☐ | Preliminary Proxy Statement |
☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
☒ | Definitive Proxy Statement |
☐ | Definitive Additional Materials |
☐ | Soliciting Material under §240.14a-12 |
☒ | No fee |
☐ | Fee paid previously with preliminary |
☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and0-11. |
1165 Eastlake Avenue East
Seattle, Washington 98109
April 22, 202226, 2024
Dear Adaptive Biotechnologies Corporation Shareholder:
You are cordially invited to the Adaptive Biotechnologies Corporation 2024 Annual Meeting of Shareholders (the “Annual Meeting”). The attached proxy is solicited on behalf of the board of directors of Adaptive Biotechnologies Corporation for use at the Annual Meeting to be held on Friday, June 10, 2022,7, 2024, at 9:00 a.m., Pacific Time, or at any adjournment or postponement thereof, for the purposes set forth in the accompanying proxy statement, Notice of Annual Meeting of Shareholders (the “Notice”) and form of proxy. The Annual Meeting will be held entirely via the Internet, broadcast from our corporate headquarters at 1165 Eastlake Avenue East, Seattle, Washington 98109.
To be admitted to the Annual Meeting, you must register prior to Wednesday, June 8, 2022,5, 2024, at 2:00 p.m., Pacific Time at www.proxydocs.com/ADPT and enter the control number found on your proxy card, voting instruction form or Notice of Internet Availability of Proxy Materials you previously received. You may attend the meeting, vote your shares and submit questions electronically during the meeting via live webcast by registering at www.proxydocs.com/ADPT. You must also follow subsequent instructions you may receive by electronic mail thereafter. You may vote during the Annual Meeting by following the instructions available on the meeting access email. At the Annual Meeting, you will be asked to elect threetwo Class IIIII directors to our board of directors, to approve, on an advisory basis, the 20212023 compensation of our named executive officers and to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2022.2024. The accompanying Notice describesproxy materials describe these matters.
We have elected to provide access to our proxy materials on the Internet under the Securities and Exchange Commission’s “notice and access” rules. Our proxy materials are available at www.proxydocs.com/ADPT. We are mailing a Notice of Internet Availability of Proxy Materials on or about April 22, 2022,26, 2024, which provides instructions on how to access our proxy materials and our 20212023 Annual Report on the Internet. Please read our proxy materials and our 20212023 Annual Report carefully before submitting your proxy.
It is important that your shares are represented and voted at the Annual Meeting. You may vote on the Internet or by telephone as instructed in the Notice of Internet Availability of Proxy Materials or, if you are receiving a paper copy of the proxy materials, complete, sign and date the enclosed proxy card and return it in the enclosed envelope as soon as possible.
We thank you for your support and participation.
Sincerely,
Chad Robins
Chairman, Co-Founder and Chief Executive Officer
1165 Eastlake Avenue East
Seattle, Washington 98109
NOTICE OF 20222024 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JUNE 10, 20227, 2024
To the Shareholders of Adaptive Biotechnologies Corporation:
The attached proxy is solicited on behalf of the board of directors of Adaptive Biotechnologies Corporation for use at the Annual Meeting of Shareholders to be held on June 10, 2022,7, 2024, at 9:00 a.m., Pacific Time (the “Annual Meeting”), or at any adjournment or postponement thereof, for the purposes set forth below and in the accompanying proxy statement. The Annual Meeting will be held entirely via the Internet. Shareholders may participate in the Annual Meeting by registering at the following website: www.proxydocs.com/ADPT. You will need the control number included on your Notice of Internet Availability of Proxy Materials, your proxy card or the instructions that accompanied your proxy materials for the following purposes:
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| Proposal 1: To elect |
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| Proposal 2: To approve, on a non-binding advisory basis, the compensation of our named executive officers as described in the proxy statement; |
| 3. |
| Proposal 3: To ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, |
4. | To conduct any other business properly brought before the meeting or any adjournments thereof. |
We know of no other matters to come before the Annual Meeting. Only shareholders of record of our common stock at the close of business on April 14, 202210, 2024 are entitled to notice of and to vote at the Annual Meeting or at any postponements or adjournments thereof. For ten days prior to the meeting, a complete list of the shareholders entitled to vote at the meeting will be available for examination by any shareholder for any purpose germane to the meeting during ordinary business hours at our executive offices located at 1165 Eastlake Avenue East, Seattle, Washington 98109.
YOUR VOTE IS IMPORTANT. PLEASE VOTE YOUR SHARES VIA THE INTERNET, THROUGH OUR TOLL-FREE TELEPHONE NUMBER (866-390-5390) OR BY SIGNING, DATING AND PROMPTLY RETURNING YOUR COMPLETED PROXY CARD. IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 10, 2022:7, 2024: THIS PROXY STATEMENT, THE NOTICE OF ANNUAL MEETING OF SHAREHOLDERS AND THE ANNUAL REPORT ARE AVAILABLE AT WWW.PROXYDOCS.COM/ADPT.
