Alan Auerbach
About Alan Auerbach
Alan H. Auerbach is Chairman, President, Chief Executive Officer and Secretary of Puma Biotechnology, serving since the company’s inception in September 2010. He previously founded Cougar Biotechnology and led it until its acquisition by Johnson & Johnson, then co-chaired Cougar’s integration steering committee; earlier, he was a senior biotech research analyst at Wells Fargo Securities. He holds a B.S. in Biomedical Engineering from Boston University and an M.S. in Biomedical Engineering from USC . Company performance indicators relevant to pay and alignment include PBYI total shareholder return (value of $100 initial investment) of $117 in 2020, $35 in 2021, $48 in 2022, $49 in 2023, and $35 in 2024; net income of ($59,995,000) in 2020, ($29,126,000) in 2021, $2,000 in 2022, $21,591,000 in 2023, and $30,278,000 in 2024 . Revenues were $225.1m (2020), $253.2m (2021), $228.0m (2022), $235.6m (2023), and $230.5m (2024) *.
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Puma Biotechnology | Chairman, President, CEO, Secretary | Since Sep 2010 | Founding leader driving strategy, commercial execution |
| Cougar Biotechnology | CEO, President, Director | May 2003–Jul 2009 | Led to sale to J&J; advanced abiraterone program |
| Johnson & Johnson (Cougar integration) | Co-Chair, Integration Steering Committee | Jul 2009–Jan 2010 | Oversaw development/commercialization of abiraterone |
| Wells Fargo Securities | VP, Senior Research Analyst (Oncology biotech coverage) | Jun 1998–Apr 2003 | Sell‑side coverage of small/mid-cap oncology biotech |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Radius Health, Inc. | Director | Oct 2010–May 2011 (predecessor), May 2011–Dec 2017 | Governance oversight in women’s health therapeutics |
Fixed Compensation
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Annual Base Salary ($) | 877,871 | 904,207 | 931,333 |
| Target Bonus (% of Salary) | — | 65% | — |
2024 Summary Compensation Table (CEO):
| Component ($) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | 852,302 | 877,871 | 904,207 |
| Stock Awards (RSUs grant-date fair value) | 393,360 | 818,309 | 1,055,548 |
| Option Awards (grant-date fair value) | 394,837 | 821,842 | 1,055,354 |
| Non-Equity Incentive Plan Compensation | 877,530 | 407,991 | 938,612 |
| All Other Compensation | 14,732 | 18,735 | 16,210 |
| Total | 2,532,761 | 2,944,748 | 3,969,931 |
Notes:
- CEO target bonus tied 100% to corporate metrics; 2024 payout at 159.7% of target based on metric attainment .
Performance Compensation
Annual Short-Term Incentive Program (2024 – CEO 100% corporate metrics):
| Metric | Weight | Threshold | Target | Maximum | Actual | Attainment (% of target) | Payout after weighting |
|---|---|---|---|---|---|---|---|
| Total Revenue (sum of product revenue, net, plus royalty; less license) | 40% | $209.4m | $222.5m | $235.6m | $230.5m | 161.2% | 64.5% |
| Cash Management (delta cash & equivalents + marketable securities, adjusted) | 30% | $(13.1)m | $(6.6)m | $0 | $5.0m | 200.0% | 60.0% |
| Alisertib study 4201 enrollments | 15% | ≤20 | ≥40 (by 12/31/24) | ≥40 (by 10/31/24) | 27 | 35.0% | 5.3% |
| Alisertib study 1201 enrollments | 15% | 0 | ≥1 (by 12/31/24) | ≥5 (by 12/31/24) | 5 | 200.0% | 30.0% |
| Weighted Corporate Attainment (CEO payout factor) | — | — | — | — | — | — | 159.7% |
2024 Long-Term Equity Awards and Vesting:
| Grant Date | Type | Quantity | Exercise/Base Price | Vesting | Grant-Date FV ($) |
|---|---|---|---|---|---|
| 2/12/2024 | Stock Options | 222,573 | $6.36 | 25% on 7/1/24, 1/1/25, 7/1/25, 1/1/26 | 1,022,501 |
| 2/12/2024 | RSUs | 160,796 | — | 25% on 7/1/24, 1/1/25, 7/1/25, 1/1/26 | 1,022,663 |
| 3/15/2024 | Stock Options (corrective) | 9,047 | $5.00 | Same schedule | 32,853 |
| 3/15/2024 | RSUs (corrective) | 6,577 | — | Same schedule | 32,885 |
Aggregate 2024 equity award values approved by Compensation Committee (dollar-denominated):
| Name | 2023 Aggregate ($) | 2024 Aggregate ($) | 2024 Award Mix | 2024 Shares Granted |
|---|---|---|---|---|
| Alan H. Auerbach | 1,755,100 | 1,700,300 | ~50% options / ~50% RSUs | Options 231,620; RSUs 167,373 |
Vesting mechanics:
- RSUs and options: one-fourth vests on each of 7/1/2024, 1/1/2025, 7/1/2025, and 1/1/2026; certain awards eligible for acceleration upon CIC-related termination .
