Abbott brass takes pay cuts | Personnel Moves

The top brass at Abbott (NYSE:ABT) saw their 2011 pay packages reduced by a collective 23.9%, ranging from a 6.1% cut for chairman & CEO Miles White to a whopping 26.9% hit for pharma head Richard Gonzalez.

Most of the executives’ annual salaries rose modestly (by half a percent or less for all except Gonzalez, whose base pay rose 11.2%). The declines were mostly due to lower stock and options awards for the officers.

White earned a total of $24.0 million last year, including a $4.2 million bonus for spearheading the plan to split off Abbott’s research pharmaceuticals business. Gonzalez, who’ll be CEO of the as-yet-unnamed pharma spinout, earned $5.6 million in 2011, according to an SEC filing.

CFO Thomas Freyman took home $7.9 million, down 16.9% from 2010; general counsel and secretary Laura Schumacher pulled down $5.6 million, a 21.9% decline. Diagnostics chief Edward Michael pulled down $5.3 million, but wasn’t among the highest-paid execs in 2010, meaning his pay that year wasn’t reported.

Total compensation includes base salary, bonuses, and benefits, according to the filing.

In October, Abbott revealed its plan to split into a pair of separate, publicly traded firms, with White staying on to lead the Abbott medical device and nutritionals business and Gonzalez leaving with the pharma biz. The initial reaction on Wall Street was varied, with some analysts predicting a quick buyout for the new pharma unit but others doubting a suitor will emerge.

But ABT shares are up 12.7% since the deal was announced, rising from an Oct. 18 close of $52.44 to yesterday’s closing price of $59.11. Shares closed today at $59.43, up 0.5%.

Last year the stock posted its best annual return in half a decade, according to the filing, posting a 21.8 percent total shareholder return. In January Abbott reported record revenues of $10.38 billion for its 4th quarter, up 4.1% compared with Q4 2010 but lower than the $10.63 billion expected on The Street.

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