By order of the board of directors,
Stacy Taylor
Senior Vice President, General Counsel and Corporate Secretary
April 22, 202226, 2024
Table of Contents
TABLE OF CONTENTS
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Policies and Procedures for Review, Approval or Ratification of Transactions with Related Persons |
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PROXY STATEMENT
INFORMATION CONCERNING VOTING AND SOLICITATION
Your proxy is solicited on behalf of the board of directors of Adaptive Biotechnologies Corporation (“Adaptive,” the “Company,” “we,” “us” or “our”), a Washington corporation, for use at our 20222024 Annual Meeting of Shareholders (the “Annual Meeting”) to be held on Friday, June 10, 2022,7, 2024, at 9:00 a.m., Pacific Time, or at any continuation, postponement or adjournment thereof, for the purposes discussed in this proxy statement, as well as any business properly brought before the Annual Meeting. Proxies are solicited to give all shareholders of record an opportunity to vote on matters properly presented at the Annual Meeting. The Annual Meeting will be held entirely via the Internet. To be admitted to and participate in the Annual Meeting, you must register prior to Wednesday, June 8, 2022,5, 2024, 2:00 p.m., Pacific Time at www.proxydocs.com/ADPT and enter the control number found on your proxy card, voting instruction form or Notice of Internet Availability of Proxy Materials you previously received. Upon completing your registration, you will receive further instructions via email one hour prior to the start of the Annual Meeting, including your unique link that will allow you access to the Annual Meeting. You will have the ability to submit questions prior to and during the Annual Meeting. Please be sure to follow instructions found on your proxy card and/or Voting Authorization Form and subsequent instructions that will be delivered to you via email.
Technical assistance will be available one hour prior to and during the Annual Meeting. Information related to technical assistance will be provided in the email with the sign-in instructions. We recommend that you log in at least 15 minutes before the Annual Meeting to ensure you are logged in when the Annual Meeting starts. You may vote during the Annual Meeting by following the instructions available on the meeting access email.
We have elected to provide access to our proxy materials over the Internet. Accordingly, on or about April 22, 2022,26, 2024, we are mailing a Notice of Internet Availability of Proxy Materials to most of our shareholders of record and we are mailing paper copies of the proxy materials to certain other shareholders of record. All shareholders will have the ability to access the proxy materials on the website referred to in the notice or request to receive a printed set of the proxy materials. You can find instructions on how to request a printed copy by mail or electronically on the notice and on the website referred to in the notice, including an option to request paper copies on an ongoing basis. On April 22, 2022,26, 2024, we intend to make this proxy statement available on the Internet and to commence mailing of the Notice of Internet Availability of Proxy Materials to all shareholders entitled to vote at the Annual Meeting. We intend to mail this proxy statement, together with a proxy card, to those shareholders entitled to vote at the Annual Meeting who have properly requested paper copies of such materials, within three business days of such request.
Availability of Proxy Materials for the 20222024 Annual Meeting
This proxy statement and our 20212023 Annual Report are available at www.proxydocs.com/ADPT. This website address contains: the Notice of Annual Meeting of Shareholders, the proxy statement and proxy card sample and the 20212023 Annual Report. You are encouraged to access and review all of the important information contained in the proxy materials before voting.
Who Can Vote, Outstanding Shares
Record holders of our common stock as of the close of business on April 14, 2022,10, 2024, the record date for the Annual Meeting (the “Record Date”), are entitled to vote at the Annual Meeting on all matters to be voted upon. As of the Record Date, there were 142,222,679147,368,324 shares of our common stock outstanding. On each matter presented to our shareholders for vote, the holders of common stock are entitled to one vote per share held as of the Record Date.
You may vote by attending the Annual Meeting and voting via the Internet, via our toll-free telephone number at 866-390-5390 or by submitting a proxy. The method of voting by proxy differs (1) depending on
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whether you are viewing this proxy statement on the Internet or receiving a paper copy and (2) for shares held as a record holder and shares held in “street name.” If you are a shareholder of record on the Record Date, you can participate in the Annual Meeting online at www.proxydocs.com/ADPT and vote your shares during the Annual Meeting.
Record Holder. If you hold your shares of common stock as a record holder and you are viewing this proxy statement on the Internet, you may vote by submitting a proxy over the Internet by following the instructions on the website referred to in the Notice of Internet Availability of Proxy Materials previously mailed to you. If you hold your shares of common stock as a record holder and you are reviewing a paper copy of this proxy statement, you may vote your shares by completing, dating and signing the proxy card that was included with the proxy statement and promptly returning it in the preaddressed, postage-paid envelope provided to you, or by submitting a proxy over the Internet or by telephone by following the instructions on the proxy card.
Hold in Street Name.If you hold your shares of common stock in street name, which means your shares are held of record by a broker, bank or other nominee, you will receive a notice from your broker, bank or other nominee that includes instructions on how to vote your shares. Your broker, bank or other nominee will allow you to deliver your voting instructions over the Internet and may also permit you to vote by telephone. In addition, you may request paper copies of the proxy statement and proxy card from your broker by following the instructions on the notice provided by your broker.
General. If you vote through these facilities, you should be aware that you may incur costs such as usage charges from telephone companies or Internet service providers and that these costs must be borne by you. If you vote through these facilities, then you need not return a written proxy card by mail. The cost of soliciting proxies will be borne by us. We may reimburse banks and brokers and other persons representing beneficial owners for their reasonable out-of-pocket costs. We may use the services of our officers, directors and others to solicit proxies, personally or by telephone, facsimile or electronic mail, without additional compensation.