Realized equity in 2024:
| Name | RSUs Vested (shares) | Value Realized ($) |
|---|---|---|
| Alan H. Auerbach | 202,233 | 809,736 |
Equity Ownership & Alignment
Beneficial Ownership (as of 4/21/2025):
| Holder | Shares Beneficially Owned | % of Outstanding | Breakdown |
|---|---|---|---|
| Alan H. Auerbach | 10,456,980 | 19.7% | 6,945,987 shares held; 2,116,250 shares via Auerbach Warrant; 1,394,743 options exercisable within 60 days |
Outstanding CEO Equity (12/31/2024):
| Instrument | Exercisable | Unexercisable | Exercise Price | Expiration | Notes |
|---|---|---|---|---|---|
| Auerbach Warrant | 2,116,250 | — | $16.00 | 10/4/2026 | Issued 2011 |
| Stock Options | 150,000 | — | $76.54 | 10/4/2025 | — |
| Stock Options | 66,667 | — | $35.61 | 5/22/2026 | — |
| Stock Options | 70,000 | — | $37.35 | 2/16/2027 | — |
| Stock Options | 56,940 | — | $60.85 | 2/11/2028 | — |
| Stock Options | 62,634 | — | $27.76 | 2/6/2029 | — |
| Stock Options | 161,649 | — | $12.34 | 2/11/2030 | — |
| Stock Options | 210,944 | — | $12.02 | 2/17/2031 | — |
| Stock Options | 241,176 | — | $2.33 | 3/3/2032 | ITM at $3.05 year-end price |
| Stock Options | 194,193 | 64,731 | $4.39 | 2/10/2033 | — |
| Stock Options | 55,643 | 166,930 | $6.36 | 2/12/2034 | — |
| Stock Options | 2,261 | 6,786 | $5.00 | 3/15/2034 | — |
| RSUs (unvested) | — | 46,601 | — | — | Market value $142,133 at $3.05 |
| RSUs (unvested) | — | 120,597 | — | — | Market value $367,821 at $3.05 |
Policies and guidelines:
- Hedging and pledging prohibited for officers/directors; margin purchases and derivative transactions barred .
- Executive stock ownership guidelines: CEO 3x base salary; all NEOs met guidelines as of 12/31/2024 .
Insider selling pressure indicators:
- Significant RSU vesting in 2024 (202,233 shares) while no option exercises by NEOs in 2024; near-term semiannual vesting cadence continues through 1/1/2026 .
Employment Terms
| Provision | Terms |
|---|---|
| Employment Agreement | Effective Jan 19, 2012; original term through Sep 1, 2014; auto-renewing one-year terms thereafter |
| Board Nomination Clause | Company will nominate Auerbach for election to Board during agreement term |
| Severance (non‑CIC) | Salary plus maximum annual short‑term cash incentive eligibility for the year, paid over 12 months; up to 18 months healthcare continuation |
| CIC Double‑Trigger Window | Termination without cause or for good reason within 60 days before or 18 months after a change in control |
| CIC Severance | Lump sum 2x (salary + maximum annual short‑term incentive eligibility); immediate vesting of all unvested equity; options exercisable up to 12 months post-termination; up to 18 months healthcare |
| 280G Treatment | “Best‑net” approach: reduce to avoid excise tax or pay full and reimburse excise tax plus taxes (gross‑up) if reduction not beneficial |
| Clawback | Recovery of erroneously paid incentive compensation (cash or equity) for Section 16 officers upon required restatement per SEC/Nasdaq rules |
Board Governance
- Role: Combined CEO and Chairman; Board asserts this structure suits company size/resources; Lead Independent Director (Jay M. Moyes) with explicit responsibilities to preside executive sessions, approve agendas, and serve as liaison .
- Meetings/Attendance: Board met 4 times in FY2024; all directors ≥75% attendance; executive sessions held: Board (4), Audit (5), Compensation (5), Nominating & Corporate Governance (2) .
- Committees: Audit, Compensation, Nominating & Corporate Governance, Equity Incentive, and R&D Committees; Compensation Committee members: Brian Stuglik (Chair), Michael P. Miller, Jay M. Moyes .
- Independence/Practices: Compensation Committee is independent; independent compensation advisor engaged; no repricing of options without shareholder approval; hedging/pledging prohibited .
- Director compensation: CEO receives no additional director pay; non-employee directors compensated via cash retainers and RSUs per director program .
Say-On-Pay & Shareholder Feedback
- 2024 say-on-pay approval: approximately 96% of votes cast supported NEO compensation; Board adopted annual say-on-pay frequency following the 2024 frequency vote recommendation .
