in 1970 and held a variety of positions conducting both chemistry and pharmacology research. Dr. Milne became director of the department of immunology and infectious diseases at Pfizer in 1981, was its executive director from 1984 to 1985, and was Vice President of research and development from 1985 to 1988. He was appointed Senior Vice President in 1988. In 1993, he was appointed President of Pfizer Central Research and a Senior Vice President of Pfizer with global responsibility for human and veterinary medicine research and development. Dr. Milne has served on the board of directors of Aurinia Pharmaceuticals Inc. since 2017, Gaylord Specialty Healthcare since 2016, New York Botanical Garden since 1998, and Sea Research Foundation since 1995. Dr. Milne has also previously served on multiple corporate boards of directors, including Charles River Laboratories International, Inc. (NYSE: CRL), a laboratory services company from 2002 until 2022, BioStorage Technologies, Inc. from 2006 until 2016, MedImmune, Inc., a biotechnology company, and Mettler-Toledo, Inc., an instrument manufacturing company, among others. Dr. Milne has a B.S. in Chemistry from Yale University and a Ph.D. in Organic Chemistry from the Massachusetts Institute of Technology. We believe that Dr. Milne is qualified to serve on our board of directors because of his experience, qualifications, attributes and skills. Paul Fonteyne has served as a member of our board of directors since March 2021. Mr. Fonteyne is the retired chair and CEO of Boehringer-Ingelheim, USA (“BI”), a subsidiary of Boehringer Ingelheim International GmbH (“Boehringer”), a global pharmaceutical company. He was with BI or BI subsidiaries from 2003 to December 2018 and made substantial contributions to BI. Prior to 2003, Mr. Fonteyne served in leadership positions at Merck and Co. Inc. as well as Abbott Laboratories. He has served on the boards of directors of Apnimed Pharmaceuticals, a clinical-stage pharmaceutical company, since October 2023, Apellis Pharmaceuticals, a biotechnology company, since April 2020, DalCor, Inc., a pharmaceutical company, since 2019, Ypsomed AG, a biotechnology company, since 2018, and Gelesis Holdings, Inc., a biotechnology company, since April 2018. Mr. Fonteyne also served as a member of the board of directors of Covetrus Inc., an animal health company, from May 2021 until its merger with Corgi Bidco, Inc. in October 2022, ResTORbio Inc., a biotechnology company, from December 2017 until its reverse merger with Adicet Bio, Inc. in September 2020, as well as member of the board of directors of AMAG Pharmaceuticals, Inc. from November 2019 until its sale to Covis Group S.à.r.l. in November 2020. Mr. Fonteyne has also served on the board of the Pharmaceutical Research and Manufacturers of America, chaired the National Pharmaceutical Council and is actively participating as a founder in biopharma spinouts from Yale University in the fields of Alzheimer’s disease and pulmonary disease. Mr. Fonteyne received his M.B.A. from Carnegie-Mellon University and his M.S. in Chemical Engineering from the Polytechnic School at the University of Brussels. We believe Mr. Fonteyne is qualified to serve on our board of directors because of his experience, qualifications, attributes and skills, including his past experience in the life sciences industry.
Directors Continuing in Office
There are no family relationships between or among any of our directors or executive officers. There is no arrangement or understanding between any of our directors and any other person or persons pursuant to which he or she is to be selected as a director. There are no material legal proceedings to which any of our directors is a party adverse to us or our subsidiary or in which any such person has a material interest adverse to us.
Executive Compensation Program Overview
Executive Compensation Program Overview Our compensation committee seeks to ensure that our executive compensation program is aligned with the interest of our stockholders and our business goals and that the total compensation paid to each of our named executive officers is fair, reasonable and competitive. Key elements of our executive compensation program include the following: Base Salaries Fixed component of pay to provide financial stability and is based on responsibilities, experience, individual contributions and peer company data. Annual Bonuses • To promote and reward the achievement of key short-term strategic and business goals of the Company as well as individual performance; to motivate and attract executives. • Variable component of pay based on annual quantitative and qualitative company and individual goals. Equity Compensation • To encourage executives and other employees to focus on long-term company performance; to promote retention; to reward outstanding company and individual performance. • Typically subject to multi-year vesting based on continued service and primarily in the form of stock options and RSUs, the value of which depends on the performance of our common stock price, in order to align employee interests with those of our stockholders over the longer-term. We have designed our executive compensation program to embody a pay-for-performance philosophy that supports our business strategy and aligns the interests of our executive officers with our stockholders. We believe this link between compensation and the achievement of our near and long-term business goals has helped drive our performance over time. At the same time, we believe our program does not encourage excessive risk-taking by management.
Role of the Compensation Consultant
Role of the Compensation Consultant In connection with fulfilling its duties, the compensation committee recognizes that there is value in procuring independent, objective expertise and counsel, and has the authority to retain an independent compensation consultant to assist it in carrying out its responsibilities and duties. Our compensation committee engaged Pearl Meyer as its independent compensation consultant to advise on executive compensation matters for 2023, including overall compensation program design, peer group development and updates, and director and executive compensation benchmarking. We develop our compensation programs after reviewing publicly available compensation data and data for our peer group, as provided by Pearl Meyer. The board of directors and the compensation committee consider Pearl Meyer’s data, analysis and recommendations on certain compensation matters as they deem appropriate. Pearl Meyer reports directly to our compensation committee and the committee has the sole authority to retain, terminate and obtain the advice of Pearl Meyer at the Company’s expense. Our compensation committee has assessed the independence of Pearl Meyer consistent with Nasdaq listing standards and has concluded that the engagement of Pearl Meyer does not raise any conflicts of interest.
Defining and Comparing Compensation to Market Benchmarks
Defining and Comparing Compensation to Market Benchmarks In evaluating the total compensation of our NEOs, our compensation committee, using information provided by Pearl Meyer, annually reassesses a peer group of 16-20 U.S. based public companies in the biotechnology and pharmaceuticals industries. The peer group is selected based on a balance of criteria such as number of employees, stage of development and market capitalization. Based on this criteria, our peer group for 2023 compensation decisions, referred to as our 2023 peer group, was approved by our compensation committee in November 2022 and was comprised of the companies listed below.
