Christopher Anzalone
About Christopher Anzalone
Christopher Anzalone, PhD, is President, Chief Executive Officer, Board Chair, and Director of Arrowhead Pharmaceuticals (ARWR). He has served as CEO and Director since December 1, 2007 and was appointed Board Chair following the prior chair’s retirement; the Board maintains a Lead Independent Director structure to mitigate combined role risks . Dr. Anzalone holds a PhD in Biology from UCLA and a BA in Government from Lawrence University . Performance context: FY2024 revenue was $3.6M vs $240.7M in FY2023 and $243.2M in FY2022; net loss was $599.5M in FY2024, $205.3M in FY2023, and $176.1M in FY2022; three-year TSR was at the 28th percentile of the peer group as of September 2024 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Galway Partners, LLC | Partner | 1999–2003 | Sourced, structured and built ventures; private equity leadership |
| Benet Group LLC | Founder & CEO | Not disclosed | Created and built nano-biotech companies from university science |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| None disclosed | — | — | — |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $863,417 | $902,522 | $951,012 |
| Target Bonus (% of salary) | Not disclosed | 100% | 100% |
| CEO Annual Cash Incentive Cap | 150% of base salary | 150% of base salary | 150% of base salary |
| Actual Annual Incentive Paid ($) | $783,315 (paid partly in stock) | $700,000 | $1,152,000 (includes $192,000 contingent on HSR clearance) |
Notes:
- No executive retirement plans; no perquisites; no tax gross-ups on severance/CIC .
Performance Compensation
| Metric | Weighting | Target | Actual | Payout | Vesting/Mechanics |
|---|---|---|---|---|---|
| Corporate/Business Development | 40% | Execute recapitalization, supply prep, commercial readiness | Achieved: strategic transaction and recapitalization; Verona manufacturing commitments; medical affairs field force deployed | Contributed to overall 120% payout for CEO | Cash bonus; CEO cap 150% |
| Clinical Development & Regulatory | 40% | Launch Phase 3s; EAP; NDA submission | Achieved: three Phase 3s; EAP; NDA submitted and accepted (PDUFA Nov 18, 2025) | Contributed to overall 120% payout for CEO | Cash bonus |
| Discovery & Early Development | 20% | Hit timelines; file CTAs; nominate candidates | Achieved: seven Phase 1 milestones; three CTAs; six candidates nominated | Contributed to overall 120% payout for CEO | Cash bonus |
| CEO PRSU Grant (Dec 22, 2023; 340,000 units) | 100% PRSU | Performance trigger: $1B cash inflow by June 30, 2025 | Not disclosed as achieved as of proxy | N/A | Vests only upon performance certification; no dividends on unvested awards |
| Prior PRSU Milestone (issued 12/2022) | — | Maintain trials in four tissue types | Certified Oct 2023 | 46,805 shares vested | PRSU vesting upon certified milestone |
Pay-versus-performance summary (PEO “compensation actually paid”):
- FY2024: ($5,232,848); FY2023: ($2,160,939); FY2022: ($40,073,641); FY2021: $69,061,855 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (CEO) | 3,764,252 shares; 3.0% of outstanding |
| Ownership Guidelines | CEO: 6x base salary; CFO: 2x base salary |
| Guideline Compliance | CEO and CFO have achieved required ownership levels |
| Hedging/Pledging Policy | Hedging prohibited; pledging permitted up to 75% of owned and vested shares with Board approval |
| Unvested RSUs (CEO at 9/30/2024) | 49,761 RSUs; MV $963,871 |
| Unearned PRSUs (CEO at 9/30/2024) | 700,000 (1/1/2020); 800,000 (1/1/2021); 149,282 (7/8/2022); 93,610 (12/20/2022); 340,000 (12/22/2023) |
| Market Value of Unearned Stock (CEO) | $13,559,000 (2020 PRSU), $15,496,000 (2021 PRSU), $2,891,592 (2022 PRSU), $1,813,226 (2022 PRSU), $6,585,800 (2023 PRSU) using $19.37 share price |
| FY2024 Option/RSU Activity | Options exercised: 57,499 shares; RSUs/PRSUs vested: 95,087 shares |
| Director Pay for CEO | Employee directors receive no separate director compensation |
Insider selling pressure context:
- January 2024 equity offering lock-up agreements signed by directors and officers, including the CEO, restricted sales for 60 days with specified exceptions (e.g., pre-existing 10b5-1 plans, tax-withholding transactions) .
Employment Terms
| Provision | CEO Terms |
|---|---|
| Employment Agreement | Written agreement in place |
| Severance (without Cause or for Good Reason) | Lump sum equal to one month base salary plus 30 days medical/dental premiums; requires release |
| Good Reason Definition | Includes material diminishment of duties/titles, relocation >30 highway miles from Pasadena, successor assumption failure, or material breach |
| Change-of-Control (Equity) | Company plans provide single-trigger acceleration for participants, except CEO’s awards accelerate only upon “double-trigger” (CIC plus qualifying termination) |
| Clawback | Non-fault clawback on incentive comp upon financial restatement; plans allow recovery per listing rules |
| Non-Compete/Non-Solicit | Not disclosed |
Estimated termination/change-in-control payouts (as of 9/30/2024):
- Termination without Cause: $82,307 (salary + benefits) .
