By Toby Sterling
AMSTERDAM (Reuters) – Mylan NV shareholders voted against the generic drugmaker’s executive pay policy but re-elected the board at its annual meeting on Thursday despite a shareholder campaign in the wake of a scandal over high prices for its EpiPen emergency allergy treatment.
The company did not disclose the vote totals for the directors. Investors agitating against Mylan’s board had a steep threshold to cross as more than two-thirds of the shares voted, as well as more than half of Mylan’s outstanding shares, were needed for the directors to lose.
New York City Comptroller Scott Stringer, who oversees the city’s pensions and is one of the leaders of the campaign against the drugmaker’s board, said the failure to disclose the vote totals suggests that the directors face strong opposition.
“This company massively hiked prices on life-saving drugs, allegedly overcharged the government for its products, allowed excessive executive pay to go unchecked — all ultimately fundamental failures of board oversight,” Stringer said.
Mylan said in response that it has always reported the vote totals in a filing with regulators after its meeting.
The failed measure to approve the company’s executive compensation was a non-binding advisory vote. Mylan has said it will take into account the outcome of this vote when considering future compensation arrangements.
BlackRock, Mylan’s third-largest shareholder with more than 5 percent of the company’s shares, said it had voted against four of the drugmaker’s directors as well as its executive pay.
“We continue to have concerns about excessive pay relative to peers and performance, leadership structure, succession planning, and board responsiveness to shareholder feedback on other issues,” the asset manager said.
The shareholder campaign against Mylan’s board, led by New York City and State pension funds as well as the California teachers pension fund, picked up steam after Chairman Robert Coury’s nearly $100 million pay package was disclosed earlier this year.
The annual meeting was held in Amsterdam, where the company has been headquartered since 2015. It was sparsely attended, with around the same number of attendees from the company as those in the audience.
The only shareholder to speak was Quirijn Bongaerts of the Dutch small shareholders association VEB. He challenged Coury on executive pay, ethics and the appointment of board members.
The New York City and State pension funds and the California State Teachers’ Retirement System, as well as influential proxy advisory firm ISS, had urged shareholders to vote against the directors to voice their dissatisfaction.
ISS said earlier this month that shareholder value had eroded as the board mismanaged the EpiPen issue. Sharp price increases for the life-saving treatment spurred congressional, Justice Department and other government investigations of Medicaid overcharging.
Mylan shares were up 74 cents, or 1.9 percent, at $39.01 in afternoon trading on Nasdaq.
(Reporting by Michael Erman in New York; Editing by Chizu Nomiyama)