Defining and Comparing Compensation to Market Benchmarks
| Peer Group | | | Acadia Pharmaceuticals Inc. | Insmed Incorporated | | Agios Pharmaceuticals, Inc. | Karuna Therapeutics, Inc. | | Amicus Therapeutics, Inc. | Myovant Sciences Ltd. | | Apellis Pharmaceuticals, Inc. | Rhythm Pharmaceuticals, Inc. | | Axsome Therapeutics, Inc. | Sage Therapeutics, Inc. | | BioCryst Pharmaceuticals, Inc. | Sarepta Therapeutics, Inc. | | Blueprint Medicines Corporation | Supernus Pharmaceuticals, Inc. | | BridgeBio Pharma, Inc. | Travere Therapeutics, Inc. | | Corcept Therapeutics Incorporated | Xencor, Inc. | | Harmony Biosciences Holdings, Inc. | |
Primary Elements of Executive Compensation
| | 2023 Target Annual Bonus | | | Name | Percentage of Base Salary | ($) | | Joshua Cohen | 70% | 434,700 | | Justin Klee | 70% | 434,700 | | James Frates | 45% | 229,500 | | Gina M. Mazzariello | 45% | 207,000 | | Camille L. Bedrosian, MD (1) | n/a | n/a | | Margaret Olinger | 45% | 219,938 |
Primary Elements of Executive Compensation
| Name | Level of Achievement of Corporate Performance Goals | Level of Achievement of Individual Performance Goals | Percent of Target Annual Bonus Earned | Annual Bonus Earned ($) | | Joshua Cohen | 103% | n/a | 103% | 447,741 | | Justin Klee | 103% | n/a | 103% | 447,741 | | James Frates | 103% | 115% | 105% | 241,663 | | Gina M. Mazzariello | 103% | 114% | 105% | 217,765 | | Camille L. Bedrosian, MD (1) | n/a | n/a | n/a | n/a | | Margaret Olinger | 103% | 108% | 102% | 225,216 |
Primary Elements of Executive Compensation
(1) No target annual bonus for 2023 is listed for Dr. Bedrosian because she was not eligible for the 2023 bonus program due to her start date being after September 30, the eligibility cut-off for new hires. Initial Sign-On Bonus In connection with Dr. Bedrosian’s commencement of employment with us, Dr. Bedrosian received a $273,000 initial sign on bonus which is payable in two installments. The first installment of $173,000 was paid within 30 days of her start date, and the remaining $100,000 will be paid within 30 days of the date that Dr. Bedrosian obtains a residence in the greater-Boston, Massachusetts area to be closer to our headquarters. The after-tax portion of such sign on bonus is subject to repayment in the event that Dr. Bedrosian is terminated by us for cause or she resigns without good reason, in each case, prior to the first anniversary of her start date. Additionally, in the event that Dr. Bedrosian does not obtain a residence in the greater-Boston, Massachusetts area within 18 months of her start date, she will not be eligible to receive the second installment of such sign on bonus. Equity Compensation Overview Although we do not have a formal policy with respect to the grant of equity incentive awards to our NEOs, we believe that equity incentive awards provide our NEOs with a strong link to our long-term performance, create an ownership culture and help to align the interests of our NEOs and our stockholders. In addition, we believe that equity grants with a time-based vesting feature promote executive retention because this feature incents our NEOs to remain in our employment during the vesting period. The compensation committee typically recommends for approval by the board of directors long-term incentive grants for named executive officers at the start of their employment, and annually thereafter in connection with their annual performance review. Additionally, the board of directors may periodically, on a limited and judicious basis, grant additional equity awards based on individual role, performance and contribution, as well as competitive market data and information. The compensation committee typically grants, or recommends that the board of directors grant, long-term equity incentive awards for Named Executive Officers at the start of their employment, and annually thereafter in connection with their annual performance review. Additionally, the compensation committee or board of directors may periodically, on a limited and judicious basis, grant additional equity incentive awards based on individual role, performance and contribution, as well as competitive market data and information. Annual Equity Incentive Awards For 2023, the long-term equity incentive component of each Named Executive Officer’s compensation was partially in the form of stock options and partially in the form of restricted stock units (“RSUs”). Each stock option vests over four years, with 25% of the shares subject to the option vesting on the first anniversary of the date of grant and the remaining shares vesting in 36 equal monthly installments thereafter. Each RSU award vests in equal annual installments over four years. Annual awards are based on a blend of market and value data, which is used to grant a fixed number of stock options and RSUs. The following table sets forth number of shares for each such award granted to our Named Executive Officers.
Primary Elements of Executive Compensation
| | Stock Options | RSUs | | Name | Number of Shares (#) | Number of Shares (#) | | Joshua Cohen | 225,000 | 50,000 | | Justin Klee | 225,000 | 50,000 | | James Frates | 97,500 | 21,667 | | Gina M. Mazzariello | 82,500 | 18,333 | | Margaret Olinger | 82,500 | 18,333 |
Primary Elements of Executive Compensation
Initial Equity Incentive Awards In connection with Dr. Bedrosian’s commencement of employment with us, we granted Dr. Bedrosian initial equity incentive awards in the form of an option to purchase 162,500 shares of our common stock and 58,333 RSUs. Similar to the annual equity incentive awards for 2023, Dr. Bedrosian’s initial option award vests over four years, with 25% of the shares subject to the option vesting on the first anniversary of her start date and the remaining shares vesting in 36 equal monthly installments thereafter. Dr. Bedrosian’s RSUs vest in equal annual installments over four years, commencing from the first day of the calendar month following her start date. Other Benefits Retirement Plans We maintain a tax-qualified 401(k) plan that provides eligible U.S. employees with an opportunity to save for retirement on a tax-advantaged basis. Plan participants are able to defer eligible compensation subject to applicable annual Internal Revenue Code limits. We provide a safe-harbor contribution of 3% of employee compensation to employees who satisfy the minimum service requirements. The percentage of company contributions for eligible Named Executive Officers are the same percentage as for other eligible employees. Perquisites and Welfare Benefits Our Named Executive Officers are eligible to participate in our employee benefit plans on the same basis as our other employees, including our health and welfare plans. We do not provide our Named Executive Officers with automobiles or reimbursement for country clubs, financial planning or things of a similar nature. In connection with Dr. Bedrosian’s commencement of employment with us, we provided her with reimbursement of reasonable travel-related expenses in connection with her travel to and from her residence in San Rafael, California to our headquarters.
