J. David Joyner
CVS HEALTHAbout J. David Joyner
J. David Joyner is President and Chief Executive Officer (CEO) of CVS Health and a non‑independent director since October 17, 2024; age 60; B.S., Rawls College of Business at Texas Tech University . He previously led CVS’ Pharmacy Services and has 37 years in health care and pharmacy benefit management starting at Aetna and Caremark; he also serves on the Rawls College of Business Advisory Council (since July 2020) . Under his leadership transition year, CVS delivered 2024 revenue of $372.8B (+4.2% YoY), GAAP net income of $4.6B, Adjusted EPS of $5.42, and consolidated Adjusted Operating Income of $12.0B; annual MIP funding was 32.4% and the 2022–2024 PSU cycle paid 0% due to below‑threshold performance (PSU Adjusted EPS $5.48 vs threshold $8.85) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| CVS Health | President & CEO | Oct 2024–present | Led leadership refresh, focused on operational improvements across Aetna, Caremark, Pharmacy & Consumer Wellness, and Health Care Delivery businesses . |
| CVS Health | EVP & President, Pharmacy Services | Jan 2023–Oct 2024 | Advanced pharmacy models (CostVantage, biosimilars via Cordavis), omnichannel customer experience and execution . |
| Advisor (healthcare enterprises) | Advisor | Sep 2020–Jan 2023 | Advisory work in health care; context for industry experience breadth . |
| CVS Caremark | EVP – Sales & Account Services | 2004–Dec 2019 | Drove PBM sales/account services growth and client relationships . |
| Aetna | Employee Benefit Representative | ~1986–1993 (joined Caremark in 1993) | Foundation in payer/benefits; start of 37‑year health care career . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Rawls College of Business, Texas Tech | Advisory Council Member | Since Jul 2020 | Business school governance and industry linkages . |
| Public company boards | None disclosed | N/A | None; reduces external time commitments . |
Fixed Compensation
| Element | 2024 Amount | Notes |
|---|---|---|
| Base salary | $1,103,495 | Annualized CEO salary $1,500,000 starting Oct 17, 2024 . |
| Target bonus % | 200% of salary (CEO from Oct 17, 2024; pro‑rated 163.6%) | Target annual bonus opportunity $3,000,000 when annualized . |
| Actual bonus paid (MIP) | $0 (declined) | Company MIP funding 32.4%; Joyner requested no 2024 bonus . |
| Perquisites | $113,251 | Includes: aircraft ($15,785), car/driver ($7,713), home security ($82,603) . |
| Pension (Caremark SRP) PV | $2,413,149 | Supplemental non‑qualified plan; change in PVAB (2024): $(19,799) . |
| Deferred comp (DCP) | $55,121 employee + $55,121 match; balance $112,028 | DCP cash deferral and employer match . |
Performance Compensation
| Program | Metric | Weight | Target | Actual/Status | Payout/Outcome | Vesting |
|---|---|---|---|---|---|---|
| 2024 MIP (Annual) | MIP Adjusted Operating Income | 80% | $17,634mm (target) | Below threshold (0% funding) | Company funding 0% from AOI portion | N/A (cash) |
| 2024 MIP (Annual) | Net Promoter Score (NPS) | 20% | Above 2023 baseline | 162% of target (weighted) | Contributed to total 32.4% funding | N/A |
| 2024 MIP (Annual) | Workforce Modifier | Down‑only to (‑10%) | Maintain/improve engagement | No negative adj warranted | Applied at 0% | N/A |
| Joyner 2024 MIP | Individual modifier | 0–120% | Pro‑rated target 163.6% | Declined payment | Final payout 0% | N/A |
| 2024–2026 PSUs | Cumulative Adjusted EPS | 70% | $26.79–$27.33 (target range); min $21.65; max $32.47 | In flight (performance period) | Up to 200% before rTSR modifier | Cliff vest Apr 1, 2027 + 1‑yr holding |
| 2024–2026 PSUs | Strategic Scorecard (3 metrics) | 30% (10% each) | 4+ Star Medicare %; CostVantage %; cross‑sell 2+ offerings (targets undisclosed) | In flight | Up to 200% before rTSR modifier | Cliff vest Apr 1, 2027 + 1‑yr holding |