YOUR VOTE IS VERY IMPORTANT.IMPORTANT. You should submit your proxy even if you plan to attend the Annual Meeting via the Internet. If you are a shareholder of record on the Record Date, you can participate in the Annual Meeting online at www.proxydocs.com/ADPT and vote your shares during the Annual Meeting. If you properly give your proxy and submit it to us in time to vote, one of the individuals named as your proxy will vote your shares as you have directed.
All shares entitled to vote and represented by properly submitted proxies (including those submitted electronically, telephonically and in writing), and not revoked or superseded, will be voted at the Annual Meeting in accordance with the instructions indicated on those proxies. If no direction is indicated on a proxy, your shares will be voted as follows:
FOR each of the threetwo Class IIIII nominees for director named in this proxy statement;
FOR the compensation of our named executive officers, on an advisory basis (“Say-on-Pay”); and
FOR the ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm.
The proxy gives each of Chad Robins, Kyle Piskel and Stacy Taylor discretionary authority to vote your shares in accordance with their best judgment with respect to all additional matters that might come before the Annual Meeting. If you receive more than one proxy card or Notice of Internet Availability of Proxy Materials, it means you hold shares that are registered in more than one account. To ensure that all of your shares are voted, sign and return each proxy card or, if you submit a proxy by telephone or the Internet, submit one proxy for each proxy card or Notice of Internet Availability of Proxy Materials you receive.
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Revocation of Proxy
If you are a shareholder of record, you may revoke your proxy at any time before your proxy is voted at the Annual Meeting by taking any of the following actions:
delivering to our Corporate Secretary a signed written notice of revocation, bearing a date later than the date of the proxy, stating that the proxy is revoked;
signing and delivering a new paper proxy relating to the same shares and bearing a later date than the original proxy;
submitting another proxy by telephone or over the Internet (your latest telephone or Internet voting instructions will be followed); or
attending the Annual Meeting online and voting via the Internet, although attendance at the Annual Meeting will not, by itself, revoke a proxy.
Written notices of revocation and other communications with respect to the revocation of Company proxies should be addressed to:
Adaptive Biotechnologies Corporation
1165 Eastlake Avenue East
Seattle, WA 98109
Attention: SVP, General Counsel and Corporate Secretary
If your shares are held in “street name,” you may change your vote by submitting new voting instructions to your broker, bank or other nominee. You must contact your broker, bank or other nominee to find out how to do so. See below regarding how to vote live if your shares are held in street name.
Attendance at the Annual Meeting
We are excited to once again hold a virtual-only meeting. Based on our experience in prior years, this format provides broad shareholder access to our meeting, allowing all shareholders with Internet connectivity to have a consistent experience regardless of location, ability to travel or similar factors, while saving us and our shareholders time and travel expenses, and, importantly, reducing our environmental impact. We have paid special attention to the meeting platform features, which provide shareholders the opportunity to vote, ask questions and otherwise participate in the meeting in a manner similar to – to—and in some ways superior to –to— traditional in-person shareholder meetings, and have found it also reduces costs. The format is particularly useful when practical limitations on in-person interaction limit shareholder engagement and participation, which we encourage.
participation.
If you are the record holder of your shares, you may attend the meeting by registering at the following website: www.proxydocs.com/ADPT. To participate in the Annual Meeting, you will need the control number included on the Notice of Internet Availability of Proxy Materials, your proxy card or the instructions that accompanied your proxy materials. We refer to attending the meeting through this website as attendance “via Internet,” and it is considered the same as attendance in person for all corporate purposes.
If your shares are held in “street name,” in the name of a broker, trustee or other nominee, you may change your vote by submitting new voting instructions to your broker, trustee or other nominee, or, if you have obtained a legal proxy from your broker or other nominee giving you the right to vote your shares, by attending the meeting and voting via the Internet.
Brokers or other nominees who hold shares of common stock in “street name” for a beneficial owner of those shares typically have the authority to vote in their discretion on “routine” proposals when they have not received instructions from beneficial owners.
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However, brokers are not allowed to exercise their voting discretion with respect to the election of directors or for the approval of other matters that are considered “non-routine” matters without specific voting instructions from the beneficial owner. These non-voted shares are referred to as “broker non-votes.” If your broker holds your common stock in “street name,” your broker will vote your shares on “non-routine” proposals only if you provide instructions on how to vote by filling out the voter instruction form sent to you by your broker with this proxy statement.
Only Proposal No. 3 (ratifying the appointment of our independent registered public accounting firm) is considered a routine matter. Proposals No. 1 (election of directors) and No. 2 (Say-on-Pay) are not considered routine matters, and without your instruction, your broker cannot vote your shares for those proposals.
The inspector of elections appointed for the Annual Meeting will tabulate votes cast by proxy or live via Internet at the Annual Meeting. The inspector of elections will also determine whether a quorum is present. In order to constitute a quorum for the conduct of business at the Annual Meeting, a majority of the votes entitled to be cast must be represented in person (via Internet) or by proxy at the Annual Meeting. Shares that abstain from voting on any proposal, or that are represented by broker non-votes, will be treated as shares that are present and entitled to vote at the Annual Meeting for purposes of determining whether a quorum is present.
Proposal No. 1: 1: Election of Directors.Directors. A plurality of the votes cast in the election of directors at the Annual Meeting is required for the election of directors. Accordingly, the threetwo Class IIIII director nominees receiving the highest number of votes will be elected. Abstentions, “withhold” votes and broker non-votes will have no effect on the outcome of the election of directors. Shareholders are not permitted to cumulate votes with respect to the election of directors.
