David J. Gaffin
AlkermesAbout David J. Gaffin
David J. Gaffin is Executive Vice President, Chief Legal Officer, Chief Compliance Officer and Secretary of Alkermes plc (appointed July 2022). He joined Alkermes in 2005 and previously served in a progression of senior legal roles; prior to Alkermes he was Assistant General Counsel at Biogen, providing counsel on product and collaboration/licensing matters . He is 53 years old as of April 1, 2025 . Company performance context during his current tenure includes 2024 total revenues “over $1.5 billion,” EBITDA from continuing operations of $452 million, and strategic actions such as $200 million of share repurchases and full debt retirement; 2024 proprietary product net sales exceeded $1 billion (18% YoY), with Vivitrol +14%, Lybalvi +46%, and Aristada +6% YoY . Over 2019–2024, ALKS’ cumulative TSR index increased to 141 vs. 118 for the Nasdaq Biotechnology Index (both 100 at 2019 base) . Pay-versus-performance disclosure indicates EBITDA from continuing operations as the most important financial measure linking compensation actually paid to NEOs in 2024, with additional emphasis on proprietary product profitability and a relative TSR modifier in long-term incentives .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Alkermes plc/Alkermes, Inc. | EVP, Chief Legal Officer & Chief Compliance Officer; Secretary | Jul 2022–present | Executive leadership of legal, IP, and compliance; governance and comp matters; managed share repurchase program, early debt retirement, and Athlone manufacturing business sale . |
| Alkermes, Inc. | SVP, Chief Legal Officer & Chief Compliance Officer; Secretary | Mar 2018–Jul 2022 | Strategic legal/compliance support across organization . |
| Alkermes, Inc. | SVP & Chief Legal Officer; Secretary | Dec 2017–Mar 2018 | Senior legal leadership and corporate secretary responsibilities . |
| Alkermes, Inc. | SVP & Chief Legal Officer | May 2016–Dec 2017 | Led legal organization . |
| Alkermes, Inc. | VP, U.S. General Counsel | Jan 2014–May 2016 | U.S. legal leadership . |
| Alkermes, Inc. | VP, Deputy General Counsel | Oct 2011–Jan 2014 | Increasing responsibility in legal function . |
| Alkermes, Inc. | Legal roles of increasing responsibility | 2005–2011 | Product, governance, and transactional support . |
| Biogen | Assistant General Counsel | Pre-2005 | Product-related legal counsel; collaboration and licensing transactions . |
Fixed Compensation
Multi-year summary compensation (SCT) for David J. Gaffin:
| Metric (USD) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary | 614,201 | 639,000 | 664,560 |
| Stock Awards (ASC 718 grant-date fair value) | 1,533,595 | 1,316,222 | 1,395,582 |
| Option Awards (ASC 718 grant-date fair value) | 1,682,506 | 1,665,586 | 1,639,227 |
| Non-Equity Incentive Plan Compensation (STIP) | 446,400 | 498,420 | 398,736 |
| All Other Compensation | 15,250 | 16,500 | 17,250 |
| Total | 4,291,952 | 4,135,728 | 4,115,355 |
Base salary and target bonus:
| Item | 2023 | 2024 |
|---|---|---|
| Base Salary (approved) | $639,000 | $664,560 (+4.0%) |
| Target Performance Pay (% of Base) | 60% | 60% |
2024 STIP payout specifics:
| Payout Metric | Value |
|---|---|
| 2024 Cash Performance Payout Amount | $398,736 |
| 2024 Actual as % of Base Salary | 60% |
| 2024 Actual as % of Target | 100% |
Notes:
- 2024 base salary increases were set against peer market data and responsibilities; Gaffin received +4.0% .
- STIP targets/pay ranges maintained from 2023 to 2024 .
Performance Compensation
STIP design and metrics:
- 2024 STIP incorporated objective, measurable financial/operational/pipeline/CSR goals; included an EBITDA objective aligned to guidance issued in February 2024 .