Employment Agreements
Employment Agreements We have entered into employment agreements with each of our Named Executive Officers which provide for “at will” employment. For additional information regarding the material terms of each Named Executive Officer’s employment agreement, please see the section below titled “Employment Arrangements with our Named Executive Officers.”
Compensation Policies and Practices
Compensation Policies and Practices We endeavor to maintain sound governance standards consistent with our executive compensation policies and practices. The compensation committee reviews our executive compensation program on an annual basis to ensure consistency with our short-term and long-term goals given the dynamic nature of our business and the market in which we compete for executive talent. The following summarizes our executive compensation-related policies and practices that were in effect during 2023. What We Do • Maintain Independent compensation committee. The compensation committee is comprised solely of independent directors who determine our compensation policies and practices; Retain an Independent Compensation Adviser. The compensation committee engaged its own independent compensation consultant to provide information and analysis with its 2023 compensation review, and other advice on executive compensation; Annual Executive Compensation Review. The compensation committee reviews and approves our compensation strategy annually, including a review of our compensation peer group used for comparative purposes; • Compensation At-Risk . Our executive compensation program is designed so that a significant portion of our NEOs' compensation is “at risk” based primarily on corporate performance, as well as equity-based, to align the interests of our NEOs and stockholders; and • Multi-Year Vesting Requirements . The annual equity awards granted to our NEOs vest over multi-year periods, consistent with current market practice and our retention objectives. What We Don’t Do • No Executive Pension Plans or Supplemental Retirement Plans. We do not offer, nor do we have plans to offer, any defined benefit pension plans, supplemental retirement plans, or non-qualified deferred compensation plans or arrangements to our NEOs; • No Guaranteed Cash Payments. We do not provide our NEOs with guaranteed base salary increases; and • No Hedging or Pledging. We do not allow any hedging or pledging by NEOs or directors. Hedging and Pledging Policy Our board of directors has adopted a policy which prohibits our directors, officers and employees from (i) engaging in any hedging transactions involving company securities or from purchasing or selling any put or call option contract or similar instrument with respect to company securities, and (ii) pledging company securities as collateral for a loan or holding such shares in a margin account. Compensation Recovery Policy • In light of the SEC’s adoption of final clawback rules in October 2022 and the Nasdaq’s adoption of final listing standards consistent with the SEC rules in June 2023, we adopted a Compensation Recovery Policy on October 2, 2023. If we are required to prepare an accounting restatement due to material non-compliance with any financial reporting requirements, the Compensation Recovery Policy requires (subject to certain limited exceptions described in the policy and permitted by the final clawback rules) that we recover erroneously awarded compensation received by any current or former executive officer in the three fiscal years prior to the date we were required to restate our financial statements that is in excess of the amount that would have been received based on the restated financial statements.
2023 Summary Compensation Table
2023 Summary Compensation Table The following table provides information regarding the total compensation awarded to, earned by, and paid to our named executive officers in the years indicated.
2023 Summary Compensation Table
| Name and Principal Position | Year | Salary $ | Bonus ($) | Stock Awards ($)(1) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(3) | All Other Compensation ($)(4) | Total ($) | | Joshua Cohen Co-Chief Executive Officer and Director | 2023 | 621,000 | — | 1,604,000 | 4,733,928 | 447,741 | 11,500 | 7,418,169 | | | 2022 | 539,275 | — | 1,425,000 | 4,752,000 | 452,991 | 9,150 | 7,178,416 | | | 2021 | 417,833 | — | — | 698,000 | 300,000 | 8,700 | 1,424,533 | | Justin Klee Co-Chief Executive Officer and Director | 2023 | 621,000 | — | 1,604,000 | 4,733,928 | 447,741 | 11,500 | 7,418,169 | | | 2022 | 539,275 | — | 1,425,000 | 4,752,000 | 452,991 | 9,150 | 7,178,416 | | | 2021 | 417,833 | — | — | 698,000 | 300,000 | 8,700 | 1,424,533 | | James Frates Chief Financial Officer | 2023 | 510,000 | — | 695,077 | 2,052,137 | 241,663 | 11,500 | 3,510,377 | | | 2022(5) | 439,500 | — | 601,673 | 2,362,150 | 246,472 | 9,150 | 3,658,945 | | | 2021 | 375,000 | 615,000 | — | 2,052,080 | 205,120 | 8,700 | 3,255,900 | | Gina M. Mazzariello Chief Legal Officer and General Counsel | 2023 | 460,000 | — | 588,123 | 1,736,288 | 217,765 | 11,500 | 3,013,676 | | | 2022(6) | 342,593 | 250,000 | 1,229,180 | 4,089,540 | 193,085 | 9,150 | 6,113,548 | | Camille L. Bedrosian, M.D. Chief Medical Officer | 2023(7) | 56,763 | 173,000 | 754,246 | 1,386,012 | — | 2,838 | 2,372,859 | | Margaret Olinger Former Chief Commercial Officer | 2023(8) | 488,750 | — | 618,194 | 1,736,927 | 225,216 | 378,063(9) | 3,447,150 | | | 2022 | 424,337 | — | 538,327 | 1,795,200 | 228,803 | 9,150 | 2,995,817 | | | 2021 | 372,000 | — | — | 296,400 | 186,298 | 8,700 | 863,398 |
2023 Summary Compensation Table
(1) Amounts shown reflect the grant date fair value of RSUs awarded during fiscal years 2023, 2022 and 2021, determined in accordance with Financial Accounting Standards Board, Accounting Standards Codification Topic 718, Compensation—Stock Compensation (“FASB ASC Topic 718”). Such grant date fair values do not take into account any estimated forfeitures. The assumptions used in calculating the grant date fair value of the awards reported in this column are set forth in Note 13 to our consolidated financial statements included in our 2023 Annual Report. The amounts reported in this column reflect the accounting cost for the RSUs and do not correspond to the actual economic value that may be received upon vesting or settlement of the RSUs or sale of any of the underlying shares of common stock. (2) The amounts reported represent the aggregate grant date fair value of the stock options awarded to the named executive officers and the incremental fair value of option awards materially modified during fiscal years 2023, 2022 and 2021, calculated in accordance with FASB ASC Topic 718. Such grant date fair value does not take into account any estimated forfeitures. The assumptions used in calculating the grant date fair value of the awards reported in this column are set forth in Note 13 to our consolidated financial statements included in our 2023 Annual Report. The amounts