Harith Rajagopalan, M.D., Ph.D.
About Harith Rajagopalan, M.D., Ph.D.
Co‑founder of Fractyl Health (2010) and CEO since 2011; currently also serves as a director (Class III), age 48, with no board committee assignments and not an independent director . Education and training: B.S. in chemistry (Stanford); M.D. and Ph.D. (Johns Hopkins School of Medicine); internal medicine and clinical cardiology training at Brigham and Women’s Hospital (2005–2011) and a research fellowship at Harvard Medical School (2009–2011) . The board is led by an independent chair (Ajay Royan) with a majority of independent directors, mitigating dual‑role governance concerns for a CEO/director structure .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| General Catalyst Partners | Entrepreneur‑in‑Residence | 2009–2011 | Venture creation leading to co‑founding Fractyl Health |
| Brigham and Women’s Hospital | Internal medicine and clinical cardiology training | 2005–2011 | Clinical foundation in cardiometabolic disease |
| Harvard Medical School | Research fellow | 2009–2011 | Translational research experience informing product strategy |
External Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Erase T2D Task Force (company‑convened advisory group) | Co‑chair | As of 2024 filing | Leads external scientific advisors guiding metabolic disease strategy |
Fixed Compensation
| Year | Base Salary (Approved) | Salary Paid | Target Bonus % | Actual Bonus Paid |
|---|---|---|---|---|
| 2024 | $610,000 | $604,462 | 60% | $274,500 |
| 2023 | $550,000 | $550,000 | — | $313,500 |
Performance Compensation
Annual Cash Bonus (2024) – Plan metrics and outcome
| Metric category | Weighting | Outcome | Payout impact |
|---|---|---|---|
| REVEAL‑1 enrollment/data reporting | 10% | Part of corporate goal set assessed by Board | 75% of target overall payout approved |
| REMAIN‑1 enrollment progress | 70% | Part of corporate goal set assessed by Board | 75% of target overall payout approved |
| Rejuva regulatory feedback/manufacturability | 10% | Part of corporate goal set assessed by Board | 75% of target overall payout approved |
| Commercialization progress | 10% | Part of corporate goal set assessed by Board | 75% of target overall payout approved |
CEO’s 2024 target bonus was 60% of base salary; the Board approved payout at 75% of target, resulting in $274,500 paid for 2024 .
2024 Performance‑Based Stock Options (granted at IPO)
| Attribute | Detail |
|---|---|
| Grant date and size | 2/1/2024; 435,900 options |
| Exercise price | $15.00 per share |
| Milestone structure | 40% REVITALIZE‑1; 40% REMAIN‑1; 20% Rejuva (Feb 1–Dec 31, 2024 performance period) |
| Earn‑out result (determined 2/27/2025) | REVITALIZE‑1 not achieved; REMAIN‑1 and Rejuva achieved → 60% of award earned |
| Vesting of earned portion | 25% on 12/31/2024; remaining 75% in equal annual installments over next 3 anniversaries, subject to service |
| Shares vested/unvested from earn‑out | 65,385 vested and 196,155 unvested as of 12/31/2024 (matches 25%/75% of 60% earn‑out) |
Outstanding equity awards (CEO) at 12/31/2024
| Vesting Start | Exercisable | Unexercisable | Exercise Price | Expiration |
|---|---|---|---|---|
| 3/1/2015 | 123,484 | — | $1.70 | 2/9/2025 |
| 12/17/2015 | 345,078 | — | $2.67 | 12/16/2025 |
| 6/27/2016 | 179,868 | — | $2.67 | 6/26/2026 |
| 3/14/2018 | 422,473 | — | $3.35 | 3/13/2028 |
| 3/26/2020 | 475,021 | — | $3.89 | 3/25/2030 |
| 6/24/2021 | 230,073 | 32,864 | $6.98 | 6/23/2031 |
| 9/7/2022 | 9,180 | 7,129 | $8.59 | 9/6/2032 |
| 3/16/2023 | 14,273 | 18,345 | $8.18 | 3/15/2033 |
| 11/10/2023 | 4,258 | 12,773 | $11.21 | 11/9/2033 |
| 2/1/2024 (performance‑based) | 65,385 | 196,155 | $15.00 | 1/31/2034 |
Equity award timing policy states no timing of grants around MNPI; hedging and pledging are prohibited by policy .
Equity Ownership & Alignment
Beneficial ownership summary
| As‑of date | Shares beneficially owned | % Outstanding |
|---|---|---|
| April 16, 2025 | 2,872,738 | 5.7% |
| August 6, 2025 | 2,881,950 | 5.5% |
Ownership breakdown
| As‑of date | Directly held | Family trusts | Options exercisable/within 60 days |
|---|---|---|---|
| April 16, 2025 | 491,329 | 602,980 | 1,778,429 |
| August 6, 2025 | 491,329 | 602,980 | 1,787,641 |
- Insider trading/hedging: Company policy bans hedging and pledging; no pledges disclosed .
