Andrew Baum
PFIZERAbout Andrew Baum
Andrew Baum, MA, BM ChB, was appointed Chief Strategy and Innovation Officer and Executive Vice President at Pfizer effective June 2024. He brings extensive clinical and scientific knowledge and financial expertise spanning equity research, hedge funds, investment banking, and shareholder value creation strategies . Under his tenure’s initial period, Pfizer reported 2024 total revenues of $63.6B (7% operational growth; 12% operational growth ex-COVID products) and maintained disciplined capital allocation and cost realignment programs, while one-year TSR at year-end 2024 was -5.3% amid a multi-year TSR decline context . Pfizer highlighted Baum’s role in sharpening strategic focus for R&D investment alongside the CSO transition, and an active BD agenda where Baum noted expanded efforts in China and foundational assets (e.g., 3SBio) on the Q3 2025 call .
Past Roles
Not specifically disclosed in the proxy beyond sectoral experience (equity research, hedge funds, investment banking) and clinical/scientific background .
External Roles
Not disclosed in reviewed filings .
Fixed Compensation
Andrew Baum’s individual base salary, target bonus, and actual bonus are not disclosed (he is not listed among Named Executive Officers (NEOs) in the 2025 proxy) . Pfizer’s program design pays competitive fixed salary, reviewed annually, informed by market data and role scope . The Compensation Committee targets median market compensation using Pharmaceutical Peers and General Industry Comparators and reviews each executive’s mix across salary, annual STI, and LTI each year .
Performance Compensation
Annual Cash Incentive (Global Performance Plan)
| Metric | Weighting | Target Structure | Payout Modifiers | Vesting/Timing |
|---|---|---|---|---|
| Total Revenue | 40% | Annual financial goal; leading indicator of growth | Pipeline Achievement (+/-25pp), ESG Scorecard (+/-5pp) | Paid after year-end based on performance |
| Adjusted Diluted EPS | 40% | Annual financial goal; profitable growth focus | Pipeline/ESG modifiers as above | Paid after year-end based on performance |
| Cash Flow from Operations | 20% | Annual financial goal; liquidity and returns | Pipeline/ESG modifiers as above | Paid after year-end based on performance |
Long-Term Incentives (100% Performance-Based Equity)
| Instrument | Weighting | Key Performance Metrics | Vesting/Settlement | Payout Mechanics |
|---|---|---|---|---|
| 5-Year TSRUs | 25% | Absolute Total Shareholder Return | Vests ~3 years from grant; settles on 5th anniversary | Value equals Settlement Price minus Grant Price plus dividend equivalents; negative TSR yields zero value |
| 7-Year TSRUs | 25% | Absolute Total Shareholder Return | Vests ~3 years from grant; settles on 7th anniversary | Same mechanics as above; program includes ability to extend certain 2022/2023 TSRUs to 7 years via tender to enhance retention |
| Performance Share Awards (PSAs) | 50% | Three 1-year Adjusted Net Income goals plus 3-year relative TSR vs DRG Index; cap at target if TSR negative | 3-year performance period; pays at vest (modifications extended certain 2022/2023 PSAs by two years with performance measured over final three years) | Payout range 0–200%; relative TSR modifier capped at ±25pp (overall cap 200%) |
2024–2025 Equity Program Modifications (Retention-Oriented)
| Award | Modification | Effect on Vesting/Settlement | Rationale |
|---|---|---|---|
| 2022/2023 5-Year TSRUs | Voluntary election to extend term by 2 years (to 7-year TSRUs) | Vesting extended by 2 years; settlement Feb 2029 (2022 grants) or Feb 2030 (2023 grants) | Enhance retention and align with longer-term TSR recovery post-COVID |
| 2022/2023 PSAs | Voluntary election to extend performance/vesting by 2 years | Vest/settle in 2027 (2022 grants) and 2028 (2023 grants); ANI goals set annually for 2025–2027; relative TSR modifier capped at 25pp; cap at target if TSR negative | Increase retentive value and maintain pay-performance alignment |
Equity Ownership & Alignment
- Stock ownership guidelines: CEO 8x salary; other NEOs 4x salary, with progressive milestones over ~5 years and holding requirements until compliance; at 12/31/2024 most NEOs met guidelines, with Denton/Malik on interim milestones (no sales permitted until met). No pledging by NEOs, and hedging/shorts/derivatives prohibited .