reported in this column reflect the accounting cost for the stock options and do not correspond to the actual economic value that may be received upon vesting or exercise of the stock options or sale of any of the underlying shares of common stock. (3) The amounts reported for 2023, 2022 and 2021 represent annual incentive bonuses earned in 2023, 2022 and 2021 and paid in February 2024, February 2023 and February 2022, respectively, based on the achievement of pre-established performance goals as determined by our board of directors. (4) Except as otherwise noted, the amounts reported in the “All Other Compensation” column represent safe harbor employer contributions under our 401(k) Plan. Mr. Frates joined our company as our Chief Financial Officer in January 2021, and the amounts reported in the “Salary” column represent salary payments earned following his commencement of employment. The amount reported in the “Bonus” column represents bonus payments to Mr. Frates pursuant to his employment agreement, including a $325,000 signing bonus and a $290,000 one-time additional bonus. Pursuant to the terms of his employment agreement, Mr. Frates was obligated to repay the signing bonus in the event that he terminated his employment with us other than for “good reason” or was terminated by us other than for “just cause” prior to January 25, 2023. Ms. Mazzariello joined our company as our Chief Legal Officer and General Counsel in February 2022, and the amounts reported in the “Salary” column represent salary payments earned following her commencement of employment. The amount reported in the “Bonus” column represents a $250,000 signing bonus paid to Ms. Mazzariello pursuant to her employment agreement. Pursuant to the terms of her employment agreement, Ms. Mazzariello was obligated to repay the signing bonus in the event that she terminated her employment with us other than for “good reason” or was terminated by us other than for “just cause” prior to February 22, 2023. (7) Dr. Bedrosian joined our company as our Chief Medical Officer in November 2023, and the amounts reported in the “Salary” column represent salary payments earned following her commencement of employment. The amount reported in the “Bonus” column represents a $173,000 signing bonus paid to Dr. Bedrosian pursuant to her employment agreement. Pursuant to the terms of her employment agreement, Dr. Bedrosian is obligated to repay the after-tax portion of the signing bonus in the event that she terminates her employment with us other than for “good reason” or is terminated by us for “cause” prior to November 27, 2024. (8) Margaret Olinger separated from the Company as the Company’s Chief Commercial Officer effective as of end of day on December 31, 2023. Pursuant to a separation agreement, Ms. Olinger received (i) $366,563 cash severance, and (ii) extended exercisability of her vested stock options until the earlier of six months after her date of termination or the original expiration date of such option. The amount reported in the “Option Awards” column includes $30,071, equal to the incremental fair value resulting from such modifications to Ms. Olinger’s option awards described in this footnote, Computed in accordance with FASB ASC Topic 718. Amount reported includes (i) $11,500 in safe harbor employer contributions under our 401(k) Plan, and (ii) $366,563 cash severance paid pursuant to Ms. Olinger’s separation agreement, as described in Footnote 8 above.
2023 Grants of Plan-Based Awards
2023 Grants of Plan-Based Awards The following table provides supplemental information relating to grants of plan-based awards made during fiscal 2023 to help explain information provided above in our Summary Compensation Table. This table presents information regarding all grants of plan-based awards occurring during fiscal 2023.
2023 Grants of Plan-Based Awards
| | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | | | | | | | | Name | Grant Date | Threshold ($) | Target ($) (1) | Maximum ($) | All other Stock Awards: Number of Shares of Stock or units (#) | All other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/Sh) (2) | Grant date fair value of Stock and Option Awards ($) (3) | | Joshua Cohen | | — | 434,700 | 652,050 | | | | | | | 3/16/2023 | | | | 50,000 | — | | 1,604,000 | | | 3/16/2023 | | | | — | 225,000 | 32.08 | 4,733,928 | | Justin Klee | | — | 434,700 | 652,050 | | | | | | | 3/16/2023 | | | | 50,000 | — | | 1,604,000 | | | 3/16/2023 | | | | — | 225,000 | 32.08 | 4,733,928 | | James Frates | | — | 229,500 | 344,250 | | | | | | | 3/16/2023 | | | | 21,667 | — | | 695,077 | | | 3/16/2023 | | | | — | 97,500 | 32.08 | 2,052,137 | | Camille L. Bedrosian, M.D. | | — | n/a | n/a | | | | | | | 11/27/2023 | | | | 58,333 | | | 754,246 | | | 11/27/2023 | | | | | 162,500 | 12.93 | 1,386,012 | | Gina M. Mazzariello | | — | 207,000 | 310,500 | | | | | | | 3/16/2023 | | | | 18,333 | — | | 588,123 | | | 3/16/2023 | | | | — | 82,500 | 32.08 | 1,736,288 | | Margaret Olinger | | — | 219,938 | 329,906 | | | | | | | 3/16/2023 | | | | 18,333 | — | | 588,123 | | | 3/16/2023 | | | | — | 82,500 | 32.08 | 1,736,927 | | | 12/31/2023(4) | | | | — | 463,660 | — | 30,071 |
2023 Grants of Plan-Based Awards
(1) Represents the target amount of each NEO’s cash payments under our annual bonus program as described in “Compensation Discussion and Analysis” above. Actual payments made for 2023 are provided in the “Summary Compensation Table.” As there are no threshold or maximum amounts with respect to these cash payments, the columns “Threshold ($)” and “Maximum ($)” are inapplicable and therefore have been omitted from this table. (2) The exercise price of these stock options is equal to the closing price of our common stock on the Nasdaq Global Select Stock Market on the grant date. (3) Amounts shown reflect the grant date fair value of RSUs and stock options awarded during fiscal year 2023, determined in accordance with FASB ASC Topic 718. Such grant date fair values do not take into account any estimated forfeitures. The assumptions used in calculating the grant date fair value of the awards reported in this column are set forth in Note 13 to our consolidated financial statements included in our 2023 Annual Report. (4) The number of shares and grant date fair value reported does not reflect the grant of new awards, but represents the incremental fair value resulting from the modification of Ms. Olinger’s option awards described in footnote 8 to the Summary Compensation Table above, which is calculated by computing the excess of the fair value of the modified option awards at the date of modification over the grant date fair value of the original options. The exercise price of such stock options was not modified and ranged from $0.37 to $19 per share.
Outstanding Equity Awards at Fiscal 2023 Year-End
Outstanding Equity Awards at Fiscal 2023 Year-End The following table sets forth information regarding outstanding equity awards held by our named executive officers as of December 31, 2023.