| 2024–2026 PSUs | rTSR modifier | ±25% (no upward if absolute TSR negative) | Peer S&P 500 Health Care set | Applied at certification | Adjusts total funding | N/A |
| 2022–2024 PSUs | PSU Adjusted EPS (last‑year method) | 100% (legacy design) | Threshold $8.85 | $5.48 in 2024 → below threshold | Payout 0% | Completed |
Equity Ownership & Alignment
| Item | Detail | Value/Status |
|---|---|---|
| Beneficial ownership | Common 46,717; rights to acquire within 60 days 33,049; total 79,766; <1% of outstanding | None pledged for Joyner; anti‑pledging/hedging policy in place . |
| Stock ownership guideline | 7x salary; compliance status: Yes | Reinforces alignment. |
| Unvested RSUs (Dec 31, 2024) | 28,280 (4/1/2024 grant); MV $1,269,489 @ $44.89 | Vests in 4 equal annual installments beginning 4/1/2025 . |
| Unvested PSUs (target) | 29,361 (4/1/2024 grant); MV $1,318,015 @ $44.89 (shown at target) | Performance period 2024–2026; vest 4/1/2027; 1‑yr holding . |
| Premium stock options (11/30/2024) | 1,000,000 options @ $71.82 strike; 7‑yr term; vest in 3 equal annual installments from 11/30/2025 | Out‑of‑the‑money at $44.89 close on 12/31/2024 (intrinsic value $0) . |
| Premium SARs (11/30/2024) | 492,537 SARs @ $71.82 strike; 7‑yr term; vest in 3 equal annual installments | Out‑of‑the‑money at $44.89 close (intrinsic value $0) . |
| Annual stock options (4/1/2024) | 79.56 strike; 10‑yr term; 4‑yr ratable vest | Out‑of‑the‑money at $44.89 close . |
| Scheduled near‑term vesting | 7,070 RSUs settle within 60 days of 3/17/2025 | Potential administrative selling at vest dates (tax withholding) . |
Employment Terms
- Appointment and target compensation: Effective Oct 17, 2024, CEO base salary $1,500,000; target annual bonus $3,000,000 (200% of salary); target annual long‑term incentive $14,500,000; one‑time promotional premium‑priced options/SARs ~$12,000,000 (exercise price 120% of grant‑date market; vest over 3 years) .
- Severance plan (pre‑CIC): For continuing NEOs, up to 18 months of base salary; RSUs continue to vest during severance; PSUs pro‑rated at termination; options/SARs continue to vest through severance period (not retirement‑eligible as of 12/31/2024) .
- Change‑in‑control (CIC): Double trigger; 1.5x base salary + 1.5x target bonus + pro‑rated target bonus; unvested options, RSUs, PSUs vest (PSUs at target); excise tax cutback if beneficial .
- Clawback/recoupment: Dodd‑Frank compliant clawback adopted Sept 2023; robust internal recoupment policy (misconduct, detrimental conduct, RCA breaches, public disclosure on recoupments from executive officers) .
- Insider trading and pledging: Strict pre‑clearance; bans margining, pledging, short sales, and hedging; 10b5‑1 plan governance in place .
Board Governance
- Board service: Director since Oct 2024; non‑independent due to management role .
- Committee roles: Member, Executive Committee (with Executive Chair and other directors); committee can act between Board sessions .
- Dual‑role implications: CEO concurrently on Board; independence mitigated structurally via Executive Chair and Lead Independent Director (LID) roles with defined responsibilities, and majority‑independent Board and committee oversight .
- Attendance: Board average attendance ~97%; directors targeted to attend ≥75%; structural governance highlights include majority voting and proxy access .
Director Compensation (Joyner as executive director)
- As a management (non‑employee) director, Joyner does not receive director retainers; he receives salary/incentives as an executive . Non‑employee director compensation disclosed separately (not applicable to Joyner) .
