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Print Edition StoriesWednesday, October 21, 2009
Sepracor buyout completed; CEO Adams to receive up to $11M
By Craig M. Douglas
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Japanese pharmaceutical giant Dainippon Sumitomo Pharma Co. has completed its $2.6 billion acquisition of Sepracor Inc., triggering change-in-control provisions at the local drug maker that could deliver roughly $11 million in pay and benefits to CEO Adrian Adams.
According to an April 3 regulatory filing by Marlborough-based Sepracor, Adams stands to receive a $5.6 million severance payment and another $302,892 to cover such personal expenditures as life insurance premiums, automobile expenses, a housing allowance and a medical-insurance opt-out payment. Another $4.2 million in restricted stock also is scheduled to vest, now that a change in control has occurred. The value of those vested shares is based on Dainippon Sumitomo Pharma’s $23-per-share acquisition price.
Adams also is set to receive $867,790 in tax gross-up payments to help cover the tax liabilities stemming from his change-in-control compensation.
The payment and stock-vesting only go into effect if Adams remains with the company after the change-in-control occurs. The deal officially closed Oct. 20.
Adams, who was 58 as of Sepracor’s April filing, has been the company’s CEO and president since 2007.
According to a September announcement from the two companies, Sepracor will be run as a subsidiary of Dainippon Sumitomo, keeping its headquarters in Marlborough and its name and branding. So one of its most popular drugs, the sleep aid Lunesta, will continue to be sold as a Sepracor (Nasdaq: SEPR) product, along with its asthma treatment Xopenex and other drugs.
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