Outstanding Equity Awards at Fiscal 2023 Year-End
| | | Option Awards (1)(3) | | | | Stock Awards (2)(3) | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(4) | | Joshua Cohen | 2/26/2020(5) | 32,140 | 4,166 | 1.57 | 2/26/2025 | — | — | | | 2/19/2021(6) | 141,676 | 58,324 | 7.57 | 2/19/2026 | — | — | | | 1/6/2022 | 161,718 | 175,782 | 19.00 | 1/6/2032 | — | — | | | 1/6/2022 | — | — | — | — | 56,250 | 828,000 | | | 3/16/2023 | — | 225,000 | 32.08 | 3/16/2033 | — | — | | | 3/16/2023 | — | — | — | — | 50,000 | 736,000 | | Justin Klee | 2/26/2020(5) | 95,834 | 4,166 | 1.57 | 2/26/2025 | — | — | | | 2/19/2021(6) | 141,676 | 58,324 | 7.57 | 2/19/2026 | — | — | | | 1/6/2022 | 161,718 | 175,782 | 19.00 | 1/6/2032 | — | — | | | 1/6/2022 | — | — | — | — | 56,250 | 828,000 | | | 3/16/2023 | — | 225,000 | 32.08 | 3/16/2033 | — | — | | | 3/16/2023 | — | — | — | — | 50,000 | 736,000 | | James Frates | 1/25/2021(7) | 241,427 | 122,408 | 6.88 | 1/25/2031 | — | — | | | 1/6/2022 | 68,281 | 74,219 | 19.00 | 1/6/2032 | — | — | | | 1/6/2022 | — | — | — | — | 23,751 | 349,615 | | | 2/11/2022 | 11,458 | 13,542 | 19.63 | 2/11/2032 | — | — | | | 3/16/2023 | — | 97,500 | 32.08 | 3/16/2033 | — | — | | | 3/16/2023 | — | — | — | — | 21,667 | 318,938 | | Gina M. Mazzariello | 2/22/2022 | 83,416 | 98,584 | 28.24 | 2/22/2032 | — | — | | | 2/22/2022 | — | — | — | — | 30,750 | 452,640 | | | 3/16/2023 | — | 82,500 | 32.08 | 3/16/2033 | — | — | | | 3/16/2023 | — | — | — | — | 18,333 | 269,862 | | Camille L. Bedrosian, M.D. | 11/27/2023 | — | 162,500 | 12.93 | 11/26/2023 | — | — | | | 11/27/2023 | — | — | — | — | 58,333 | 858,662 | | Margaret Olinger | 5/13/2019(5) | 44,577 | — | 0.37 | 6/28/2024 | — | — | | | 2/19/2021(6) | 46,044 | — | 6.88 | 6/28/2024 | — | — | | | 1/6/2022 | 61,093 | — | 19.00 | 6/28/2024 | — | — |
Outstanding Equity Awards at Fiscal 2023 Year-End
(1) Except as otherwise set forth below, each stock option award vests over four years, with respect to 25% of the shares on the first anniversary of the grant date and the remaining 75% of the shares in 36 equal monthly installments thereafter, subject to the named executive officer’s continued service relationship with us on each applicable vesting date. (2) Each Stock Award represents RSUs which vest over four years in four equal annual installments following the grant date subject to the named executive officer’s continued service relationship with us on each vesting date. (3) Pursuant to their respective employment agreements, in the event that Mr. Klee or Mr. Cohen are terminated without cause or resign for good reason, their time-based stock options and RSUs will accelerate by twelve (12) months, and in the event that Mr. Klee, Mr. Cohen, Mr. Frates, Ms. Mazzariello or Ms. Bedrosian is terminated without cause or resigns for good reason within 3 months prior to or 12 months following a change in control, any unvested shares subject to the executive’s time-based stock options and RSUs will fully accelerate. (4) Represents the market value of the shares subject to RSUs based on the closing price of our common stock on December 29, 2023, the last trading day of the 2023 fiscal year, of $14.72. (5) 25,012 shares subject to this stock option vested on February 26, 2021 and the remainder is scheduled to vest thereafter in 36 monthly installments of 2,083 shares. (6) 50,024 shares subject to this stock option vest on February 19, 2022 and the remainder is scheduled to vest thereafter in 36 monthly installments of 4,166 shares. 113,024 shares subject to this stock option vest on January 25, 2022 and the remainder is scheduled to vest thereafter in 36 monthly installments of 9,416 shares.
Option Exercises and Stock Vested in Fiscal Year 2023
Option Exercises and Stock Vested in Fiscal Year 2023 The following table sets forth information concerning the exercise of options by each of the Named Executive Officers during the fiscal year ended December 31, 2023, as well as information regarding stock awards that vested during the fiscal year.
Option Exercises and Stock Vested in Fiscal Year 2023
| | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) (1) | Value Realized on Exercise ($) (2) | Number of Shares Acquired on Vesting (#) (3) | Value Realized on Vesting ($) (4) | | Joshua Cohen | 63,694 | 672,609 | 18,750 | 666,938 | | Justin Klee | — | — | 18,750 | 666,938 | | James Frates | 83,165 | 1,728,647 | 7,916 | 281,572 | | Gina M. Mazzariello | — | — | 10,250 | 364,388 | | Margaret Olinger | 45,000 | 805,650 | 7,083 | 251,942 |
Option Exercises and Stock Vested in Fiscal Year 2023
(1) Represents the shares of our common stock acquired upon the exercise of stock options during 2023. (2) Value realized on exercise of stock option awards does not represent proceeds from any sale of any common stock acquired upon exercise, but is determined by multiplying the number of shares acquired upon exercise by the difference between the exercise price of the option and the closing price of our common stock on the Nasdaq Global Select Market at each time of exercise. (3) Represents the shares of our common stock acquired upon the vesting of RSUs during 2023. (4) For RSUs, the value realized on vesting represents the closing price per share of our common stock on the vesting date multiplied by the number of shares that vested.
Pension Benefits in Fiscal Year 2023
Pension Benefits in Fiscal Year 2023 None of our Named Executive Officers are entitled to pension benefits or other payments of benefits pursuant to any plan following retirement.
Nonqualified Deferred Compensation in Fiscal Year 2023
Nonqualified Deferred Compensation in Fiscal Year 2023 None of our Named Executive Officers are entitled to benefits under any nonqualified defined contribution or nonqualified deferred compensation plans.