- Andrew Baum’s personal ownership, vested/unvested equity, and compliance status are not disclosed in the proxy’s Securities Ownership section (which covers Directors and NEOs) .
Employment Terms
Severance and Change-in-Control
- Executive Severance Plan provides 1–2x base salary plus target bonus based on years of service; cash severance >2.99x salary+target bonus requires shareholder approval. Plan does not provide enhanced severance on change in control .
- LTI change-in-control treatment: if terminated other than for cause within 24 months following a change in control, unvested TSRUs continue to vest and settle on schedule; PSAs continue and settle based on actual performance at period end; RSUs continue to vest per original schedule .
Clawbacks and Conduct
- Dodd-Frank compliant clawback adopted Oct 2023 for erroneously awarded incentive pay upon accounting restatement; additional robust recovery provisions allow cancellation/recoupment for competitive activity, harmful conduct, policy violations, or misuse of confidential information, with RCC input on recoupment after significant compliance events .
Trading, Hedging, and Non-Compete
- Insider trading policy governs executives; hedging/shorts/derivatives prohibited; pledging prohibited for Directors and not in use by NEOs; non-compete agreements implemented as part of leading compensation practices .
Performance & Track Record
Company Performance Context During Baum’s Tenure (initial period)
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Total Revenues ($B) | $58.5 | $63.6 |
| GAAP Net Income ($B) | $2.12 | $8.03 |
| Adjusted Net Income ($B) | $11.24 | $17.96 |
| Cash Dividends Returned ($B) | $9.2 | $9.5 |
| TSR (one-year, year-end) | (41.2%) | (5.3%) |
- Operational revenue growth ex-COVID products: 2024 +12%; company executed cost realignment delivering ~$4.0B net savings in 2024, targeting ~$4.5B by end-2025 .
- R&D momentum: 14 FDA/EMA approvals, 7 pivotal starts, 8 key Phase 3 readouts in 2024; oncology integration (Seagen) strengthened platform and pipeline .
Compensation Structure Analysis
- Year-over-year emphasis on performance-based equity continues (100% LTI as TSRUs/PSAs), aligning payouts to absolute and relative TSR and Adjusted Net Income .
- 2024 tender-style modifications extended vesting/settlement on select legacy TSRUs/PSAs to restore retentive value post-COVID stock volatility—an investor-engaged change disclosed in fall outreach and proxied with rationale; not a repricing, consistent with policy of no option repricing .
- Stock ownership requirements and prohibitions on hedging/pledging strengthen alignment and reduce short-term selling pressure until guideline compliance .
Say-on-Pay & Shareholder Feedback
- Advisory support averages 93.5% over past ten years; support was 91.4% in 2024. The 2025 proxy describes outreach on equity award modifications and rationale to investors prior to proxy season .
Compensation Peer Group (Benchmarking)
- Committee targets median of Pharmaceutical Peers (12) and General Industry Comparators (19) for total compensation levels and plan design benchmarking (metrics, stock ownership guidelines, perquisites, share usage) .
Investment Implications
- Alignment: TSR- and ANI-linked LTI and stringent ownership/holding rules suggest strong long-term alignment; clawback and RCC oversight mitigate conduct/regulatory risk translating into compensation outcomes .
- Retention and selling pressure: The voluntary extension of 2022/2023 TSRUs/PSAs increases retentive value and defers settlement, likely reducing near-term selling pressure for eligible executives; strict ownership milestones further limit discretionary sales until compliance .
- Economics in transition: Severance capped (≤2x salary+bonus, with 2.99x cash cap policy), no single-trigger CIC enhancements, and continued vesting treatment under CIC provide predictable exit economics—reducing change-of-control windfall risk while maintaining continuity incentives .
- Execution signal: Baum’s role central to BD and strategic focus (including China and foundational assets) indicates a proactive external innovation strategy; early-tenure performance context shows revenue recovery ex-COVID and pipeline productivity, but TSR remains challenged—keeping pay outcomes highly sensitive to multi-year TSR and adjusted NI delivery .