- Company performance payout percentage for 2024 was 100%; Gaffin’s individual payout equaled 100% of target (60% of base) .
LTI design and performance:
- 2024 LTIP PRSUs: three-year performance goals split 50% financial and 50% pipeline, with a relative TSR modifier of +/-25% applied to outcomes .
- Pay-versus-performance identifies EBITDA from continuing operations as the top financial link to compensation; other key measures: proprietary product profitability, EBITDA margin, NGNI margin, and relative TSR .
2022 LTIP results (payout certified Feb 2025):
| Category | Weight | Target | Actual Achievement | Payout for Category |
|---|---|---|---|---|
| Financial (NGNI margin and EBITDA margin for FY 2024) | 40% | EBITDA margin = 30% of total revenue | FY 2024 EBITDA margin 29% and NGNI margin 32% | 80.8% of metric weight (32.32% of total target) |
| Commercial | 30% | Pre-set commercial goals | Below threshold | 0% |
| Pipeline | 30% | Pre-set pipeline goals | Stretch performance | 150% of metric weight (45% of total target) |
| Relative TSR Modifier | +/-25% | IBB comparator | ~80th percentile | +25% applied |
| Overall Payout | — | 100% | — | 96.65% of target |
2022 PRSU shares earned (awarded/earned):
| Executive | 2022 PRSU Target Shares | Total Earned Shares |
|---|---|---|
| David J. Gaffin | 33,474 | 32,350 |
2024 equity grants to Gaffin:
| Award Type | Grant Date | Shares/Target | Exercise Price | Grant-Date Fair Value |
|---|---|---|---|---|
| Time-Vesting RSUs | 2/26/2024 | 27,464 | — | $825,019 |
| PRSUs (target/max) | 2/26/2024 | 27,464 / 51,495 | — | $479,659 (plan-based awards table) |
| Stock Options | 2/26/2024 | 111,186 | $30.04 | $1,639,227 |
| Incremental FV for 2021 PRSUs (ASC 718 modification) | 2/8/2024 | — | — | $90,904 |
| 2024 PRSUs ASC 718 FV (Monte Carlo, assuming highest performance) | 2024 | — | — | $1,798,720 |
Additional STIP/LTI governance:
- Anti-hedging and anti-pledging policy for executives and directors; 10b5-1 trading policy maintained .
- Clawback and recoupment policies apply to certain equity and cash compensation (expanded 2021; Nasdaq Rule 5608-aligned policy effective Oct 2023) .
Equity Ownership & Alignment
Beneficial ownership (record date for proxy; 60-day look-forward for issuable):
| Category | Shares |
|---|---|
| Issued Ordinary Shares | 204,255 |
| Ordinary Shares Issuable within 60 days (options/RSUs) | 663,541 |
| Total Beneficial Ownership | 867,796 |
| Percent of Outstanding | <1% (asterisked as less than 1%) |
Ownership policy and pledging:
- Share ownership and holding guidelines apply to officers; officers must retain 50% of shares acquired from RSU vesting/option exercise until guidelines met. As of Jan 2, 2025, all officers, including Gaffin, were in compliance .
- Hedging and pledging of company stock are prohibited for officers and directors .
Outstanding equity and vesting profile (as of 12/31/2024):
- Unvested RSUs (selected cohorts): 7,432; 12,709; 4,029; 23,068; 27,464 shares; unearned PRSUs outstanding: 32,350; 23,067; 20,598 shares; year-end valuation based on $28.76 close .
- Options by tranche (selected; E=Exercisable, U=Unexercisable):
- 18,104 (E) @ $69.83 exp 2/26/2025 .
- 36,719 (E) @ $31.64 exp 2/28/2026 .
- 40,799 (E) @ $53.50 exp 2/17/2027 .
- 55,589 (E) @ $65.94 exp 2/16/2028 .
- 108,833 (E) @ $31.93 exp 2/21/2029 .
- 120,040 (E) @ $20.03 exp 2/20/2030 .
- 90,977 (E) / 30,326 (U) @ $19.34 exp 2/22/2031 .