Potential Payments upon Termination or a Change in Control
Potential Payments upon Termination or a Change in Control The following table presents information concerning the estimated compensation and benefits that would be payable to each Named Executive Officer in the event of various qualifying terminations of employment and/or change-in-control situations. The payments and benefits set forth below are estimated assuming that such termination and/or change-in-control occurred on the last business day of the fiscal year ended December 31, 2023 and using the closing market price of our stock on that date of $14.72 per share.
Potential Payments upon Termination or a Change in Control
| Name | Benefit | Termination Without Cause or for Good Reason | Termination Without Cause or for Good Reason in Connection with a Change in Control (1) | | Joshua Cohen | Cash Severance | 621,000(2) | 1,583,550(3) | | | Acceleration of Equity Award Vesting | 2,035,800(4)(5) | 2,035,800(4)(5) | | | Health Benefits | 9,551(6) | 9,551(6) | | | Total | 2,666,351 | 3,628,901 | | Justin Klee | Cash Severance | 621,000(2) | 1,583,550(3) | | | Acceleration of Equity Award Vesting | 2,035,800(4)(5) | 2,035,800(4)(5) | | | Health Benefits | 19,122(6) | 19,122(6) | | | Total | 2,675,922 | 3,638,472 | | James Frates | Cash Severance | 382,500(2) | 739,500(3) | | | Acceleration of Equity Award Vesting | 1,628,232(4)(5) | 1,628,232(4)(5) | | | Health Benefits | 20,410(6) | 20,410(6) | | | Total | 2,031,142 | 2,388,142 | | Gina M. Mazzariello | Cash Severance | 345,000(2) | 667,000(3) | | | Acceleration of Equity Award Vesting | 722,502(4)(5) | 722,502(4)(5) | | | Health Benefits | 12,532(6) | 12,532(6) | | | Total | 1,080,034 | 1,402,034 | | Camille L. Bedrosian, M.D. | Cash Severance | 431,250(2) | 833,750(3) | | | Acceleration of Equity Award Vesting | 1,149,537(4)(5) | 1,149,537(4)(5) | | | Health Benefits | 7,449(6) | 7,449(6) | | | Total | 1,588,236 | 1,990,736 | | Margaret Olinger (7) | Cash Severance | 366,563(2) | — | | | Acceleration of Equity Award Vesting | — | — | | | Extension of Stock Options | 30,071(8) | — | | | Health Benefits | — | — | | | Total | 396,634 | — |
Potential Payments upon Termination or a Change in Control
(1) Reflects the amount of compensation payable to our named executive officers if they were terminated within three months prior to or twelve months following a change in control. (2) Represents 9 months’ (12 months’ for Messrs. Cohen and Klee) of the Named Executive Officer’s base salary. (3) Represents 1.0 times (1.5 times for Messrs. Cohen and Klee) the sum of the Named Executive Officer’s base salary and target annual bonus. (4) The value of the option vesting acceleration was calculated by multiplying the number of unvested shares underlying stock options subject to vesting acceleration as of December 31, 2023 by the difference between the closing price of our common stock as reported on the Nasdaq Global Market on December 29, 2023 and the exercise price for such unvested stock options. (5) The value of the RSU vesting acceleration was calculated by multiplying the number of unvested RSUs subject to vesting acceleration as of December 31, 2023 by the closing price of our common stock as reported on the Nasdaq Global Market on December 29, 2023. (6) Represents 9 months (12 months for Messrs. Cohen and Klee) of our contribution toward health insurance, based on our actual costs to provide health insurance to the named executive officer as of the date of termination. (7) As Ms. Olinger separated from the Company on December 31, 2023, the payments and benefits reported in this table represent amounts actually paid to Ms. Olinger pursuant to the separation and release agreement described above under the heading “Separation and Release Agreement with Margaret Olinger”. Ms. Olinger did not elect to receive continued health benefits under COBRA. (8) Represents the incremental fair value resulting from the extension of Ms. Olinger’s vested stock options pursuant to her separation and release agreement. Any portion of her equity awards that were not vested as of December 31, 2023 terminated immediately.
Pay Versus Performance
Pay Versus Performance In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and Item 402(v) of Regulation S-K, we are providing the following disclosure regarding "Compensation Actually Paid,” as determined under SEC rules, for our PEOs and non-PEO named executive officers (“NEOs”) as a group and Company financial performance for the fiscal years listed below. This disclosure does not necessarily reflect value actually realized by the executive or how our compensation committee evaluates compensation decisions in light of company or individual performance. The compensation committee did not consider the pay versus performance disclosure below in making its pay decisions for any of the years shown.
