Muthusamy Shanmugam
Head of Research & Development and Chief Operating Officer of NJ Operations at 
ANI PHARMACEUTICALS
ANI PHARMACEUTICALSExecutive
Board
About Muthusamy Shanmugam
Muthusamy Shanmugam, 57, is Head of Research & Development and Chief Operating Officer, Novitium Operations, and has served on ANIP’s Board since November 2021. He holds an M.S. in Industrial Pharmacy from the Tamil Nadu Dr. M.G.R. Medical University and is a registered pharmacist in New York . Company performance under the current leadership framework delivered 2024 revenue of $614.4 million (+26% YoY) and adjusted non-GAAP EBITDA of $156.0 million (+17% YoY), with Cortrophin Gel net sales of $198.1 million (+77% YoY) and multi-year ACTH market expansion . ANIP’s cumulative TSR proxy measure shows $100 invested on 12/31/2019 valued at $89.64 at 12/31/2024 versus peer group $89.73 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Novitium | President | 2016–present (as disclosed) | Co-founded and led generics development; integrated into ANIP operations |
| Par Pharmaceutical | Various roles | Not disclosed | Leadership experience across major generic pharma operator |
| Novel Laboratories | Various roles | Not disclosed | Development and operations roles in generics |
| Kali Laboratories | Formulation Scientist | Not disclosed | Early R&D foundation |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| SS Pharma LLC | Director and Founder | Not disclosed | U.S. agent for API sales; received $1,244,478 from ANIP in 2024 (related party) |
| Sthree Chemicals Pvt Ltd | Director and Founder | Not disclosed | API supply; received $11,427,962 from ANIP in 2024 (related party) |
| Nuray Chemicals Private Limited | Director and Founder | Not disclosed | API manufacturing; no ANIP payments disclosed for 2024 |
| Scitus Pharma Services Pvt Ltd | Director and Founder | Not disclosed | CRO services to Novitium; received $2,758,631 from ANIP in 2024 (related party) |
| Esjay Pharma LLC | Director and Founder | Not disclosed | R&D/facilities consulting; received $114,751 in 2024; also holds ANIP shares via Esjay |
Fixed Compensation
Not disclosed in the 2025 proxy as Shanmugam is not a named executive officer; he also does not receive additional compensation for board service as an employee-director .
Performance Compensation
Company program structure (indicative for executives):
- Annual cash incentives based on corporate and functional goals; 2024 corporate objectives included Net Revenues ($501–$530m, 25% weight), Adjusted EBITDA ($119–$134m, 25%), plus Generics/Brands, Rare Disease, efficiency/compliance, and Corporate Development goals; corporate achievement certified at 200% of target given revenues $614.4m and adjusted EBITDA $156.0m .
- Long-term incentives include PSUs (50% 3-year Adjusted EBITDA YoY growth, 50% 3-year relative TSR vs S&P 600 Pharma/Biotech/Life Sciences) and time-based restricted stock; PSU payouts range 50–200% and cliff-vest after 3 years .
| Metric | Weighting | Target/Framework | Actual/Payout | Vesting Terms |
|---|---|---|---|---|
| Net Revenues | 25% | $501–$530m (2024 corporate objective) | $614.4m; payout factor 200% | Cash annual bonus per plan rules |
| Adjusted non-GAAP EBITDA | 25% | $119–$134m (2024 corporate objective) | $156.0m; payout factor 200% | Cash annual bonus per plan rules |
| Generics/Brands strategic goals | 15% | Pipeline, CGT filings, gov’t channel growth | Overachievement (17 launches, pipeline build) | n/a |
| Rare Disease goals | 15% | Team/indication expansion; compliance; studies | Overachievement (Cortrophin execution; speaker program) | n/a |
| Efficiency/Controls/Compliance | 10% | $5m procurement savings; cyber & systems; culture | Procurement savings and org strengthening | n/a |
| Corp Dev & Strategy | 10% | Complete Rare Disease M&A & integration | Alimera acquisition closed Sept 2024 | n/a |
| PSUs – Adjusted EBITDA Growth | 50% of PSU | 3-year growth vs plan | Not yet certified | Cliff vest post 3-year period |
| PSUs – Relative TSR | 50% of PSU | vs S&P 600 Pharma/Biotech/Life Sciences; capped at target if negative TSR | Not yet certified | Cliff vest post 3-year period |
Note: Individual payout details for Shanmugam are not disclosed.
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership | 715,159 ANIP common shares (3.3% of outstanding as of March 14, 2025) |
| Ownership components | 29,377 directly held; 33,113 unvested restricted stock; 15,049 unvested PSUs; 5,000 via SS Pharma LLC; 632,620 via Esjay LLC (Shanmugam sole managing member of SS Pharma and Esjay) |
| Shares outstanding basis | 21,600,973 common shares; 10,864 Class C Special Stock at March 14, 2025 |
| Pledging/Hedging | Anti-pledging policy prohibits margining/pledging by directors and officers; insider trading policy prohibits derivatives and short sales; no waivers disclosed |
| Ownership guidelines | Executives must hold stock equal to 1x salary (CEO 4x); all executive officers have achieved guidelines; directors 4x annual cash retainer, achieved by all board members |
Employment Terms
- ANIP entered into employment agreements with Novitium founders, including Shanmugam, upon acquisition; specific severance and change-of-control terms for Shanmugam are not disclosed in the proxy .
- Non-compete, non-solicit, garden leave, and consulting arrangements are not disclosed.
Board Governance
- Board service: Director since November 2021; employee-director (not independent per Nasdaq/SEC standards) .