Proposal No. 2:2: Say-on-Pay Vote. We will consider the advisory approval of the compensation of our named executive officers to have been obtained if the number of votes cast for the proposal at the Annual Meeting exceeds the number of votes against the proposal. Because abstentions and brokernon-votes are neither votes for or against the proposal, they will have no effect on the outcome of the vote. This vote is advisory and not binding on us, our board of directors or our compensation and human capital committee.
Proposal No. 3: 3:Ratification of Independent Registered Public Accounting Firm.Firm. The number of votes for must exceed the number of votes against in order to ratify the selection of Ernst & Young LLP as our independent registered public accounting firm. Abstentions are considered to be votes not cast on this proposal and thus will have no effect. Brokers generally have discretionary authority to vote on the ratification of our independent registered public accounting firm, thus broker non-votes are not expected to result from the vote on Proposal No. 3.
In their discretion, the proxy holders named in the proxy are authorized to vote on any other matters that may properly come before the Annual Meeting and at any continuation, postponement or adjournment thereof. The board of directors knows of no other items of business that will be presented for consideration at the Annual Meeting other than those described in this proxy statement. In addition, no shareholder proposal or nomination was received on a timely basis, so no such matters may be brought to a vote at the Annual Meeting.
Our board of directors is soliciting proxies for the Annual Meeting from our shareholders. We will bear the entire cost of soliciting proxies from our shareholders. In addition to the solicitation of proxies by delivery of the Notice of Internet Availability of Proxy Materials or proxy statement by mail, we will request that brokers, banks and other nominees that hold shares of our common stock, which are beneficially owned by our shareholders, send Notices of Internet Availability of Proxy Materials, proxies and proxy materials to those beneficial owners
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and secure those beneficial owners’ voting instructions. We will reimburse those record holders for their reasonable expenses. We do not intend to hire a proxy solicitor to assist in the solicitation of proxies. We may use several of our regular employees, who will not be specially compensated, to solicit proxies from our shareholders, either personally or by telephone, Internet, facsimile or special delivery letter.
Communicating with our Board of Directors
Shareholders who wish to communicate with our board of directors or specific individual directors may do so by letter sent to our principal executive offices, addressed to the attention of our Corporate Secretary. Our Corporate Secretary reviews all communications and forwards them to the intended recipient(s) consistent with a screening policy, which provides that sales materials, routine items and items unrelated to the duties and responsibilities of the board of directors are not relayed to directors.
Shareholder Recommendations for Director Nominees
In evaluating potential director nominees, our nominating and corporate governance committee will consider director candidates recommended by our shareholders, provided such recommendations are validly made by our shareholders pursuant to Rule 14a-8 under the Securities Exchange Act of 1934 (the “Exchange Act”) and our Bylaws. Shareholders who wish to recommend a candidate to our nominating and corporate governance committee for consideration for nomination should send to us, at our principal executive offices, information regarding the candidate.
A list of shareholders eligible to vote at the Annual Meeting will be available for inspection, for any purpose germane to the Annual Meeting, at our principal executive offices during regular business hours for a period of no less than ten days prior to the Annual Meeting. Information required to gain access to the list of shareholders eligible will also be provided upon request during the same time period.
This proxy statement contains “forward-looking statements” (as defined in the Private Securities Litigation Reform Act of 1995). These statements are based on our current expectations and involve risks and uncertainties, which may cause results to differ materially from those set forth in the statements. The forward-looking statements may include statements regarding actions to be taken by us. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law. Forward-looking statements should be evaluated together with the many uncertainties that affect our business, particularly those mentioned in the risk factors in
Item 1A of our Annual Report on Form 10-K for the year ended December 31, 20212023, and our periodic reports on Form 10-Q as well as our current reports on Form 8-K.
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2023 COMPANY HIGHLIGHTS
Selected 2023 Corporate Performance Highlights
Summary of Performance
In 2023, we continued to pursue our business around two main areas: clinical assessment of minimal residual disease (“MRD”) in lymphoid malignancies and immune medicine (“IM”)-driven drug discovery and development.
Our boardrevenue in 2023 was $170.3 million compared to $185.3 million in 2022, with the reduction being accounted for in large part by a decline in the amortization of directors consiststhe upfront payment made in 2019 by our cell therapy partner, Genentech, Inc. (“Genentech”), a slowdown in pharma services largely due to broader macroeconomic factors impacting the biopharmaceutical industry and no MRD milestones.
At the same time, our operating expenses were significantly leveraged as a result of eight members. Our directors hold office until their successors have been electedcontinued streamlining of our operations during the year. Operating expenses were $397.3 million during 2023, of which $25.4 million represented non-cash impairment charges, as compared to $385.5 million during 2022. As of December 31, 2023, cash, cash equivalents and qualified or untilmarketable securities was $346.4 million. We estimate positive adjusted EBITDA for the earlier of their resignation or removal. Our Articles of Incorporation and Bylaws provide that our directors may only be removed for cause and then onlyMRD business by the holdersend of 2025, and cash flow breakeven by the shares entitledend of 2026.1
Selected 2023 Results
MRD Highlights
We grew clonoSEQ test volume by 53% year over year. Clinical test revenue increased by 53% over 2022. Payor coverage for the test has grown to elect300 million lives in B cell acute lymphoblastic leukemia and multiple myeloma, 200 million lives in chronic lymphocytic leukemia and 70 million lives in diffuse large B cell lymphoma. United States average selling prices for the director or directors whose removal is sought if,test also increased by 13% quarter-over-quarter in the fourth quarter of 2023.
