Sandip Kapadia
About Sandip Kapadia
Sandip Kapadia, 55, is Executive Vice President, Chief Financial Officer and Chief Administrative Officer of Harmony Biosciences (HRMY), a role he has held since March 2021; he holds an MBA from Rutgers, a Bachelor’s from Montclair State, and is a U.S. CPA . Harmony’s 2024 performance included net product revenue of $714.7 million (+23% YoY) and net income of $145.5 million, with Say‑on‑Pay support of 97.6% in 2023, framing an environment of revenue growth and shareholder alignment for incentive design .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Intercept Pharmaceuticals | Chief Financial Officer | 2016–Mar 2021 | Public-company CFO experience in biopharma |
| Novartis (U.S., Switzerland, Netherlands, U.K.) | Various financial leadership roles | ~19 years | Strategic financial oversight across multiple geographies and therapeutic areas |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Molecular Partners AG | Director | Current | External biotech governance and network benefits |
| Passage Bio | Director | Current | Gene therapy exposure and industry insights |
| Alentis Therapeutics | Director | Current | Clinical pipeline perspective and board experience |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 476,625 | 507,606 | 507,606 |
| Target Bonus (% of salary) | 50% | 50% | 50% |
| Actual Annual Bonus Payout (% of target) | — | — | 115% |
| One-Time/Retention Bonus ($) | 175,000 | — | 250,000 (paid 6/30/2024) |
Performance Compensation
Annual Incentive Design and 2024 Outcomes
| Performance Metric | Weight | Target/Threshold Definition | 2024 Actual | Result Level | Payout Reference |
|---|---|---|---|---|---|
| Net Product Revenue (WAKIX) | 25% | Meets at $710–$750M; Exceeds above $750M | $714.7M | Meets Expectations | Company: 123% of target; Kapadia: 115% of target |
| Clinical Development Programs | 20% | Committee assessed | Not quantified | Exceeds Expectations | Company: 123% of target |
| Corporate Transaction Goals | 25% | Committee assessed | Not quantified | Exceeds Expectations | Company: 123% of target |
| Financial Health (stock vs peer group & NBI) | 25% | Relative stock performance vs 2024 peer group and NASDAQ Biotech Index | Not quantified | Meets Expectations | Company: 123% of target |
| Talent & Culture | 5% | Committee assessed | Not quantified | Exceeds Expectations | Company: 123% of target |
Notes:
- Metric-level numeric payouts were not disclosed; overall outcomes were 123% for most NEOs, with CFO Kapadia’s individual modifier resulting in 115% of target .
- Pay-versus-performance disclosure shows 2024 TSR value (base $100 in 2020 → $93) alongside net income and revenue trends, providing broader pay-performance context .
Equity Awards (granted in 2024)
| Grant Type | Grant Date | Shares/Units | Exercise/Strike | Vesting | Grant-Date Fair Value ($) |
|---|---|---|---|---|---|
| Stock Options | 1/24/2024 | 74,250 | $30.69 | 25% on 1st anniversary, then quarterly over next 3 years (12 quarters), service-based | 1,538,052 |
| RSUs | 1/24/2024 | 15,250 | — | 25% annually over 4 years, service-based | 468,023 |
Additional outstanding equity relevant to incentives:
- RSUs (granted 10/4/2023): 90,000 units vest 40%/30%/30% annually starting 9/30/2024 (value $3,096,900 at 12/31/2024) .
- RSUs (granted 3/29/2021): 15,000 units vest 50%/25%/25% through 3/29/2025 (value $516,150 at 12/31/2024) .
- Options (granted 3/29/2021): 230,000 shares at $29.03, vesting 50% at two years then monthly for 24 months; 215,625 exercisable and 14,375 unexercisable as of 12/31/2024 .
2024 realizations:
- Options exercised by Kapadia in 2024: none .
