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Joseph Papa's pay jump was driven by stock and option awards worth nearly US$12.3-million.

CHRISTINNE MUSCHI

Bausch Health Cos. Inc. – once known as Valeant Pharmaceuticals – paid chief executive officer Joseph Papa US$17.14-million in 2019, up from US$14.74-million the year before.

The pay jump was driven by stock and option awards worth nearly US$12.3-million. Those awards can ultimately pay Mr. Papa more – or less – depending on how the company’s shares perform.

Stock-based pay has been a big part of executive compensation for Bausch, which hired Mr. Papa in 2016 to turn the company around. At one point, Valeant, based in Laval, Que., was the most valuable company on the Toronto Stock Exchange under former CEO Michael Pearson. But investors soured on the company’s debt-heavy, growth-through-acquisition model.

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Mr. Papa, based in New Jersey, received a stock-heavy pay package valued at US$62.7-million when he first arrived in 2016 to turn the company around. Bausch restructured Mr. Papa’s compensation in 2018 by wiping out awards that were initially valued at nearly US$30-million, but were then worth less because the company’s stock price had lagged since Mr. Papa’s arrival.

In 2019, Bausch said, it delivered on its “pivot to offence” strategy, with its first full year of reported revenue growth since 2015, the repayment of about US$900-million of debt using cash generated from operations, and a 14-per-cent increase in research and development spending. Bausch shares rose by almost 54 per cent in 2019.

The company beat its internal revenue goal by 1 per cent and its profit goal by 5 per cent, but paid its executives 144 per cent of their target bonuses. Mr. Papa received a cash bonus of US$3.24-million.

With the recent market turmoil, Bausch’s stock price now sits at half of where it closed in 2019 – and down 55 per cent from Mr. Papa’s arrival.

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