- Committee roles: Not a member of Audit & Finance, Compensation, or Nominating & Corporate Governance committees; employee-director designation noted .
- Attendance: Board held 15 meetings in 2024; no current director attended fewer than 75% of meetings/committees; annual meeting attendance maintained .
- Leadership: Separate CEO and Chair; no Lead Independent Director currently .
Director Compensation
- Shanmugam receives no additional compensation for Board service as an employee-director .
- For context, non-employee directors: $59,250 annual cash retainer; Chair +$42,500; committee chair/member retainers; annual restricted stock ~$290,000 grant value with 1-year vest .
Related Party Transactions (Potential Conflicts)
| Entity | Nature | 2024 Payments by ANIP |
|---|---|---|
| Scitus Pharma Services (CRO) | Clinical research services to Novitium | $2,758,631 |
| SS Pharma LLC (API agent) | API supply | $1,244,478 |
| Esjay Pharma LLC | R&D/facilities consulting (through Sept 30, 2022) | $114,751 |
| Sthree Chemicals Pvt Ltd (API supply) | API supply | $11,427,962 |
| Nuray Chemicals Private Ltd (API manufacturing) | API manufacturing supply | $0 |
| Novitium Earn-outs (2013–2024) | ANDA Filing Earn-Out payouts | $6,684,930 in 2023; ~$6,667,746 in 2024 to Shanmugam/Esjay; and $1,903,183 in 2023; ~$1,898,290 in 2024 to Gassert/Chali Properties |
Governance note: These are transactions with entities in which Shanmugam holds interests; Board evaluates independence and related-party transactions under Item 404; six of eight directors are independent; compensation and audit committees are independent .
Compensation Committee Analysis
- Composition: Compensation Committee comprised of independent directors Antonio Pera (Chair), Renee Tannenbaum, Jeanne Thoma .
- Consultant: Pearl Meyer engaged; independence assessed; no conflicts .
- Program: Emphasizes pay-for-performance; clawback policy adopted under Dodd-Frank; double-trigger CIC provisions standard; no repricing; no dividends on unvested equity; robust stock ownership guidelines .
Say-on-Pay & Shareholder Feedback
- 2024 say-on-pay approval: 95.5% of votes cast approved executive compensation program .
- Peer group: 16-company pharma/biotech peer group used for benchmarking in 2024 .
Performance & Track Record (Company context)
| Year | Revenue ($mm) | Net Income (Loss) ($mm) | ANIP $100 Invested (12/31/2019 basis) | Peer Group $100 Invested |
|---|---|---|---|---|
| 2020 | 208.5 | (22.5) | $47.09 | $144.89 |
| 2021 | 216.1 | (42.6) | $74.72 | $139.98 |
| 2022 | 316.4 | (47.9) | $65.23 | $94.77 |
| 2023 | 486.8 | 18.8 | $89.41 | $91.86 |
| 2024 | 614.4 | (18.5) | $89.64 | $89.73 |
Employment Terms (Change-in-Control Economics – Company frameworks)
- Company-wide stock plan provides full vesting upon change-in-control unless otherwise specified; PSU vesting based on performance achieved at CIC date; CEO has double-trigger vesting; Shanmugam’s specific CIC terms are not disclosed .
Risk Indicators & Red Flags
- Related-party transactions with controlled entities (Scitus, SS Pharma, Sthree, Esjay) are sizable and recurring, representing potential conflicts of interest and procurement risk .
- Employee-director dual role limits independence; not on independent committees and may face perceived conflicts in Board oversight .
- Anti-pledging and insider trading policies mitigate hedging/short-selling risks; no disclosed exceptions or waivers .
- Strong say-on-pay support reduces governance pressure on compensation design .
Equity Ownership & Vesting Detail (as of March 14, 2025)
| Category | Shares | Notes |
|---|---|---|
| Direct common stock | 29,377 | Owned by Shanmugam |
| Unvested restricted stock | 33,113 | Subject to time-based vesting |
| Unvested PSUs | 15,049 | Performance-based (Adj. EBITDA growth, relative TSR) |
| SS Pharma LLC | 5,000 | Entity controlled by Shanmugam |
| Esjay LLC | 632,620 | Entity controlled by Shanmugam |
| Total beneficial | 715,159 | 3.3% of outstanding |
Employment Terms
- Employment agreement exists (entered at Novitium acquisition), but base salary, bonus targets, severance multiples, non-compete/non-solicit specifics for Shanmugam are not disclosed in the proxy .
Investment Implications
- Alignment: Significant beneficial ownership (3.3%) and unvested PSUs/RSAs support multi-year alignment; anti-pledging and insider trading constraints reduce hedging risks .
- Execution/Value creation: Company-level outperformance vs 2024 objectives and continued Rare Disease growth (Cortrophin Gel) suggest strong operational delivery; PSU metrics tied to EBITDA growth and relative TSR should reinforce value creation .
- Governance risk: Material related-party payments to entities controlled by Shanmugam (especially Sthree Chemicals and Scitus) create conflict-of-interest optics and procurement dependence; monitor Board oversight, audit scrutiny, and any future changes to related-party arrangements .
- Dual-role considerations: As an employee-director, Shanmugam is not independent and does not sit on key committees, which mitigates direct committee influence but heightens independence concerns; no separate director compensation reduces pay conflation risk .
- Trading signals: Upcoming vesting of RSAs and performance certification of PSUs (2024–2026 cycle) could create episodic selling pressure; unvested balances indicate future supply potential—watch Form 4 filings around vest dates and company trading windows .
- Shareholder posture: Strong say-on-pay approval (95.5%) and established clawback/ownership policies point to supportive investor base and governance practices, partially offsetting related-party concerns .