We integrated the clonoSEQ clinical diagnostic test via the Epic System Corporation’s (“Epic”) comprehensive electronic medical record (“EMR”) system into the records systems of four accounts in 2023 to enable easier test ordering, with a fifth account nearing launch. We will be focused on account-by-account implementation through 2024 and expect to have Epic EMR integrated with 15 to 20 accounts by year end. Additional accounts will be integrated with the Flatiron Health, Inc. EMR system in 2024, as well.
Our MRD Pharma revenue, excluding milestones, increased by 1% from 2022, attributable primarily to the slowdown in pharma services due to broader macroeconomic factors impacting the biopharmaceutical industry. Nevertheless, as of December 31, 2023, our clonoSEQ assay was being used in 143 active trials being conducted by 43 biopharmaceutical partners, including 75 trials in which it represents a clinical endpoint (primary endpoint in 10 trials).
IM Highlights
In IM drug discovery, we made significant advances in connection with our worldwide collaboration and license agreement with Genentech with respect to both the shared and personalized products. For the shared product, we completed an assessment of efficacy and safety data which enabled selection of a particular director,T cell receptor (“TCR”) candidate to progress as a potential therapeutic product candidate for which investigational new drug clearance was obtained in 2023. In addition, fully characterized TCR data packages against validated neoantigen targets have also been provided to Genentech for consideration.
| 1 | Adjusted EBITDA is a non-GAAP financial measure that we define as net loss attributable to Adaptive Biotechnologies Corporation adjusted for interest and other income, net, interest expense, income tax (expense) benefit, depreciation and amortization expense, impairment costs for right-of-use and related long-lived assets, restructuring expense and share-based compensation expense. |
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For the numberpersonalized product, blood samples from 165 cancer patients have been screened. Proof of votes castconcept for a personalized product has been completed by identifying and characterizing patient specific TCRs to unique tumor mutations. In 2023, we successfully built our personalized process workflow in favor of removing such director (orour South San Francisco lab under regulated conditions, which will enable us to complete end-to-end testing. This defines the entire board of directors) exceeds the number of votes cast against removal, and that any vacancy on our board of directors, including a vacancy resulting from an enlargementfoundation for future clinical readiness of our board of directors, may be filled only by the affirmative vote offully personalized process.
Focusing on autoimmune disease, we continued our drug discovery efforts in conditions such as multiple sclerosis (“MS”), Crohn’s disease, type 1 diabetes and rheumatoid arthritis, and discovered a majority of our directors thennovel therapeutic target in office.
Our board of directors has determined that all members of our board of directors, except Chad Robins, are independent directors for purposesMS. Validation of the rulesdiscovered self-antigen as a therapeutic target in MS and assessment of Nasdaqtherapeutic modalities against it is planned to occur over the next few years.
Selected Environmental and the Securities and Exchange Commission (“SEC”). In making this determination, our board of directors considered the relationships that each non-employee director has with us and all other facts and circumstances that our board of directors deemed relevant, including the beneficial ownership of our common stock by each non-employee director. The composition and functioning of our board of directors and each of our committees complies with all applicable requirements of Nasdaq and the rules and regulations of the SEC.Social Responsibility Highlights
Family RelationshipsEnvironmental Stewardship
Chad Robins, our Chief Executive Officer and Chairman of our board of directors, is the brother of Dr. Harlan Robins, our Chief Scientific Officer. There are no other family relationships among any of our directors or executive officers.
In accordance with the terms of our Articles of Incorporation and Bylaws, our board of directors is divided into three staggered classes of directors and each director is assigned to one of the three classes. At each annual meeting of the shareholders, a class of directors will be elected for a three-year term to succeed the directors of the same class whose terms are then expiring. The terms of the directors will expire upon the election and qualification of successor directors at the annual meeting of shareholders to be held during the years 2022 for Class III directors, 2023 for Class I directors and 2024 for Class II directors.
Our Class I directors are Katey Owen, PhD, and Robert Hershberg, PhD, MD;
Our Class II directors are Michelle Griffin, Peter Neupert and Leslie Trigg; and
Our Class III directors are Kevin Conroy, Michael Pellini, MD and Chad Robins.
Our Articles of Incorporation and Bylaws provide that the number of directors shall be fixed from time to time by a resolution of the majority of our board of directors.
The division of our board of directors into three classes with staggered three-year terms may delay or prevent shareholder efforts to effect a change of our management or a change in control.
Diversity, Equity and Inclusion
We pride ourselves on inclusive team building, product design and gender diversity at all levels of management. We are committed to creating and maintaining a culture of belonging. In 2021, we expanded and implemented several diversity and inclusion initiatives. We continued to provide quality DEI programming through Employee Resource Groups (“ERGs”), including Women@Adaptive, Adaptive PRIDE, Black Adapter Network and Working Life and Wellness, and in 2021 launched two new ERGs: Asian Pacific@Adaptive and Sustainability@Adaptive. We continued to explore diversity sourcing programs and partnerships, and we expanded our diversity training to a growing population of hiring managers. We also integrated hidden bias training into our Leader of People Program. Our Equity Advisory Council of senior leaders maintained a strategic focus on clinical studies, commercial engagement, recruiting, and retention through a diversity and inclusion lens. In November 2021, we received a Corporate Equality Index (“CEI”) score of 95/100 from the Human Rights Commission. Our score of 95 is an increase of 20 points from last year’s CEI score. We successfully executed a second year of our STEM
minority mentoring partnership with the University of Washington. During the grand opening of our new Seattle headquarters building, and with the help of Washington State Governor Jay Inslee, we also announced our partnership with SPIN Girls, a transformative local program that builds leadership and provides immersive STEM experiences, while pairing students with female-identifying mentors of color from across King County, Washington.