Compensation Structure Analysis
- Mix changes: 2024 long‑term incentive design updated to 60% PSUs, 20% RSUs, 20% options to align with market and retention; PSUs moved to 3‑year cumulative Adjusted EPS plus strategic scorecard metrics; rTSR modifier retained .
- Pay‑for‑performance alignment: 2024 MIP funded at 32.4% due to below‑threshold AOI; Joyner declined bonus; 2022–2024 PSUs paid 0% given PSU Adjusted EPS $5.48 vs $8.85 threshold .
- One‑time awards: Premium‑priced options/SARs granted upon CEO promotion to tie value solely to stock appreciation; strike set at 120% of market; three‑year vesting .
- Say‑on‑pay support: 2024 advisory vote approval ~85% (vs 80% in 2023), reflecting investor acceptance of program updates .
Risk Indicators & Red Flags
- Zero PSU payout (2022–2024) highlights high performance hurdle and recent underperformance; program design includes downward‑only workforce modifier and no upward rTSR when absolute TSR negative, reducing windfall risk .
- Pledging/hedging: Prohibited by policy; Joyner’s disclosed holdings show none pledged .
- Tax gross‑ups: Broad anti‑gross‑up policy; no executive‑specific gross‑ups disclosed for Joyner; any exceptions apply to broad relocation policy .
- Perquisites: Required security‑related aircraft/driver and home security; disclosed amounts in “All Other Compensation” .
Equity Ownership & Vesting Detail (Selected Outstanding Awards at 12/31/2024)
| Award | Quantity | Strike/Grant | Term | Vesting | Market/Intrinsic Value |
|---|---|---|---|---|---|
| RSUs (4/1/2024) | 28,280 | Grant @ $44.89 MV | — | 4 equal annual installments from 4/1/2025 | $1,269,489 @ $44.89 |
| PSUs (target, 4/1/2024) | 29,361 | Performance @ target | — | Cliff vest 4/1/2027; 1‑yr holding | $1,318,015 @ $44.89 |
| Premium Options (11/30/2024) | 1,000,000 | $71.82 strike | 7 years | 3 annual installments from 11/30/2025 | $0 intrinsic @ $44.89 |
| Premium SARs (11/30/2024) | 492,537 | $71.82 strike | 7 years | 3 annual installments | $0 intrinsic @ $44.89 |
| Annual Options (4/1/2024) | 62,695 (from SCT total) | $79.56 strike | 10 years | 4 equal annual installments | $0 intrinsic @ $44.89 |
Investment Implications
- Alignment and upside: Premium‑priced options/SARs and rTSR‑modified PSUs tie significant value to multi‑year top‑ and bottom‑line execution and stock price appreciation; awards are currently out‑of‑the‑money, which aligns management incentives with shareholder returns .
- Near‑term selling pressure: RSU vesting beginning April 2025 (e.g., 7,070 shares settling within 60 days of 3/17/2025) may create predictable withholding‑related selling but is modest relative to outstanding share count; options currently out‑of‑the‑money, limiting forced exercises .
- Retention risk: Three‑year premium award vesting, 7x ownership guideline (met), and double‑trigger CIC protections reduce near‑term retention risk amidst transformation; clawback and recoupment frameworks mitigate misconduct risk .
- Performance headwinds: 2024 MIP AOI miss and zero PSU payout reinforce high bar; execution on Aetna utilization trends, pharmacy models (CostVantage/TrueCost), and Health Care Delivery integration central to future PSU outcomes .
Overall, Joyner’s package emphasizes long‑term equity with high performance hurdles and premium strikes, strong ownership requirements, and robust clawback/CIC structures. Near‑term cash is restrained (declined 2024 bonus), increasing sensitivity to operational and stock performance outcomes **[64803_0001308179-25-000386_cvs012729_def14a.htm:75]** **[64803_0001308179-25-000386_cvs012729_def14a.htm:99]** **[64803_0001308179-25-000386_cvs012729_def14a.htm:107]**.