Noseworthy nominated to major pharmaceutical board
KENILWORTH, N.J. — Mayo Clinic President and CEO John Noseworthy has been nominated to serve on the board of directors for one of the world's largest pharmaceutical companies.
Merck announced Noseworthy's nomination Monday to replace C. Robert Kidder, an investment executive who is retiring after serving in that capacity since 2005. Noseworthy's nomination will be voted on May 23 at Merck's annual meeting of shareholders.
"In this role, he will help share the voice of the patient through meaningful dialogue with industry leaders who are focused on finding transformative new medicines and vaccines," said Mayo Clinic spokesman Karl Oestreich. "This new role will provide Mayo Clinic with another lens into a highly complex health care marketplace and help anticipate major trends in the pharmaceutical industry that may affect patients."
Merck was formed in 1891 and is the 93rd largest company in the world, according to Forbes Magazine. It was valued at $157.2 billion in 2016 when it had nearly $39 billion in sales, Forbes says. According to Merck's press release, it operates in 140 countries to "deliver innovative health solutions," such as prescription medicines, vaccines, biological therapies and animal health products.
Noseworthy would join a group of 12 others who boast impressive credentials, including Paul Rothman, CEO of Johns Hopkins Medicine and dean of Johns Hopkins University.
Noseworthy has served as Mayo's president and CEO since 2009, guiding Minnesota's largest private employer to numerous awards and recognitions in the health care field. He's been personally honored by Modern Healthcare Magazine five times as one of 50 Most Influential Physician Executives while pushing the $6.5 billion Destination Medical Center forward to transform Rochester.
Though he's a health governor of the World Economic Forum , Noseworthy dropped 22 spots to No. 30 in that magazine's 2016 list of "100 Most Influential People in Healthcare ." He's met twice with Donald Trump since the Nov. 7 presidential election while the national health care debate has ratcheted up.
"We are pleased to nominate Dr. John Noseworthy to stand for election to the Merck board and look forward to benefiting from his firsthand insights about patient care and health care delivery as a leader of one of the largest non-profit health systems in the United States," said Kenneth C. Frazier, Merck's chairman and CEO, who earned $24 million in 2015, according to SEC filings.
Oestreich said Merck is one of many pharmaceutical companies that sponsors medical research at Mayo Clinic. However, Noseworthy's pending appointment won't impact those existing relationships due to "conflict of interest measures that Mayo Clinic puts in place," Oestreich said.
If confirmed next month, Noseworthy would receive a base compensation of $110,000 with the potential to earn $170,000 per year in deferred stock, according to Merck's recent SEC filings. He could earn more by serving on a board committee. Mayo paid him $2.3 million in 2014 .
Kidder, the man Noseworthy would replace, was paid $290,000 in 2016, which made him one of the lowest paid members of the board; nine of the 13 made more than $300,000 last year. Kidder also received more than 10,000 shares of Merck stock during his 12-year term on the board of directors. Those shares are currently valued at about $625,000.
The directors are expected to attend regular board meetings, committee meetings and annual shareholder meetings. The board is split into four committees that have the following functions: auditing, compensation and benefits, governance, and research.
According to SEC filing, the board met eight times in 2016 and all directors attended at least 75 percent of board and committee meetings.