Board Diversity Matrix (As of April 1, 2022) | ||||
Total Number of Directors - 8 | ||||
| Female | Male | Non-Binary | Did Not Disclose Gender |
Part I: Gender Identity |
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Directors | 3 | 5 | -- | -- |
Part II: Demographic Background | ||||
African American or Black | -- | -- | -- | -- |
Alaskan Native or Native American | -- | -- | -- | -- |
Asian | -- | -- | -- | -- |
Hispanic or Latinx | -- | -- | -- | -- |
Native Hawaiian or Pacific Islander | -- | -- | -- | -- |
White | 3 | 5 | -- | -- |
Two or More Races or Ethnicities | -- | -- | -- | -- |
LGBTQ+ | -- | -- | -- | -- |
Did not disclose | -- | -- | -- | -- |
Employee Development and Training
We prioritize employee development and training and have established programs to support a culture of employee development. Specifically, in 2021, we offered multiple learning solutions, including our Leader Orientation Program, our Leader of People Program, and our L-re:combinator Fellowship Program. We launched Leader of Leaders for employees at or above Director level. We also completely reworked and relaunched our employee onboarding program, DayOne. All of our leadership development programs are multi-week, blended learning courses that feature self-paced online learning and live virtual training. DayOne focuses not just on human resources and compliance orientation, but cultural onboarding with small group interactions among our Chief Executive Officer, cultural ambassadors and fellow new Adapters.
In 2021, over 130 Adapters attended leadership development programs and consumed approximately 2,400 hours of training. Over 200 Adapters completed DayOne. In our annual employee survey, Adaptive Listens, Adapters generally judged our managerial programming as one of Adaptive’s strengths, a sign that investing in their development is translating into real-world results.
We are committed to operating in an environmentally responsible and efficient manner to minimize adverse impacts on the environment. Asenvironment and have submitted materials relating to our environmental, sustainability and social programs to third party Ecovadis for scoring.
For example, as part of our AdaptiGREEN initiative, we have implemented a variety of composting and recycling programs, including recycling of cardboard, Styrofoam, batteries, Keurig Coffee Pods and sustainable disposition of biohazard waste. Our biohazard waste is destroyed by incineration and the energy generated is captured and used to heat homes on the west coast. Our laboratories reduce energy consumption by utilizing a “night set back” function, which reduces the number of air changes per hour and the flow of ventilation in our fume hoods at night.
With respect to our commuter programs, we follow the King County Commuter Trip Reduction program; we actively support commuting via bikebicycle and we provide all the amenities required – secure bike storage, onsite self-serve maintenance tools and equipment, and full-service shower rooms. In 2021, we further expanded the program and now use Luum as ourOur all-in-one commuter platform. This platform, Luum, enables employees to log their daily commute and obtain “Green Credits” when they commute to work by either bicycle or walking. This credit is in the form of a daily stipend that is paid to eligible employees twice a month and can be used for things like bicycle parts and walking shoes, etc.shoes. The Luum platform tracks CO2 avoidance for each employee based on the form of commute transportation they choose each day. We also offer free transit cards (ORCA sound transit) to eligible employees that can be used across multiple public transportation systems. Charging stations for electric cars and bikes are also provided in the buildings utilized by Adapters.employees. In addition, a substantial number of our employees work from home either part-or full-time, which presents the opportunity for a reduced carbon footprint. In connection
We also work with our expansion into our new corporate headquarters, we are collaborating with our landlordlandlords to establishsupport sustainability programs such as those associated with the Green Chemistry Institute, laboratory equipment and electronics recycling. At our headquarters, we operate an urban beekeeping program in association with Alveolé, we will be establishing an urban beekeeping program with
rooftop hives to help bolster our commitment to local sustainabilitysustainability. The rooftop of our headquarters also includes gardens maintained by employees in 2022. Finally, we recently launchedconjunction with our latestEnvironmental & Sustainability ERG that will be dedicated to employee-led environmental and sustainability initiatives and programs across Adaptive.
from which vegetables are sourced for local food insecurity programs.
We also expect our suppliers to operate in an environmentally responsible and efficient manner. Our supplier codeSupplier Code of conductConduct requires suppliers to comply with all applicable environmental regulations; to have systems in place to ensure safe handling, movement, storage, recycling, reuse or management of waste, air emissions and wastewater discharges; and to have systems in place to prevent and mitigate accidental spills and releases of fuels, raw materials, chemicals, intermediates, products and other hazardous materials to the environment.
Our People
Our employees, internally referred to as “Adapters,” are passionate about immune medicine, empowered by scientific discipline and fueled by our foresight and curiosity about the adaptive immune system. As of December 31, 2023, we had 709 full-time employees of which 132 hold medical or doctoral degrees. None of our employees are subject to a collective bargaining agreement and we have not experienced any work stoppages. We believe relations with our employees are good. For example, we were named the Work Place of the Year by GeekWire in 2023.