- 10b5‑1 plans: Adopted a plan on 9/12/2024 for up to 438,420 shares through 3/31/2025; adopted a new plan on 8/29/2025 for up to 483,885 shares through 6/26/2026, indicating pre‑scheduled potential selling overhang .
- Near‑term expirations that can drive exercises/liquidity: 123,484 options at $1.70 expiring 2/9/2025; 345,078 at $2.67 expiring 12/16/2025 .
Employment Terms
| Provision | CEO terms |
|---|---|
| Employment agreement | New agreement at IPO; base salary and target bonus aligned with 2024 levels |
| Severance (without cause/for good reason) | 12 months’ base salary + up to 12 months COBRA; CEO also receives a cash lump sum equal to 1.0x target annual bonus, subject to release and covenants |
| Change‑of‑control (double‑trigger; within 3 months before or 18 months after CoC) | 1.5x base salary paid over 18 months; 18 months COBRA; 1.5x target annual bonus lump sum; full acceleration of unvested time‑based equity, subject to release and covenants |
| Definitions and covenants | “Cause” and “Good Reason” defined; restrictive covenants apply; clawback policy compliant with Nasdaq |
Board Governance (service history, committees, independence)
- Board service: Director (Class III); “Director Since: 2010”; age 48; no board committee memberships .
- Board structure: Independent Chairman (Ajay Royan); majority independent board; executive sessions held; committees fully independent .
- Committees overview (for governance quality context):
- Audit Committee: Kelly Barnes (Chair), Marc Elia, Ajay Royan; 5 meetings in 2024; all independent; Barnes is an “audit committee financial expert” .
- Compensation & Human Strategy: Clive Meanwell (Chair), Kelly Barnes, Samuel Conaway; independent; 3 meetings in 2024 .
- Nominating & Corporate Governance: William W. Bradley (Chair), Ajay Royan, Amy W. Schulman; independent; 1 meeting in 2024 .
Director and Transaction Context
- Non‑employee director compensation program (context for dual roles): annual cash retainer $43,500; initial 45,000‑share option at $15.00; annual 22,500‑share option; additional committee chair/membership retainers; all vesting/lapse terms specified (applies to non‑employee directors; CEO does not receive these retainers) .
- Underwritten offering lock‑up: Officers/directors agreed to a 45‑day lock‑up starting August 7, 2025 (limited exceptions), briefly dampening near‑term selling capacity around the financing window .
- Related person transactions: Pre‑IPO ROFR/Co‑Sale arrangements terminated at IPO; board‑adopted policy governs related‑party transactions; D&O indemnification and insurance in place .
Compensation Structure Analysis
- Heavy at‑risk/equity mix post‑IPO: 2024 total comp ($4.86M) comprised primarily of option award grant‑date value ($3.98M) plus performance cash bonus ($0.27M), indicating leverage to milestones and share price rather than guaranteed cash .
- Explicit milestone‑linked equity: 2024 performance options tied 40/40/20 to clinical/regulatory milestones across REVITALIZE‑1, REMAIN‑1, Rejuva; only 60% earned, reflecting objective gating and execution risk; vesting extends three years to support retention .
- Cash incentives tied to development/commercial objectives: 2024 corporate goals weighted to REMAIN‑1 enrollment (70%); payout set at 75% of target, signaling partial achievement and disciplined calibration by the board .
- Governance safeguards: Nasdaq‑compliant clawback and hedging/pledging prohibitions reduce misalignment and risk of collateralized share overhang .
Equity Ownership & Alignment (implications)
- Material insider stake: ~5.5%–5.7% beneficial ownership across 2025 dates with a large option component, aligning incentives but introducing option‑exercise timing considerations .
- Pre‑scheduled selling: 10b5‑1 plans for up to 438k shares (through 3/31/2025) and 484k shares (through 6/26/2026) suggest manageable but non‑trivial selling pressure windows, especially around clinical/regulatory catalysts .
Investment Implications
- Alignment: Compensation is strongly milestone‑ and equity‑linked (60% of 2024 performance option earned; cash bonus paid at 75% of target), indicating pay‑for‑progress while spreading vesting over multiple years to retain talent .
- Overhang and timing: Large expiring, in‑the‑money legacy options (2025–2026 expiries) and active 10b5‑1 plans could create episodic selling into strength; monitor Form 4s around catalyst windows and vest dates (e.g., annual anniversaries post‑12/31/2024) .
- Downside/CoC protections: Enhanced double‑trigger CoC severance (1.5x salary and bonus; full time‑based equity acceleration) may increase M&A flexibility but raises change‑of‑control costs; standard severance is moderate (12 months plus 1x bonus) .
- Governance: Independent chair and fully independent committees offset CEO/director dual role; hedging/pledging ban is shareholder‑friendly and reduces alignment risk .