Compensation Peer Group (Benchmarking)
- Peer selection criteria: US pipeline-stage therapeutics biotech; revenues $0–$297m (Puma at $244m, 85th percentile), market cap $27m–$399m (Puma $146m, 28th percentile); considerations include 1- and 3-year TSR and headcount .
- Target percentile: CEO long-term incentive values aligned to the 50th percentile, adjusted for prior-year performance (2023 corporate goals achieved at 71.5%); CEO 2024 equity award below peer median despite market median increases .
Performance & Track Record
Pay‑Versus‑Performance key metrics:
| Metric | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|---|
| PBYI Total Shareholder Return (Index) | 117 | 35 | 48 | 49 | 35 |
| Net Income ($) | (59,995,000) | (29,126,000) | 2,000 | 21,591,000 | 30,278,000 |
| Company-Selected Measure: Total Revenue (less license revenue) ($) | 202,410,000 | 201,405,000 | 228,031,000 | 235,637,000 | 230,468,000 |
Financial performance (Revenue and EBITDA):
| Metric | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|---|
| Revenues ($) | 225,110,000 * | 253,155,000 * | 228,031,000 * | 235,637,000 * | 230,468,000 * |
| EBITDA ($) | (20,369,000)* | 12,595,000* | 40,560,000* | 44,784,000* | 42,490,000* |
| Values retrieved from S&P Global.* |
Compensation Structure Analysis
- Mix shift: 2024 long-term incentives split ~50/50 between stock options and RSUs; semiannual vesting over two years enhances retention and accelerates realizable pay cadence vs. three-year schedules .
- Pay-for-performance: CEO bonus entirely tied to corporate metrics; 2024 payout above target driven by revenue and cash management outperformance; clinical enrollment mixed (one under target, one maximum) .
- Governance features: Clawback in place; stock ownership guidelines met; prohibitions on hedging/pledging; no single-trigger CIC acceleration; no option repricing without shareholder approval .
Related Party Transactions and Red Flags
- 280G excise tax “best‑net” provision includes potential tax gross‑ups if reduction not beneficial (shareholder‑unfriendly feature) .
- Combined CEO/Chairman structure mitigated by strong Lead Independent Director; continued monitoring of independence appropriate .
- No hedging/pledging allowed; limits misalignment risk .
- No option repricing permitted absent shareholder approval .
- Executive termination disclosed: CCO terminated May 8, 2025; severance per offer letter; responsibilities integrated across sales/marketing functions .
Equity Ownership & Alignment Details
| Item | Detail |
|---|---|
| Ownership guideline compliance | CEO required 3x salary; met as of 12/31/2024 |
| Pledging/Hedging | Prohibited for officers/directors |
| In‑the‑money options | $2.33 strike options ITM at $3.05 year‑end price; many grants at higher strikes remain OTM, limiting exercise/selling pressure |
| RSU cadence | Semiannual vesting (7/1 and 1/1) through 1/1/2026; 2024 vested 202,233 shares |
Employment & Contracts
| Topic | Term |
|---|---|
| Non-compete / non-solicit | Not disclosed |
| Auto-renewal | Successive one-year renewals post Sep 1, 2014 |
| Severance multiple | Non-CIC: 1x salary + max bonus eligibility over 12 months; CIC: 2x lump sum (salary + max bonus eligibility) |
| Equity acceleration | Immediate vesting of all unvested equity upon CIC‑related termination; options exercisable up to 12 months |
| Healthcare | Up to 18 months continuation (both scenarios) |
| Board nomination | Required during agreement term |
Investment Implications
- Alignment: Auerbach beneficially owns ~19.7% of outstanding shares, materially aligning incentives with equity holders; executive ownership guidelines met and pledging/hedging barred .
- Incentive design: CEO’s cash incentive 100% tied to corporate metrics; strong 2024 payout driven by revenue/cash performance; semiannual RSU/option vesting creates predictable, near-term realizable equity that can contribute to supply over 2024–2026 but options largely OTM at year-end, moderating exercise-driven selling .
- Retention/CIC economics: Double-trigger CIC protection with 2x cash and full equity acceleration is market‑standard but includes potential excise tax gross‑ups, modest governance concern; non‑CIC severance at 1x cash reduces abrupt departure risk .
- Governance: Combined CEO/Chairman tempered by empowered Lead Independent Director and active executive sessions; 96% say‑on‑pay support indicates shareholder acceptance of program design, reducing near-term compensation controversy risk .
- Performance backdrop: Revenues stable in the $225–255m range; EBITDA positive since 2021; TSR underperforms peers over 2021–2024 in pay-versus-performance disclosures, suggesting equity grant sizing below peer median is appropriate and reduces dilution risk *.
S&P Global disclaimer: Financial values marked with an asterisk were retrieved from S&P Global.*