The strategy, detailed in an SEC filing last Friday, will base bonuses on various measures of pipeline output, ranging from the progression of drug candidates into Phase II trials to final regulatory approval.
Lilly spokesman Mark Taylor told in-PharmaTechnologist.com that: “The addition of a pipeline metric to Lilly's cash bonus program was done to emphasize the importance of delivering on our innovation-based strategy.”
“Depending on how the company does compared with [sales, EPS and now pipeline progress] goals that are set for each of these metrics, the cash bonus payout may be greater or less than target.”
Taylor went on to explain the scheme is available to most full-time Lilly employees worldwide, excluding those in certain regions who participate in other remuneration programmes.
He also denied that it is part of a response to the impending expiration of US patents for some of Lilly’s top selling products, including its best selling schizophrenia treatment Zyprexa.
“The change in the company's cash bonus program was not driven by the upcoming patent expiration of Zyprexa. Rather, it was done to focus increased attention on our top objective, speeding innovation.”
Lilly’s focus on "speeding innovation" is unsurprising given the number of late-stage pipeline setbacks the firm has encountered in recent months.
Last October, for example, the US Food and Drug Administration (FDA) asked for more data on the candidate diabetes treatment Bydureon that Lilly is developing in collaboration with Amlyin and Alkermes.
In December Lilly announced that it had halted a Phase III trial of its cancer drug tasisulam after concerns were raised about the development of blood clots by patients enrolled in the study.
And more bad news came last month with the US FDA rejected Lilly’s Alzheimer’s disease detection assay Amyvid and deemed that the risks of its candidate cystic fibrosis drug Solpura outweigh its benefits.