In a preliminary proxy statement filed Friday with the U.S. Securities and Exchange Commission, Drug maker Eli Lilly & Co. (LLY) said that it will freeze salaries for employees in most countries worldwide, including the named executive officers, this year.
On January 31, Eli Lilly reported a 27 percent decline in fourth-quarter profit, as the company lost patent exclusivity for its top-selling schizophrenia drug Zyprexa and chemotherapy medicine Gemzar.
In light of the business challenges the company faces, John Lechleiter, Lilly's chief executive officer, requested that he receive no increase in base salary or incentive targets in 2012. Lechleiter's base salary will be $1.5 million and his total compensation will be about $16.4 million, according to the filing. The board committee agreed to maintain his 2011 compensation package for 2012.
For 2011, Lechleiter's total compensation was valued at $16.4 million, down slightly from $16.5 million for 2010. In addition to his $1.5 million base salary, the total included stock awards valued at $5.6 million; nonequity incentive plan compensation of $2.6 million; change in pension value of $6.5 million; and other compensation valued at $90,000.
Looking Ahead to 2012 Compensation , the amendments to the change-in-control severance pay plans to eliminate tax gross-ups are effective October 2012.
Lilly closed Friday's trading on the NYSE at $39.51, down $0.09 or 0.23%.
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