Regeneron’s (NSDQ:REGN) top two execs, CEO Dr. Leonard Schleifer and CSO Dr. George Yancopoulos, are two of the best-paid in biotech. 

Two proxy advisory service firms, Glass Lewis (San Francisco, Calif.) and Institutional Shareholder Services (Rockville, Md.), are balking at Regeneron’s executive pay program and practices. 

The two firms are urging shareholders to oust George Sing from the company’s board at the company’s annual general meeting on June 11. Sing is a member of Regeneron’s compensation committee. 

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Last year, Schleifer earned $135.4 million, including some $130.0 million in stock awards, according to an SEC proxy filing. For comparison, he earned $21.5 million in 2019. 

Chief science officer Yancopoulos earned $134.4 million in 2020, including $130.0 million in stock awards. He earned $20.7 million in 2019. 

The two execs’ earnings last year resulted from a decision from Regeneron’s board to provide Schleifer and Yancopoulos with performance-restricted stock units (PSUs) rather than annual stock options.

“Considering ongoing shareholder concerns regarding the company’s granting practices, we question whether these front-loaded grants are in the best interests of shareholders and whether the compensation committee has responded appropriately to shareholder concerns,” explained Glass Lewis in a statement.

It is not a given that the performance-restricted stock units will yield their promised payout. As the SEC explains, “PSUs vest only if pre-established three-year performance targets are achieved.”

But if Regeneron hits its goal of 65.6% growth over the next five years, the PSUs packages could be worth $196.5 million apiece in December 2028. If the company’s stock rises 140% over five years at an annual rate of 19.2%, the two execs’ PSUs would be both worth $713.3 million.

Schleifer and Yancopoulos will not be eligible for additional equity grants until December 2025. 

In its SEC proxy statement, Regeneron stresses how it closely aligns pay with its mission, strategy and business model. “Our compensation supports our core strategy to create and advance a high-quality, internally developed product pipeline. The pipeline is directly created by our talented employees, and their engagement and commitment are a key driver of pipeline success,” the document explains.

“The best place to read about our compensation philosophy is in our proxy statement, which has a great detail of information about our approach designed to align the long-term interests of all stakeholders, including employees, shareholders and patients who may benefit from our treatments,” said Alex Bowie, executive director, corporate communications at Regeneron.