Diversity and Inclusion
We pride ourselves on inclusive team building, product design and gender diversity at all levels of management. We are committed to creating and maintaining a culture of belonging.
Compensation and Benefits
We strive to provide compensation and benefits that are competitive to market and create incentives to attract and retain employees. Our compensation package includes market-competitive base pay, performance-based short-term incentives, health care, retirement benefits, paid time off and family leave. In addition, we offer employees the benefit of equity ownership in the Company through restricted stock unit awards. We also provide access to a variety of health and wellness resources.
Employee Development and Training
We prioritize employee development and training and have established programs to support a culture of employee development. Our Adaptive Leadership Council provides senior employees with access to, and a voice in, management decisions.
Product Safety
We are committed to ensuring that our products are manufactured and supplied at high standards of quality. Our manufacturing operations are conducted in compliance with applicable regulatory requirements, Good Clinical Laboratory Practices and our own internal rigorous quality standards. We also require that our suppliers and partners adhere to high standards, and we conduct audits and oversight of our supply chain.
In addition, it is our policy to comply with all applicable drug, medical device, diagnostic, clinical laboratory and research laws and regulations, including Food and Drug Administration registration, notification, and/or approval, marketing and sales, research and manufacturing requirements, such as Good Laboratory Practices, Good Manufacturing Practices and Good Clinical Practices, as applicable. We also comply with Clinical Laboratory Improvement Amendments of 1988 requirements and related regulations for clinical laboratory testing, where applicable.
8
CORPORATE GOVERNANCE
Our Board
Our continuing directors and their respective ages (as of April 10, 2024) and class designations are as follows:
Name | Age | Director Designation | ||
Michelle Griffin | 58 | Class II Director | ||
Robert Hershberg, PhD, MD | 61 | Class I Director | ||
Peter Neupert | 68 | Class II Director | ||
Katey Owen, PhD | 55 | Class I Director | ||
Michael Pellini, MD | 58 | Class III Director | ||
Chad Robins | 49 | Class III Director |
Our Criteria for Board Nomination and Service
Our criteria for board membership include specific measures for determining whether a director will be able to devote sufficient time and effort to the role, including consideration of the potential impact of service on other public company boards. This determination is made at the time of nomination and as appropriate during a director’s service on our board if their circumstances change, recognizing that the ability to fully engage in multiple activities will vary depending on the director and the activities.
In that respect, our criteria relating to devotion of time and effort to the Company board include:
| • | Time and Effort: Willing to commit the time and energy necessary to satisfy the requirements of the board and board committee membership; attendance and participation in all board meetings and board committee meetings in which they are a member; willingness to rigorously prepare prior to each meeting and actively participate in the meeting as a thought partner; willingness to make himself/ herself available to management upon request to provide advice and counsel. |
In addition, our Bylaws currently address the question of what levels of service on other companies’ boards will be considered permissible for our board directors as follows:
Serving on the board of directors has adoptedrequires significant time and attention. Directors are expected to spend the time needed and meet as often as necessary to discharge their responsibilities properly. It is expected that, without specific approval from the board of directors: (i) no director shall serve on more than five public company boards (including our board) or on the board of any company that, in our board’s judgment, materially competes with the Company, (ii) if any officer of the Company is also a director of the Company, such officer may not serve on more than two public company boards (including our board), and (iii) no member of the Audit Committee shall serve on more than three public company audit committees (including the Company’s Audit Committee). Directors should advise the chairperson of the Nominating and Governance Committee before accepting membership on other boards of directors or other significant commitments involving affiliation with other businesses, non-profit entities or governmental units.
In addition, the nominating and corporate governance guidelines covering, amongcommittee considers individual qualifications, including relevant career experience, strength of character, maturity of judgment and familiarity with our business and industry, as well as all other things,factors it considers appropriate for all board nominations, whether made by shareholders or others.
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The following skills and experiences were considered by the dutiesnominating and responsibilities of and independence standards applicable to our directors and board committee structures and responsibilities. These guidelines are available on the “Governance” section of our website at https://investors.adaptivebiotech.com/governance/governance-documents. Our corporate governance guidelines providecommittee in nominating our non-employee directors:
Current Board Member | Core-competency / Experience | Representative Relevant Skill Sets | ||
| Michelle Griffin | Compliance and risk management; Therapeutics / Drug Discovery: commercialization expertise | Director of life sciences companies; past audit committee chair experience; past CEO/CFO experience; overall extensive operational experience in the biotechnology industry and deep experience in public company financial matters; MBA | ||
| Robert Hershberg | Therapeutics / Drug Discovery: extensive R&D and commercialization expertise | CEO positions in the biotechnology industry; deep technical expertise; overall extensive executive leadership experience in the biotechnology industry, including operational experience managing sustained revenue and commercial growth in a strategic manner; PhD/MD | ||
| Peter Neupert | Diagnostic and Pharmaceutical Services: commercial expertise; Capital growth; Finance (funding) | Director of diagnostic laboratory services provider; venture capital provider experience; overall extensive experience in executive leadership roles in the health services sector and as a member of the board of directors of several organizations in the biotechnology industry; MBA | ||
| Katey Owen | Therapeutics / Drug Discovery: R&D expertise | Director level position in pharmaceutical development; overall extensive scientific expertise and strategic insights into commercialization and manufacturing at scale; PhD | ||
| Michael Pellini | Diagnostic and Pharmaceutical Services: commercial expertise; Capital growth; Finance (funding) | Venture capital provider experience; past biotechnology CEO experience; overall extensive medical and clinical experience in the biotechnology industry, including operational experience managing sustained revenue and commercial growth in a strategic manner; MD/MBA | ||
All board members have global expansion and distribution experience, as well as high level strategic corporate development knowledge.
