UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): March 27, 2017
ALEXION PHARMACEUTICALS, INC.
-----------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware | 0-27756 | 13-3648318 |
------------------ | ------------------ | --------------- |
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) |
100 College Street, New Haven, Connecticut 06510
---------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number, including area code: (475) 230-2596
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On March 27, 2017, Alexion Pharmaceuticals, Inc. (Alexion) announced that its Board of Directors (the Board) has appointed Ludwig N. Hantson, Ph.D. as Chief Executive Officer and member of the Board, effective immediately. Dr. Hantson succeeds David R. Brennan, who has served as Alexion’s Interim Chief Executive Officer since December 2016. Mr. Brennan will remain on the Board of Directors.
Dr. Hantson, age 54, most recently served as President and CEO of Baxalta Incorporated (Baxalta), a public company spin-off from Baxter International Inc. (Baxter), from July 2015 until its sale to Shire plc in June 2016. Prior to joining Baxalta, Dr. Hantson served as Baxter’s Corporate Vice President and President, BioScience from October 2010 to July 2015. Prior to his roles at Baxter, Dr. Hantson held several leadership roles at Novartis AG from 2001-2010, including CEO of Novartis Pharma North America, CEO of Novartis Europe, and President of Novartis Pharma Canada. From 1988-2001, Dr. Hantson served in increasing roles of responsibility in marketing, and research and development at Johnson & Johnson. Dr. Hantson began his career at Smith & Nephew, and received his Ph.D. in motor rehabilitation and physical therapy, Master’s degree in physical education, and a certification in high secondary education, all from the University of Louvain in Belgium.
There is no arrangement or understanding between Dr. Hantson and any other person pursuant to which Dr. Hantson was appointed as Alexion’s Chief Executive Officer or as a director. There are no related party transactions between Alexion and Dr. Hantson and no family relationships between Dr. Hantson and any of the directors or officers of Alexion.
In connection with Dr. Hantson’s appointment, Alexion entered into an employment agreement with Dr. Hantson (the Employment Agreement) that has a three-year term subject to automatic one-year extensions, unless Alexion or Dr. Hantson provides notice prior to the end of the term, as extended. Pursuant to the Employment Agreement, Dr. Hantson will receive a base salary of at least $1,200,000 per year and will be eligible to receive an annual performance bonus targeted at 120% of his base salary, with the amount of the bonus to be determined by the Board or the Leadership and Compensation Committee pursuant to Alexion’s management incentive bonus program as in effect from time to time.
Dr. Hantson will receive equity awards under Alexion's 2004 Incentive Plan of stock options valued at approximately $2.275 million, restricted stock units valued at approximately $3.413 million and performance share units valued at target at approximately $5.689 million. The grant date of such awards is March 27, 2017. The stock options vest 25% on the first anniversary of the grant date and one sixteenth every three months thereafter, subject to continuous service. The restricted stock units vest 25% on each of December 31, 2017, December 31, 2018, March 27, 2020 and March 27, 2021. Approximately 80% of Performance Share Units may be earned following a one year performance
period, and if earned, one-third will vest upon certification of performance and one third on each of the next two anniversaries. Approximately 20% of the Performance Share Units may be earned, and will vest if earned, following completion of a three year performance period. In addition, Dr. Hantson will be eligible to receive stock-based awards under Alexion’s equity incentive plan or program maintained by Alexion as in effect from time to time in the discretion of the Board or the Leadership and Compensation Committee. Dr. Hantson is also subject to certain customary non-solicitation and non-competition provisions.
