Michael Castagna
MANNKINDAbout Michael Castagna
Michael E. Castagna, Pharm.D., is the CEO and a director of MannKind Corporation, age 48, serving as CEO since May 2017 after joining as Chief Commercial Officer in March 2016; he holds a pharmacy degree from University of the Sciences, a Pharm.D. from Massachusetts College of Pharmacy & Sciences, and an MBA from Wharton . Under his tenure, MannKind’s pay-versus-performance disclosure shows strong cumulative TSR since 2019 (value of $100 investment at 2024 year-end: MNKD $498.45 vs Nasdaq Biotech Index $118.20), with 2024 revenue of $285.5 million and net income of $27.6 million . The equity program emphasizes performance-vesting PSUs tied to relative TSR, with a prior PSU cycle paying out at 198% in May 2024, reflecting execution against shareholder return objectives .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Amgen, Inc. | Vice President, Global Lifecycle Management; later VP, Global Commercial Lead, Biosimilar Business Unit | 2012–2016 | Led biosimilars commercialization initiatives and lifecycle management |
| Bristol-Myers Squibb | Executive Director, Immunology | 2010–2012 | Commercial leadership in immunology portfolio |
| Sandoz (Novartis) | Vice President and Head, Biopharmaceuticals North America | Pre-2010 | Led biopharma business in North America |
| EMD (Merck) Serono; Pharmasset; DuPont Pharmaceuticals | Commercial/Medical Affairs roles | 1997 onward | Progressive commercial and medical affairs experience across biopharma |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Not disclosed in proxy | — | — | No external public-company directorships disclosed for Mr. Castagna |
Fixed Compensation
Multi-year summary for CEO (reported compensation):
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | $623,358 | $701,546 | $766,442 |
| Non-Equity Incentive Plan ($) | $571,619 | $808,181 | $766,442 |
| All Other Compensation ($) | $63,681 | $21,837 | $27,794 |
| Total ($) | $3,905,058 | $7,068,114 | $9,490,628 |
Key fixed pay parameters:
- Target annual bonus opportunity: 80% of base salary for CEO .
- Executive stock ownership guideline: 4× base salary for CEO; all executives currently in compliance .
Performance Compensation
Short-Term Incentive (STI) design and outcomes:
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2024 corporate objectives and assessment: | Metric | Weight | Targeting/Assessment | Result Contribution | |---|---|---|---| | Deliver on Tyvaso DPI production | 30% | Quantitative production goals; qualitative expansion actions | 57.5% | | Drive endocrinology business | 30% | Quantitative financial metrics; qualitative clinical milestones | 35.0% | | Advance pipeline opportunities | 30% | Quantitative development milestones | 21.5% | | Finance/Quality | 10% | Qualitative assessment | 11.0% | | Overall STI Achievement | — | Funding basis | 125.0% |
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CEO 2024 STI paid: $766,442 (reflecting 125% achievement) .
Long-Term Incentives (LTI) structure:
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2024 annual equity awards (grant date May 15, 2024): | Award Type | Shares | Vesting | Performance Metric | |---|---|---|---| | Performance Stock Units (PSUs) | 569,000 | Cliff-vest July 2027 | Relative TSR vs Russell 3000 Pharma & Biotech (25th=50%, 50th=100%, 75th=200%, ≥90th=300%; interpolation) | | Time-based RSUs | 465,000 | 25% annually starting July 15, 2025 through July 15, 2028 | Time-based retention |
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Prior PSU cycle: 2021 PSUs paid out at 198% of target in May 2024 based on relative TSR .
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2024 LTI sizing: CEO guideline ~$4.5 million target value (about 60th percentile vs peers), split ~55% PSUs and ~45% time-based RSUs; grant-date fair value methodology disclosed (Monte Carlo for PSUs) .
Governance and safeguards:
- Dodd-Frank-compliant clawback covering incentive comp tied to financial reporting measures, including stock price and TSR .
- Hedging and pledging of company stock prohibited under Insider Trading Policy .
- No tax gross-ups or structured perquisites; no guaranteed bonuses; emphasis on performance-based pay .
