Elan boss waives $1m bonus and plumps for options on 73,874 shares

ELAN CHIEF executive Kelly Martin last month waived his $1 million cash bonus for 2007 in favour of the granting of options on 73,874 ordinary shares.

This is revealed in the pharmaceutical company's annual report, filed recently with the Securities and Exchange Commission in the US. Elan's main drug is Tysabri, which treats multiple sclerosis and Crohn's disease.

Mr Martin waived the bonus payment on February 14th. The shares have an exercise price of $25.01. "Mr Martin also received an annual stock option grant exercisable for 255,716 ordinary shares on the same date," the report states. "The options will vest at a rate of 25 per cent a year for four years and will expire 10 years from the date of grant."

Mr Martin waived his $880,000 bonus in 2006 in favour of options over 101,746 shares.

The annual report shows that Mr Martin's total remuneration in 2007 was $1.96 million, up from $1.79 million in the previous year.

His earnings last year included a basic salary of $805,677, a cash bonus of just more than $1 million, a pension of $6,750 and a benefit-in-kind payment of $107,263.

The accounts also show that Lars Ekman, a former executive vice-president at Elan, received a severance payment of $2.5 million from the company on his retirement at the end of December.

He was also given a cash payment of $605,000 in respect of "restricted stock units" which he held. Mr Ekman's total remuneration was $3.6 million for the year, up from $984,800 in 2006.

Chief financial officer Shane Cooke was paid $1.3 million last year, a rise of just under $100,000 on 2006. The Irishman was paid a basic salary of $594,922, and a bonus of $721,000.

Kyran McLaughlin, Elan's non-executive chairman and a senior director at Dublin-based stockbroker Davy, was paid $300,000 in fees, the same level as 2006.

Other directors based in Ireland received increases in total pay from Elan last year. Former AIB finance chief Gary Kennedy was paid $73,711, up from $67,500; CRH chairman Kieran McGowan earned $88,356, up from $87,500; and accountant Laurence Crowley received $75,908, compared with $67,500 in 2006.

The report shows that Elan's total debt stands at $1.76 billion. Elan shares closed in Dublin yesterday at €14.45, up 2.9 per cent. The company has a market value of €6.8 billion.