Under the terms of the Employment Agreement, in the event that Dr. Hantson’s employment with Alexion terminates, other than within 18 months after a change in control of Alexion, (i) for reasons other than cause, death, or physical or mental disability, or (ii) following a constructive termination, or (iii) in the event of a “non-renewal”, Alexion will be obligated to pay Dr. Hantson cash equal to two times the sum of (a) his then current base salary and (b) the greater of (1) the average bonus received by him for the two years preceding the year in which termination occurs and (2) the amount equal to Dr. Hantson’s target bonus for the year in which the termination of employment occurs (the sum of (a) and (b), the Severance Base). In addition, (1) all of Dr. Hantson’s initial time-vesting equity awards and other equity awards that have been granted to and earned by Dr. Hantson shall vest, and all other time-vesting awards that are at least then 50% vested shall vest, and become immediately exercisable and shall remain exercisable for such periods as provided under the terms of Alexion's Amended and Restated 2004 Incentive Plan and any individual award agreement under which such awards were granted and (2) all other equity awards will vest as determined in good faith by Alexion's Board of Directors based on the achievement of performance conditions.
In the event Dr. Hantson is terminated for any of the reasons described in (i) – (iii) above within 18 months following a change in control of Alexion, Alexion will be obligated to pay Dr. Hantson cash equal to three times the Severance Base. Alexion will also be obligated to pay Dr. Hantson a pro-rata annual bonus for the year in which termination of employment occurs, calculated by multiplying his target annual bonus by a fraction, the numerator of which is the number of days Dr. Hantson was employed during such year and the denominator of which is 365. In addition, (1) all of Dr. Hantson’s initial time-vesting equity awards and other equity awards that have been granted to and earned by Dr. Hantson shall vest, and all other time-vesting awards that are at least then 50% vested shall vest, and become immediately exercisable and shall remain exercisable for such periods as provided under the terms of Alexion's Amended and Restated 2004 Incentive Plan and any individual award agreement under which such awards were granted and (2) all other equity awards will vest as determined in good faith by Alexion's Board of Directors based on the achievement of performance conditions.
In addition, upon his termination for any reason described above, Dr. Hantson will also be entitled to a lump sum amount equal to the present value of the monthly health premiums that otherwise would have been paid by Alexion on behalf of Dr. Hantson and his eligible dependents for a period of 18 months following the termination.
The foregoing summary of certain terms of the Employment Agreement is qualified in its entirety by the terms of the Employment Agreement, which will be filed as an exhibit to Alexion’s Quarterly Report on Form 10-Q for the fiscal quarter ending March 31, 2017.
A copy of the press release announcing Dr. Hantson’s appointment is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
99.1 | Press Release issued by Alexion Pharmaceuticals, Inc. on March 27, 2017 relating to the appointment of Dr. Hantson. |
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: March 27, 2017 | ALEXION PHARMACEUTICALS, INC. |
By: /s/ Michael V. Greco | |
Name: Michael V. Greco | |
Title: Senior Vice President of Law and Corporate Secretary | |
Alexion Appoints Ludwig Hantson, Ph.D., as Chief Executive Officer
Biopharmaceutical Veteran Brings Extensive Experience Leading Global Organizations, Building Innovative and Diverse Pipelines, and Delivering New Products to Market
NEW HAVEN, Conn.- - (March 27, 2017) - -Alexion Pharmaceuticals, Inc. (NASDAQ: ALXN) today announced that its Board of Directors has appointed Ludwig N. Hantson, Ph.D., as Chief Executive Officer and member of the Board of Directors, effective immediately. Dr. Hantson most recently served as President and CEO of Baxalta, a successful spin-off as a public company from Baxter, and a global leader in the development of therapies for orphan and underserved diseases in hematology, immunology and oncology. Dr. Hantson brings to Alexion a strong record of developing diverse rare disease pipelines and commercializing innovative and life-transformative therapies at industry-leading companies.
He succeeds David R. Brennan, who has led the company as Interim CEO since December 2016. Mr. Brennan will remain on the Board of Directors and, as the company previously announced, the Board expects to appoint Mr. Brennan as Chairman at the Annual Meeting of Shareholders scheduled for May 10.
As CEO of Baxalta, Dr. Hantson led the creation of a successful biopharmaceutical company that delivered shareholder value through significant revenue growth, an innovative research and development center with a pipeline of 20 new product candidates, and several new product launches globally. Prior to Baxalta, Dr. Hantson was President of Baxter BioScience, a $6 billion global business unit of Baxter where he drove significant value into its pipeline by adding 25 New Molecular Entities and Biologics License Applications, and launching 13 new products.