Equity Ownership & Alignment
Beneficial ownership and award status:
| Item | Shares / Detail | Notes |
|---|---|---|
| Total beneficial ownership | 3,318,251 shares (1.1% of total outstanding) | As of March 20, 2025 |
| Common shares | 1,085,563 | Direct holdings |
| Vested options (exercisable) | 1,810,665 shares | Options currently exercisable |
| Unvested options (unexercisable) | 145,275 shares | Unvested at 12/31/2024 |
| RSUs (vesting within 60 days) | 111,023 shares | Included in beneficial ownership calculation |
| PSUs (assumed 100% within 60 days) | 311,000 shares | Beneficial ownership assumption for proximate vesting window |
| 2024 vesting activity | 525,523 shares vested; $3,599,326 value realized; 0 option exercises | Vesting creates share delivery but no 2024 option exercise by CEO |
Ownership policies:
- Executive ownership guideline of 4× salary; both vested and unvested equity counts toward compliance; executives currently in compliance .
- Hedging, short sales, margin purchases, options trading, and pledging are prohibited .
Employment Terms
Severance and change-of-control economics:
- Stand-alone severance: Company reports no severance agreements for executive officers, except for the General Counsel; CEO not covered by separate severance .
- Change-of-control agreements (CEO covered): Double-trigger benefits if terminated without cause or for good reason within two years post-CoC, including:
- 18 months salary continuation and 150% of average annual bonus; continued health benefits up to 18 months; full acceleration of equity awards upon termination following CoC, subject to release .
- Estimated CEO payout under CoC termination as of 12/31/2024: | Component | Amount | |---|---| | Salary continuation and annual STI consideration | $2,998,313 | | Health and welfare benefits | $52,793 | | Accelerated unvested equity awards | $25,782,553 | | Total | $28,833,659 |
Other terms:
- Clawback applies broadly to incentive compensation tied to financial reporting measures .
- No tax gross-ups and no single-trigger CoC equity vesting disclosed; acceleration occurs upon qualifying termination post-CoC .
Board Governance
- Role: CEO and director since 2017; not Chair .
- Independence: Board determined all directors except Castagna (executive) and Binder (former executive) are independent; separation of Chair (Dr. Shannon) and CEO is policy to reinforce independence .
- Committees: Castagna not listed as a member of Audit, Compensation, or Nominating & Corporate Governance committees (all independent) .
- Board activity: Board met nine times in 2024; all directors attended at least 75% of meetings and their committees; independent directors hold regular executive sessions .
- Director compensation program applies to non-employee directors; Castagna, as CEO, is compensated via executive program rather than director fees .
Performance & Track Record
Company performance indicators (per SEC Pay vs Performance):
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Value of $100 investment (MNKD TSR) | 242.64 | 338.76 | 408.53 | 282.17 | 498.45 |
| Value of $100 investment (Nasdaq Biotech Index TSR) | 126.42 | 126.45 | 113.65 | 118.87 | 118.20 |
| Total Revenue ($000s) | 65,144 | 75,442 | 99,770 | 198,962 | 285,504 |
| Net Income (Loss) ($000s) | (57,240) | (80,926) | (87,400) | (11,938) | 27,588 |
Shareholder feedback:
- Say-on-pay approval rates: 2019 67%, 2020 61%, 2021 89%, 2022 88%, 2023 90%, 2024 90% .
Compensation benchmarking:
- Peer group refreshed in 2024 (added Ironwood, Mirum; removed Sangamo, Agenus); target total compensation around median; 2024 LTI guidelines increased to ~60th percentile to remain competitive .
Investment Implications
- Alignment: Heavy performance-vesting PSUs tied to relative TSR, recent PSU payout at 198%, and executive ownership guidelines (CEO 4× salary) signal strong pay-for-performance alignment; hedging/pledging prohibitions reduce misalignment risk .
- Upcoming vesting and potential supply: Large time-based RSUs (465,000 shares) vest 25% annually each July 15 from 2025–2028; PSUs cliff-vest July 2027 subject to TSR outcomes, which can range 0–300% of target—these dates are relevant for monitoring share deliveries and potential insider trading windows .
- Retention and CoC risk: CEO lacks stand-alone severance; CoC agreements are double-trigger with full equity acceleration upon qualifying termination—supports continuity but could amplify payout magnitude in sale scenarios ($28.8M modeled as of 12/31/2024) .
- Governance quality: Separate Chair, independent committees, regular executive sessions, strong clawback, and no tax gross-ups support governance and compensation discipline; stable say-on-pay support at ~90% in 2023–2024 indicates investor acceptance of structure .
- Performance levers: Corporate STI metrics focus on Tyvaso DPI production, endocrinology growth, and pipeline milestones—continued execution here is likely to drive STI payouts and TSR-linked PSU outcomes, creating a clear line-of-sight between operational delivery and realized compensation .
Note: No related-party transactions in 2024 and no delinquent Section 16(a) reports for the CEO were disclosed, which reduces governance red flags for the period .