- Stock awards vested in 2024: 75,000 RSUs; value realized $2,903,700 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total Beneficial Ownership | 292,724 shares; less than 1% of outstanding |
| Included in Beneficial Ownership | Includes 243,203 shares issuable upon settlement of options vested or vesting within 60 days of 3/17/2025 |
| Unvested RSUs (12/31/2024) | 90,000 (value $3,096,900), 15,250 (value $524,753), and 15,000 (value $516,150) |
| Options Outstanding (12/31/2024) | 3/29/2021 grant: 215,625 exercisable / 14,375 unexercisable at $29.03; 1/24/2024 grant: 74,250 unexercised at $30.69 |
| Anti‑Hedging | Hedging/monetization transactions prohibited for officers |
| Clawback | Compensation recovery policy for erroneously paid incentive comp received by Section 16 officers on/after Oct 2, 2023; applies to time- or performance-vesting equity |
| Ownership Guidelines | Effective Jan 1, 2025: Other Executive Officers must hold equity equal to 3x base salary; incumbents as of effective date expected to comply by Dec 31, 2026 |
Vesting cadence and potential supply windows:
- RSUs: remaining 25% of 2021 grant vests 3/29/2025; 2024 RSUs vest 25% annually each Jan 24 (2025–2028); 2023 RSUs vest 30% on 9/30/2025 and 30% on 9/30/2026 .
- Options: 2024 grant begins vesting 1/24/2025 on a 25%/quarterly schedule; 2021 grant completes vesting by 3/29/2025 under its schedule .
Employment Terms
| Provision | Key Terms |
|---|---|
| Employment Agreement | Effective March 31, 2021; base salary originally $465,000; target bonus 50% of salary |
| Non‑Compete/Non‑Solicit | One year post‑employment; confidentiality included |
| 280G Treatment | “Best pay” cutback to avoid excise tax under Section 4999 |
| Severance (No CIC) | If terminated without cause or resigns for good reason: 12 months base salary, 12 months health coverage, up to 12 months outplacement; additional 12 months of vesting on 2021 option/RSU; value example at 12/31/2024: cash $507,606; equity acceleration $3,690,387; healthcare $39,665; outplacement $14,000 |
| CIC + Qualifying Termination | Above plus pro‑rated target bonus; full acceleration of 2021 option/RSU; value example at 12/31/2024: cash $761,409; equity acceleration $4,491,349; healthcare $39,665; outplacement $14,000 |
| Special RSU Provision (Oct 2023 grant) | 90,000 RSUs vest upon termination without cause; and vest upon resignation for any reason after Sept 30, 2024 (subject to release) |
Compensation Structure Analysis
- Mix and risk: Compensation skews toward at‑risk incentives (annual bonus and equity) with modest perquisites; no tax gross‑ups, no defined benefit pension/SERP, and clawback policy in place, aligning with investor‑friendly practices .
- Metrics and rigor: 2024 plan included absolute revenue, relative stock performance (vs peer group and NASDAQ Biotechnology Index), pipeline and transaction execution, driving a 123% corporate outcome; CFO payout was 115%, reflecting individual adjustments .
- Equity design: Shifted to time-vesting options and RSUs with multi‑year schedules; 2023 RSU special terms increase certainty of equity delivery post‑9/30/2024, reducing retention friction but improving alignment certainty through equity ownership .
- Peer benchmarking: Compensation decisions informed by a biotech peer set with independent consultant (Pay Governance) engaged; committee independence affirmed .
Risk Indicators & Red Flags (Selected)
- Resignation-vest feature on 2023 RSU (90,000 units) after Sept 30, 2024 may reduce retention friction and could increase share supply upon departure, though it also de‑risks equity realization for the executive .
- No 2024 option exercises by Kapadia mitigates immediate selling overhang from option exercises; however, RSU vestings in 2024 totaled 75,000 shares, indicating periodic supply from time‑vested equity .
Compensation Peer Group and Shareholder Feedback
- 2024 peer group used for decisions included companies such as Acadia, Axsome, Ionis, Neurocrine Biosciences, Supernus, Alkermes, Catalyst, Jazz, PTC, Avadel, Intra‑Cellular, “Mariuns,” and Sage Therapeutics (as listed) .
- Say‑on‑Pay approval was 97.6% in 2023, signaling strong shareholder support for pay design .
Investment Implications
- Near‑term vesting windows (3/29/2025; 1/24/2025–2028; 9/30/2025–2026) and the 2023 RSU resignation‑vest feature could create episodic insider selling pressure, particularly around quarterly/annual vest dates, despite no 2024 option exercises by Kapadia .
- Alignment signals are constructive: significant unvested equity exposure, anti‑hedging policy, a formal clawback, and newly adopted ownership guidelines (3x salary for executives with compliance by 12/31/2026) reinforce long‑term orientation .
- Retention risk appears balanced: severance economics are moderate (12 months base plus benefits; pro‑rated bonus upon CIC termination), while the 2023 RSU feature lowers friction to depart post‑9/30/2024; watch for role changes or 8‑K 5.02 filings that could trigger accelerated equity delivery .