- 50,837 (E) / 50,837 (U) @ $24.59 exp 2/18/2032 .
- 14,694 (E) / 14,694 (U) @ $24.82 exp 8/3/2032 .
- 30,756 (E) / 92,271 (U) @ $26.82 exp 2/23/2033 .
- 111,186 (U) @ $30.04 exp 2/26/2034 .
- At the 12/31/2024 close of $28.76, options with strikes below $28.76 were in-the-money, while those with higher strikes were out-of-the-money; the proxy uses $28.76 for valuation of potential acceleration .
Vesting and exercises in 2024:
| 2024 Activity | Shares | Value |
|---|---|---|
| Options Exercised | — | — |
| Stock Awards (RSUs/PRSUs) Vested | 58,906 | $1,676,620 |
Equity grant timing:
- Annual grants typically occur on a pre-determined date in February, after year-end results and trading window reopenings; no grants were made around filings of material nonpublic information in 2024 .
Employment Terms
Severance and change-in-control (CIC) economics:
- Termination without cause / good reason: 12 months’ pay equal to current base plus the average of the prior two years’ annual cash incentive, plus continued health benefits for 12 months (applies to Gaffin; CEO has 24 months) .
- CIC double trigger (within two years post-CIC): pro-rata base and cash incentive for year of termination plus lump sum 1.5x (base salary + two-year average cash incentive) and 18 months of benefits (Gaffin); no excise tax gross-up for Gaffin (gross-ups discontinued for hires after 2009 and not provided to Gaffin) .
- Equity acceleration moved to double-trigger for awards granted from and after Feb 2023; pre-Feb 2023 awards were single-trigger under the plan terms .
Estimated potential payments (assuming 12/31/2024 event, share price $28.76):
| Scenario | Cash Severance | Equity Acceleration | Benefits | Total |
|---|---|---|---|---|
| Involuntary Termination (No CIC) | $1,136,970 | — | $28,096 | $1,165,066 |
| Involuntary Termination (Following CIC) | $2,177,865 | $5,520,110 | $42,145 | $7,740,120 |
Clawback / recoupment:
- Equity and certain cash compensation subject to clawback and recoupment policies, including the company’s Rule 10D-1/Nasdaq-compliant Recoupment Policy effective October 2023 .
Deferred compensation, pensions, perquisites:
- No qualified or non-qualified defined benefit plans; no company non-qualified defined contribution plans; proxy highlights “no excessive perquisites” .
Investment Implications
- Pay-for-performance alignment: Gaffin’s variable pay is driven by company EBITDA/profitability and pipeline outcomes (STIP and PRSUs), with relative TSR serving as an additional modifier—constructive for aligning with shareholder value creation .
- Vesting/selling pressure: 2024 saw no option exercises and ~58.9k shares vested; many legacy options are out-of-the-money at the 12/31/2024 close, while substantial tranches with strikes below $28.76 (e.g., $19.34–$26.82) are in-the-money, indicating measured but manageable potential selling pressure as RSUs/PRSUs vest and as ITM options approach mid- to late-2020s expirations .
- Retention and CIC terms: One-year severance and 1.5x CIC multiple for Gaffin, with double-trigger equity vesting on post-CIC termination, provide retention while avoiding single-trigger windfalls; absence of excise tax gross-ups for Gaffin is shareholder-friendly .
- Ownership alignment and risk controls: Beneficial ownership of ~868k shares (issued plus issuable), compliance with ownership guidelines, and prohibitions on hedging/pledging support alignment and reduce financing/leverage risk signals from insider transactions; strong clawback framework further mitigates governance risk .
- Execution track record: 2024 corporate achievements (>$1.5B revenue, $452M EBITDA from continuing ops, $200M buybacks, debt retirement) and 2022 PRSU payout at ~96.65% (post +25% TSR modifier at ~80th percentile vs IBB) together indicate solid execution against financial and pipeline goals during his current tenure in role, supporting compensation outcomes .