Cardinal Health disclosed pay and perks for other leaders and its median employee, as well as severance payouts for two former top executives.
Cardinal Health paid CEO Jason Hollar nearly $18.8 million in his first year on the job, the device manufacturer and pharmaceutical distrbutor said in a new executive pay disclosure.
That makes Hollar — who was Cardinal Health’s chief financial officer until his promotion in September 2022 — the second-highest-paid CEO among the world’s largest medical device manufacturers.
Abbott CEO Robert Ford is the top-paid CEO of all medical device manufacturers at $21.7 million in total compensation. Like Cardinal Health, Abbott also has a major pharmaceutical business, but Abbott does not disclose pay for Medical Devices EVP Lisa Earnhardt.
Hollar’s total compensation for fiscal 2023 (which ended June 30, 2023) included a $1.2 million salary, $14.8 million in stock awards and $2.4 million in cash paid under the non-equity incentive plan. The stock awards included nearly $3.2 million in performance stock units (PSUs) and restricted stock units (RSUs) related to his promotion to CEO.
Cardinal Health noted that the amounts it disclosed for executive stock awards (RSUs and PSUs) are accounting values, not actual amounts paid or realized. The actual values could end up much higher. For example, Hollar’s stock awards of $14.8 million would be worth nearly $21 million “assuming that the highest level of performance conditions will be achieved.”
Hollar also received $13,200 worth of company-paid 401(k) contributions, $7,221 for a home security system and personal liability insurance coverage, and personal use of company aircraft valued at $292,212.
As CFO, Hollar’s total compensation in fiscal 2022 was nearly $3.9 million.
Cardinal Health’s medical segment is the eighth-largest medical device manufacturer in the world, according to our latest Medtech Big 100 ranking by revenue.
Cardinal Health’s top-paid executives
Chief Financial Officer Aaron Alt is the second-highest-paid executive at Cardinal Health with $6 million in total compensation for fiscal 2023. He joined Cardinal Health on Feb. 10.
Alt’s pay package included $3.8 million worth of PSUs and RSUs, plus a $1 million cash sign-on bonus “to address compensation forfeited at his former employer,” foodservice distribution company Sysco Corp.
Alt was followed by Cardinal Health Medical CEO Stephen Mason at $4.42 million, Chief Legal and Compliance Officer Jessica Mayer at $4.40 million and Pharmaceutical CEO Deborah Weitzman at nearly $4.1 million.
Severance payouts for former Cardinal Health executives
Two former executives also made the top-paid list even though they were involuntarily terminated without cause just a few months into fiscal 2023.
Cardinal Health disclosed $4.8 million in compensation to former Pharmaceutical CEO Victor Crawford (who left the company on Nov. 11, 2022) and $3.5 million for former Cardinal Health CEO Michael Kaufmann, who left the company on Sept. 1, 2022.
Kaufmann made nearly $13.5 million in fiscal 2022, his final full year at the helm. Crawford made $3.8 million in fiscal 2022.
The pay disclosure said Kaufmann was entitled to a $6.75 million cash severance payment, plus a $419,425 pro-rated cash performance bonus and nearly $17.8 million worth of long-term incentive awards. The filing also disclosed severance benefits worth nearly $3.2 million for Kaufmann and a $100,000 contribution from the Cardinal Health Foundation to an Ohio State University scholarship “[honoring] Kaufmann’s decades of service to the company and his commitment to” diversity, equity and inclusion.
Cardinal Health estimated Crawford’s severance entitlement at $2.2 million in cash severance, $345,229 for a pro-rated cash performance bonus, and nearly $5.6 million worth of long-term incentive awards.
Cardinal Health’s median employee wage
The U.S. Securities and Exchange Commission requires publicly traded companies like Cardinal Health to calculate the gap between CEO compensation and pay for its median employee.
Cardinal Health used the same median employee for the last three years, describing that as a full-time, non-exempt employee in the U.S. who made $69,024 in fiscal 2023.
That means that Hollar’s compensation was 269 times greater than what Cardinal Health’s median employee received, the company said.
The year before, Cardinal Health reported paying that median employee $63,906 and $48,291 the year before that.