The Stunning Golden Parachutes of Juno’s $9B Celgene Deal

When Gilead Sciences snapped up Kite Pharmaceuticals five months ago, Kite’s Chief Executive Officer Arie Belldegrun snagged a nice payday of $694 million. Now another CEO is enjoying the fruits of having his company acquired. Juno’s Hans Bishop will take home $287 million after Celgene acquired his company.

An Endpoints News analysis of filings with the U.S. Securities and Exchange Commission reveals how Juno’s top brass made out following last month’s $9 billion acquisition of the CAR-T and T cell receptor (TCR) therapies.

In its analysis, Endpoints said Bishop’s total payday from the deal includes $205 million worth of company stock plus “an additional set of vested and unvested options registering $68 million and another $8.6 million in restricted shares.” Additionally, Bishop will take home $2.6 million in two-years-worth of salary. Lastly, Bishop will have an additional $3.4 million in covered COBRA expenses as well as what Endpoints called “his golden parachute taxes.”

Juno’s Chief Financial Officer Steve Harr secured about $93 million from the deal. That includes stock worth about $56.5 million plus another $29 million in options. He also has about $7.4 million from restricted shares, the analysis shows.

Juno’s general counsel Bernard Cassidy will take home about $27 million from his shares of stock and Sunil Agarwal, Juno’s head of research and development, will take home about $20 million. Agarwal joined Juno from Genentech in April 2017 – which means the payout he takes home amounts to about $2 million per month.

Another big winner, and by the numbers perhaps the biggest winner, is Robert Nelsen. Not only is Nelsen a member of the company board of directors, he is also a Managing Director of Arch Ventures, a VC firm that owns $922,479,618 worth of stock in Juno, Endpoints reported.  Arch, as John Carroll writes, will now be able to take that nearly $1 billion gain and turn it into seed funding and early financing of other companies.

“Arch went into the Juno deal thinking big. And they won big,” Carroll wrote.

Celgene’s acquisition of Juno was not out of the blue. The two companies have a partnership dating back more than two years. With Juno coming under the Celgene umbrella, that will bring Juno’s JCAR017 CAR-T therapy targeting relapsed and/or refractory diffuse large B-cell lymphoma (DLBCL) to its pipeline. JCAR017 is a CD19-directed CAR T cell product. The therapy received breakthrough therapy designation from the FDA. The addition of the potential gene therapy could help offset some of the losses the company faces due to expiring patents for blood cancer drug Revlimid. At the time the deal was announced, Mark  Alles, Celgene’s CEO, said that acquisition of Juno’s cellular immunotherapy portfolio and R&D programs will strengthen Celgene’s “global leadership in hematology and adds new drivers for growth beyond 2020.”

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