Pay Versus Performance
| | | | | | | | Value of Initial Fixed $100 Investment Based On: (5) | | | | | Year | Summary Compensation Table Total for Joshua Cohen ($) | Summary Compensation Table Total for Justin Klee ($) | Compensation Actually Paid to Joshua Cohen ($) (4) | Compensation Actually Paid to Justin Klee ($) (4) | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs ($) (4) | Total Shareholder Return ($) | Peer Group Total Shareholder Return ($) | Net Income (Thousands) ($) | Product Revenue, Net (Thousands) ($) (6) | | 2023 (1) | 7,418,169 | 7,418,169 | (6,397,526) | (6,397,526) | 3,086,015 | (3,219,394) | 81 | 94 | 49,271 | 380,786 | | 2022 (2) | 7,178,416 | 7,178,416 | 18,570,310 | 18,570,310 | 4,256,103 | 10,183,063 | 204 | 90 | (198,375) | 22,230 | | 2021 (3) | 1,424,533 | 1,424,533 | 2,586,997 | 2,586,997 | 2,059,649 | 3,033,721 | n/a | n/a | (87,931) | — |
Pay Versus Performance
(1) For 2023, the PEOs were our Co-Chief Executive Officers, Joshua Cohen and Justin Klee, and the non-PEO NEOs were James Frates, Gina M. Mazzariello, Camille L. Bedrosian, M.D. and Margaret Olinger. (2) For 2022, the PEOs were our Co-Chief Executive Officers, Joshua Cohen and Justin Klee, and the non-PEO NEOs were James Frates, Gina M. Mazzariello and Margaret Olinger. (3) For 2021, the PEOs were our chief executive officers, Joshua Cohen and Justin Klee, and the non-PEO NEOs were James Frates and Gina M. Mazzariello. (4) Compensation Actually Paid reflects the total compensation reported in the Summary Compensation Table for the applicable year adjusted to include or exclude the amounts shown in the tables below for the NEOs. To calculate Compensation Actually Paid, the following amounts were deducted from and added to the Summary Compensation Table total compensation, computed in accordance with Item 402(v) of Regulation S-K: PEO Summary Compensation Total to Compensation Actually Paid Reconciliation
Pay Versus Performance
| Year | Summary Compensation Total for Joshua Cohen ($) | Deduction of Equity Awards for Joshua Cohen ($) (a) | Addition of Adjusted Equity Awards for Joshua Cohen ($) (b) | Compensation Actually Paid to Joshua Cohen ($) | | 2023 | 7,418,169 | (6,337,928) | (7,477,767) | (6,397,526) | | 2022 | 7,178,416 | (6,177,000) | 17,568,894 | 18,570,310 | | 2021 | 1,424,533 | (698,000) | 1,860,464 | 2,586,997 |
Pay Versus Performance
| Year | Summary Compensation Total for Justin Klee ($) | Deduction of Equity Awards for Justin Klee ($) (a) | Addition of Adjusted Equity Awards for Justin Klee ($) (b) | Compensation Actually Paid to Justin Klee ($) | | 2023 | 7,418,169 | (6,337,928) | (7,477,767) | (6,397,526) | | 2022 | 7,178,416 | (6,177,000) | 17,568,894 | 18,570,310 | | 2021 | 1,424,533 | (698,000) | 1,860,464 | 2,586,997 |
Pay Versus Performance
Average non-PEO NEOs Summary Compensation Total to Compensation Actually Paid Reconciliation
Pay Versus Performance
| Year | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Deduction of Equity Awards for Non-PEO NEOs ($) (a) | Average Addition of Adjusted Equity Awards for Non-PEO NEOs ($) (b) | Average Compensation Actually Paid to Non-PEO NEOs ($) | | 2023 | 3,086,015 | (2,391,751) | (3,913,659) | (3,219,394) | | 2022 | 4,256,103 | (3,538,690) | 9,465,650 | 10,183,063 | | 2021 | 2,059,649 | (1,174,240) | 2,148,312 | 3,033,721 |
Pay Versus Performance
(a) Represents the grant date fair value of equity-based awards granted each year and reported in the Summary Compensation Table for each year shown. See the footnotes to the Summary Compensation Table for further detail regarding the amounts in this column. (b) Reflects the value of equity calculated in accordance with the SEC methodology for determining the compensation actually paid for each year shown. The amounts in the Addition of Adjusted Equity Awards in the tables above are derived from the amounts set forth in the following tables:
Pay Versus Performance
| Year | Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Joshua Cohen ($) | Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Joshua Cohen ($) | Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for Joshua Cohen ($) | Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Joshua Cohen ($) | Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Joshua Cohen ($) | Total - Addition of Adjusted Equity Awards for Joshua Cohen ($) | | 2023 | 2,907,378 | (5,721,351) | — | (4,663,794) | — | (7,477,767) | | 2022 | 12,131,046 | 3,666,615 | — | 1,771,232 | — | 17,568,894 | | 2021 | 974,586 | 99,309 | — | 786,569 | — | 1,860,464 |
Pay Versus Performance
| Year | Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Justin Klee ($) | Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Justin Klee ($) | Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for Justin Klee ($) | Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Justin Klee ($) | Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Justin Klee ($) | Total - Addition of Adjusted Equity Awards for Justin Klee ($) | | 2023 | 2,907,378 | (5,721,351) | — | (4,663,794) | — | (7,477,767) | | 2022 | 12,131,046 | 3,666,615 | — | 1,771,232 | — | 17,568,894 | | 2021 | 974,586 | 99,309 | — | 786,569 | — | 1,860,464 |
Pay Versus Performance
| Year | Average Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Non-PEO NEOs ($) | Average Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Non-PEO NEOs ($) | Average Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Non-PEO NEOs ($) | Total - Addition of Adjusted Equity Awards for Non-PEO NEOs ($) | | 2023 | 1,199,553 | (1,766,664) | — | (2,651,863) | (696,708) | (3,913,659) | | 2022 | 5,235,934 | 2,712,055 | — | 1,515,639 | — | 9,465,650 | | 2021 | 1,341,877 | 71,039 | — | 733,376 | — | 2,148,312 |
Pay Versus Performance
The above tables omit columns relating to adjustments necessary for awards granted during the applicable year that vested during the same year or any dividends paid during the applicable year, in each case, because no such adjustments were applicable. (5) The Peer Group TSR set forth in this table utilizes the NASDAQ Biotechnology Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report for the year ended December 31, 2023. The comparison assumes $100 was invested for the period starting January 7, 2022, the date of the Company’s initial public offering, through the end of the listed year in the Company and in the NASDAQ Biotechnology Index, respectively. Historical stock performance is not necessarily indicative of future stock performance. Product revenue, net is a GAAP measure reported in the Company’s consolidated statements of operations. We did not use any financial performance measure when setting compensation goals and making compensation decisions for our NEOs in 2022 and 2021. We may determine a different financial performance measure to be the most important financial performance measure in future years. Description of Relationship Between PEO and non-PEO NEO Compensation Actually Paid and Company Total Shareholder Return (“TSR”) The following chart sets forth the relationship between Compensation Actually Paid to our PEO, the average of Compensation Actually Paid to our non-PEO NEOs, and the Company’s cumulative TSR over the three most recently completed fiscal years. Description of Relationship Between PEO and non-PEO NEO Compensation Actually Paid and Net Income The following chart sets forth the relationship between Compensation Actually Paid to our PEO, the average of Compensation Actually Paid to our non-PEO NEOs, and our Net Income and Loss during the three most recently completed fiscal years. Description of Relationship Between PEO and Non-PEO NEO Compensation Actually Paid and Product Revenue, Net The following chart sets forth the relationship between Compensation Actually Paid to our PEO, the average of Compensation Actually Paid to our non-PEO NEOs, and Product Revenue, net during the three most recently completed fiscal years. Description of Relationship Between Company TSR and Peer Group TSR The following chart compares our cumulative TSR to that of the NASDAQ Biotechnology Index. Tabular List of Most Important Financial Performance Measures The following table presents the financial performance measure that the Company considers to have been the most important in linking Compensation Actually Paid to our PEO and Non-PEO NEOs for 2023 to Company performance: • Product Revenue, Net
