Pfizer CEO Albert Bourla sold almost $5.6 million worth of stock on Monday, the same day the drugmaker announced positive early data on its experimental coronavirus vaccine that sent shares soaring.
Shares of Pfizer jumped by almost 15% on Monday after the company and its partner BioNTech said its vaccine was more than 90% effective in preventing Covid-19 among those in the trial without evidence of prior infection.
Bourla sold 132,508 shares at an average price of $41.94 per share, or nearly $5.6 million, according to securities filing. The sale was part of a pre-scheduled 10b5-1 trading plan, which was adopted on Aug. 19, the filing shows, as the company was enrolling participants in its late-stage trial.
The sale accounted for 61.8% of the shares owned both directly and indirectly by Bourla. He still owns 81,812 both directly or indirectly, the filings show. Pfizer confirmed the sale in a statement and added that Bourla has a larger holding in the company through the company’s “qualified and nonqualified savings plans,” which likely means stock options.
“After being with the company for more than 25 years, Albert owns a substantial amount of Pfizer stock under our qualified and nonqualified savings plans,” a Pfizer spokesperson said in a statement. “He now holds approximately nine times his salary in Pfizer stock after the sale this week.”
According to the company’s 2019 proxy report, Bourla, who became CEO on Jan. 1, 2019, was being paid a base salary of $1.65 million starting April 1. Nine times that salary would be about $15 million worth of shares.
Baird biotech analyst Brian Skorney defended the sale on Twitter, saying that it “should be an example of capitalism at its best.”
“Less than a year from discovery of the virus to a highly effective vaccine,” Skorney said. “Albert should be rewarded. The benefits to society will be incalculable.”
Bourla is not the first pharmaceutical or biotech executive to cash in on his company’s stock gains during the pandemic. The top five executives at the biotech company Moderna, which has another Covid vaccine in development, have sold more than $80 million this year as the company’s stock shot up more than 300% since Jan. 1, Stat News reported earlier this year.
Jay Clayton, the chairman of the Securities and Exchange Commission, has cautioned executives against selling stock amid the volatility of the pandemic because it could create bad optics.
“If you are an executive of a public company in a time like this there may be idiosyncratic circumstances where you would be in the market, but, as we’ve said for a long time, in this volatile time, please practice good corporate hygiene,” he told CNBC in May. “Why would you want to even raise the question that you were doing something that was inappropriate?”
CNBC’s Meg Tirrell contributed to this report.