“I am honored and proud to join Alexion, an innovator and pioneer in rare diseases and a company that shares my commitment to serving patients and families,” said Dr. Hantson. “I believe Alexion is in a strong position to continue to advance the science and build upon its global capabilities to serve even more patients with devastating and rare diseases in over 50 markets. Alexion is on-track to achieving its near-term priorities, including: growing its complement and metabolic franchises; obtaining approval of Soliris in refractory gMG; and advancing its pipeline programs including ALXN1210 and eculizumab in relapsing NMOSD. I also look forward to building our future R&D and commercial growth strategies which will be guided by the Company’s long-standing goal of transforming lives.”
R. Douglas Norby, Alexion’s Lead Independent Director, said, “After a comprehensive search process, the Board is very pleased to appoint Ludwig, a seasoned executive and inspirational leader who will help us advance our pipeline and commercial growth initiatives while maintaining Alexion’s mission to serve patients with life-transforming therapies.” Mr. Norby added, “Ludwig is a results-oriented leader with a strong R&D and commercial track record based on his ability to implement sound business strategies grounded in scientific, commercial and financial analyses. He understands the complexities of leading a large biotechnology company, and his commitment to ethics, excellence and execution will drive the next phase of growth and innovation for Alexion, and create value for all stakeholders.”
Mr. Norby continued, “In addition, on behalf of the entire Board of Directors, we would like to thank David Brennan for his dedicated leadership as Interim CEO. His deep knowledge of Alexion’s business and culture was instrumental in guiding our company during this period of transition, as well as helping to identify a leader who shares our dedication and commitment to serving patients and families with devastating and rare diseases.”
Prior to his roles at Baxalta and Baxter BioScience, Dr. Hantson held several leadership roles during his decade-long tenure at Novartis from 2001-2010, including CEO of Novartis Pharma North America, CEO of Novartis Europe, and President of Novartis Pharma Canada. He began his career at Smith & Nephew and subsequently served in increasing roles of responsibility in marketing, and research and development at Johnson & Johnson from 1988-2001. Dr. Hantson received his Ph.D. in motor rehabilitation and physical therapy, Master’s degree in physical education, and a certification in high secondary education, all from the University of Louvain in Belgium.
About Alexion
Alexion is a global biopharmaceutical company focused on developing and delivering life-transforming therapies for patients with devastating and rare disorders. Alexion is the global leader in complement inhibition and has developed and commercializes the first and only approved complement inhibitor to treat patients with paroxysmal nocturnal hemoglobinuria (PNH) and atypical hemolytic uremic syndrome (aHUS), two life-threatening ultra-rare disorders. In addition, Alexion’s metabolic franchise includes two highly innovative enzyme replacement therapies for patients with life-threatening and ultra-rare disorders, hypophosphatasia (HPP) and lysosomal acid lipase deficiency (LALD). Alexion is advancing its rare disease pipeline with highly innovative product candidates in multiple therapeutic areas. This press release and further information about Alexion can be found at: www.alexion.com.
[ALXN-G]
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements often include words such as "anticipate," "believe," "expect," "will," or similar expressions. Forward-looking statements are subject to factors that may cause Alexion's results and plans to differ from those expected, including for example, risks related to potential disruptions to our business as a result of leadership changes, and a variety of other risks set forth from time to time in Alexion's filings with the U.S. Securities and Exchange Commission, including but not limited to the risks discussed in Alexion's Annual Report on Form 10-K for the period ended December 31, 2016 and in our other filings with the U.S. Securities and Exchange Commission. Alexion does not intend to update any of these forward-looking statements to reflect events or circumstances after the date hereof, except when a duty arises under law.
Contact:
Alexion
Media
Stephanie Fagan, 475-230-3777
Senior Vice President, Corporate Communications
or
Kim Diamond, 475-230-3775
Executive Director, Corporate Communications
or
Investors
Elena Ridloff, CFA, 475-230-3601
Vice President, Investor Relations