CEO Pay Ratio
CEO Pay Ratio Under rules adopted pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, we are required to calculate and disclose the total compensation paid to our median paid employee, as well as the ratio of the total compensation paid to the median paid employee as compared to the total compensation paid to our Chief Executive Officer (the “CEO Pay Ratio”). The paragraphs that follow describe our methodology and the resulting CEO Pay Ratio. We identified the median paid employee using our employee population on December 31, 2023, including all employees (except our Co-CEOs). We identified the median employee using the employee's annualized total compensation in accordance with the requirements of the Summary Compensation Table as of December 31, 2023 for all active employees as of that date. Our median paid employee compensation as calculated using Summary Compensation Table requirements was $328,691. The compensation for each of our Co-CEOs as reported in the Summary Compensation Table was $7,410,869. Therefore, our CEO Pay Ratio is approximately 23:1. This information is being provided for compliance purposes and is a reasonable estimate calculated in a manner consistent with SEC rules, based on our internal records and the methodology described above. The SEC rules for identifying the median compensated employee allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may use different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios. Neither the compensation committee nor management of the Company used the CEO Pay Ratio measure in making compensation decisions.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION
Non-Employee Director Compensation Table
Non-Employee Director Compensation Table The following table presents the total compensation for each person who served as a non-employee member of our board of directors during the fiscal year ended December 31, 2023. Other than as set forth in the table and described more fully below, we did not pay any compensation, make any equity awards or non-equity awards to, or pay any other compensation to any of the non-employee members of our board of directors in 2023 for their services as members of the board of directors. Joshua Cohen and Justin Klee, our Co-Chief Executive Officers, received no additional compensation for their service as directors. See the section titled “Executive Compensation—2023 Summary Compensation Table” for more information on the compensation paid to or earned by Messrs. Cohen and Klee as employees for the year ended December 31, 2023.
Non-Employee Director Compensation Table
| Name | Fees Earned or Paid in Cash ($) | Option Awards ($)(1)(2)(3) | Total ($) | | George Mclean Milne Jr., Ph.D. | 110,000 | 275,066 | 385,066 | | Daphne Quimi | 73,528 | 275,066 | 348,594 | | Paul Fonteyne | 67,056 | 275,066 | 342,122 | | Karen Firestone | 47,667 | 633,484 | 681,151 |
Non-Employee Director Compensation Table
(1) The amounts reported represent the aggregate grant date fair value of the stock options awarded to the non-employee directors during fiscal year 2023, calculated in accordance with FASB ASC Topic 718. Such grant date fair value does not take into account any estimated forfeitures. The assumptions used in calculating the grant date fair value of the awards reported in this column are set forth in Note 13 to our consolidated financial statements included in our 2023 Annual Report. The amounts reported in this column reflect the accounting cost for the stock options and do not correspond to the actual economic value that may be received upon vesting or exercise of the stock options or any sale of any of the underlying shares of common stock. (2) As of December 31, 2023, the non-employee members of our board of directors held the following aggregate number of exercisable and unexercisable options:
Non-Employee Director Compensation Table
| | Number of Stock Options Held at Fiscal Year-End | | | Name | Exercisable (#) | Unexercisable (#) | | George Mclean Milne Jr., Ph.D. | 29,400 | 16,985 | | Daphne Quimi | 78,098 | 47,387 | | Paul Fonteyne | 83,165 | 42,320 | | Karen Firestone | — | 31,311 |
Non-Employee Director Compensation Table
No non-employee member of our board of directors held unvested RSUs as of December 31, 2023.
Non-Employee Director Compensation Policy
Non-Employee Director Compensation Policy In connection with our IPO, our board of directors adopted a non-employee director compensation policy. Our non-employee director compensation policy, as amended most recently in January 2023 and April 2024 (the “non-employee director compensation policy”), is designed to enable us to attract and retain, on a long-term basis, highly qualified non-employee directors. Under the policy, each director who is not an employee was paid cash compensation as set forth below for the 2023 fiscal year, with the exception of the cash compensation payable for service on the S&T Committee, which was formed in April 2024:
Non-Employee Director Compensation Policy
| Position | Annual Retainer | | Members (other than chair) | $45,000 | | Retainer for chair | $82,500 | | Audit Committee: | | | Members (other than chair) | $10,000 | | Retainer for chair | $20,000 | | Compensation Committee: | | | Members (other than chair) | $7,500 | | Retainer for chair | $15,000 | | Nominating and Corporate Governance Committee: | | | Members (other than chair) | $5,000 | | Retainer for chair | $10,000 | | Science and Technology Committee: | | | Members (other than chair) | $7,500 | | Retainer for chair | $15,000 |
Non-Employee Director Compensation Policy
In addition, the non-employee director compensation policy provides that, upon initial election to our board of directors, each non-employee director will be granted an equity award of stock options to purchase the lesser of (x) a stock option with a grant date fair value of $570,000 or (y) a stock option to purchase 50,000 shares (the “Initial Grant”). The Initial Grant will vest in one-third on the first anniversary of the date of grant, and the remaining two-thirds will vest in equal monthly installments over two years, provided, however, that all vesting shall cease if the director resigns from the board of directors or otherwise ceases to service as our director. Furthermore, on the date of each of our annual meeting of stockholders, each non-employee director who continues as a non-employee director following such meeting will be granted an annual equity award of stock options to purchase the lesser of (x) a stock option with a grant date fair value of $285,000 or (y) a stock option to purchase 25,000 shares (the “Annual Grant”). The Annual Grant will vest in full upon the earlier of (i) the first anniversary of the date of grant or (ii) the date of the next annual meeting; provided, however, that all vesting shall cease if the director resigns from the board of directors or otherwise ceases to serve as a director, unless the board of directors determines that the circumstances warrant continuation of vesting. In addition, all vested options remain exercisable for twelve (12) months if the director resigns from the board of directors or otherwise ceases to serve as a director. Notwithstanding the foregoing, if an outside director was initially elected to the board of directors within twelve (12) months preceding the annual meeting, then such outside director shall receive an Annual Grant that is pro-rated on a monthly basis for time serving as an outside director. Upon a “sale event” (as defined in our 2022 Plan), all outstanding Initial Awards and Annual Awards held by outside directors fully accelerate and become fully vested and exercisable.