- Involuntary termination after CIC: $42,751,725 including acceleration of stock awards at $19.37/share; salary $80,000; benefits $2,307 .
Board Governance
- Roles: CEO is Board Chair; Board maintains a Lead Independent Director (William Waddill) to strengthen independence and oversee executive sessions .
- Independence: Majority independent; CEO not independent due to employment .
- Committees: Audit, Compensation, Nomination composed entirely of independent directors .
- Meeting Attendance: All incumbent directors attended 100% of Board and committee meetings in FY2024; directors standing for re-election attended the virtual 2024 annual meeting .
- Executive Sessions: Regular independent director executive sessions .
- Science Committee: Established; co-chaired by Mauro Ferrari and Adeoye Olukotun .
Director Compensation (for non-employee directors; CEO excluded)
| Item | FY2024 |
|---|---|
| Annual Cash Retainer | $80,000 (non-employee directors) |
| Additional Chair Retainers | $15,000 (Non-Executive Chairman; legacy framework) |
| Committee Chair Fees | $5,000 (Audit; Compensation) |
| Equity | RSUs; typical annual RSUs vest in one year; new director sign-on may vest over three years |
| Example Total Comp (non-employee) | Waddill: $470,833 total ($90,000 cash; $380,833 stock awards) |
Compensation Governance and Peer Benchmarking
- Compensation Consultant: Compensia engaged since 2018; no conflicts; supports peer selection and program design .
- Peer Group (FY2024): Includes ACADIA, Amicus, Apellis, Arcus, BioCryst, Blueprint, BridgeBio, CRISPR, Deciphera, Denali, Halozyme, Insmed, Intellia, Ionis, Ironwood, Mirati, Madrigal, REGENXBIO, Sarepta, Ultragenyx, Vir; Arrowhead generally assesses relative to market median rather than targeting a specific percentile .
- Say-on-Pay: 94% support at 2024 annual meeting (82,576,047 FOR; 4,950,419 AGAINST; 143,385 ABSTAIN) .
Performance & Track Record
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenue ($) | $243.2M | $240.7M | $3.6M |
| Net Loss ($) | ($176.1M) | ($205.3M) | ($599.5M) |
| Diluted EPS ($) | ($1.67) | ($1.92) | ($5.00) |
| Cash & Investments (9/30/2024) | — | — | $681.0M |
| 3-Year TSR Percentile | — | — | 28th percentile vs. peers |
Strategic highlights under Anzalone’s leadership include advancing plozasiran through multiple Phase 3 trials with an NDA accepted and PDUFA date set for November 18, 2025; executing a major collaboration with Sarepta (upfront $500M cash plus $325M equity and $250M over five years, potential $10B milestones, royalties); and expanding early-stage pipeline in obesity/metabolic and complement-mediated disease .
Legal and execution risks: Arrowhead filed for declaratory judgment against Ionis regarding a patent related to plozasiran; management asserts non-infringement and invalidity claims, but litigation poses uncertainty around commercialization timing and economics .
Investment Implications
- Pay-for-performance alignment: CEO’s long-term equity is 100% performance-based in FY2024 with a demanding $1B cash inflow trigger by June 30, 2025; annual incentive metrics tied to BD, clinical, and discovery milestones with defined weightings; clawback and ownership policies further align interests .
- Governance mitigants to dual role: Combined CEO/Chair increases influence but is counterbalanced by a Lead Independent Director, fully independent committees, and regular executive sessions; meeting attendance is strong, and say-on-pay support is high (94%) which signals investor acceptance of the program .
- Retention and selling pressure: Significant unearned PRSUs and RSUs (multi-year) create retention hooks; pledging up to 75% with Board approval is a potential alignment risk, but hedging is prohibited and CEO satisfies a robust 6x salary ownership guideline; the Jan 2024 lock-up temporarily constrained insider sales .
- Change-of-control economics: CEO equity requires double-trigger for acceleration, limiting windfall risk; base severance is conservative (one month + 30 days benefits), which reduces pay-for-failure risk versus typical market multiples .
- Execution risk and catalysts: Near-term value hinges on plozasiran regulatory outcome and resolution of Ionis litigation; the Sarepta deal and cash balance support runway, but revenue volatility and Pay vs Performance outcomes reflect share price sensitivity to milestone timing .
Overall, compensation structure is meaningfully at risk and milestone-driven with clear governance safeguards; key trading signals center on progress toward the $1B PRSU trigger, FDA decisions for plozasiran, and litigation developments that could materially influence compensation realization, insider behavior, and stock performance .