10
While we do not have a formal policy on diversity for members of the board of directors, with flexibility to combinethe nominating and corporate governance committee values and, as reasonable, acts on the need for diversity of director demographics, skills and viewpoints when considering new candidates. The diversity characteristics of our directors are below. None identify as LGBTQ+ or separate the positions of chairpersonas an underrepresented minority; however, future candidates which do so identify and meet our criteria for board service will be considered, as appropriate.
Board Diversity Matrix (As of April 10, 2024) | ||||||||
Total Number of Directors – 6 |
| |||||||
| Female | Male | |||||||
Part I: Gender Identity | ||||||||
Directors | 2 | 4 | ||||||
Part II: Demographic Background |
| |||||||
White | 2 | 4 | ||||||
Family Relationships
Chad Robins, our Chief Executive Officer and Chairman of our board of directors, and chief executive officer and to appoint a lead independent director in accordance with its determination that using one or the other structure would be in our best interests. Chad Robins is the current chairmanbrother of Dr. Harlan Robins, our Chief Scientific Officer. There are no other family relationships among any of our board of directors and Peter Neupert currently serves as the lead independent director of our board of directors.or executive officers.
Board Leadership Structure
Our board of directors has concluded that our current board leadership structure is appropriate for Adaptive’s needs at this time. Our board of directors continues to believe that the combined role of chairperson and chief executive officer promotes united leadership and direction and provides management a clear focus to execute our strategy and business plans. As Chief Executive Officer, Mr. Robins is best suited to ensure that critical business issues are brought before our board of directors, which enhances our board of directors’ ability to develop and implement business strategies.
In his role as lead independent director, Mr. Neupert presides over the independent director sessions of our board of directors in which Mr. Robins, as our Chief Executive Officer, does not participate and serves as a liaison to management on behalf of the non-employee members of our board of directors. Mr. Neupert has been on our board of directors since December 2013, is an independent director who serves on our compensation and human capital committee, audit committee and our nominating and corporate governance committee, has been an executive officer of public companies, and has meaningful experience as an independent director for other public companies. Accordingly, we believe Mr. Neupert provides a strong voice for our independent directors.
All directors are encouraged to suggest the inclusion of agenda items and meeting materials, and any director is free to raise at any board meeting items that are not on the agenda for that meeting.
Our non-employee directors regularly meet in executive sessions without the presence of any members of management. The lead independent director presides at these meetings and provides the guidance and feedback of our non-employee directors to our Chairman and management team.
Our board of directors, as a whole, has responsibility for risk oversight, and each committee of our board of directors oversees and reviews risk in areas that are relevant to it, including: (1) for the compensation and human capital committee, risks associated with our compensation arrangements and policies;policies (including, as relevant, matters pertaining to our environmental and social policies and practices); (2) for the nominating and corporate governance committee, periodic review and update of our code of conduct and ethics;ethics as well as corporate governance-specific policies; and (3) for the audit committee, internal controls and regulatory risks related to accounting and finance, as well as periodic review of cybersecurity and privacy risks. The risk oversight responsibility of our board of directors and its committees is supported by our management reporting processes, which are designed to provide visibility to our board of directors and to our personnel who are responsible for risk assessment information about the identification, assessment and management of critical risks.
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Size of Board
Our board of directors consists of six members. Our directors hold office until their successors have been elected and qualified or until the earlier of their resignation or removal. Our Articles of Incorporation and Bylaws provide that our directors may only be removed for cause and then only by the holders of the shares entitled to elect the director or directors whose removal is sought if, with respect to a particular director, the number of votes cast in favor of removing such director (or the entire board of directors) exceeds the number of votes cast against removal, and that any vacancy on our board of directors, including a vacancy resulting from an enlargement of our board of directors, may be filled only by the affirmative vote of a majority of our directors then in office.
Staggered Board and Shareholder Proposals
In accordance with the terms of our Articles of Incorporation and Bylaws, our board of directors is divided into three staggered classes of directors and each director is assigned to one of the three classes. We continue to believe that this board structure is the best choice for Adaptive at this time.
At each annual meeting of the shareholders, a class of directors will be elected for a three-year term to succeed the directors of the same class whose terms are then expiring. The terms of the directors will expire upon the election and qualification of successor directors at the annual meeting of shareholders to be held during the years 2024 for Class II directors, 2025 for Class III directors and 2026 for Class I directors.
Our Articles of Incorporation and Bylaws provide that the number of directors shall be fixed from time to time by a resolution of the majority of our board of directors.
Shareholder proposals may be tendered in the first quarter; however, the division of our board of directors into three classes with staggered three-year terms may delay or prevent shareholder efforts to effect an immediate change of our management or a change in control.
While we have no formal policy with respect to shareholder nominees, the committee will consider recommendations validly made by our shareholders pursuant to Rule 14a-8 under the Exchange Act and our Bylaws.
Board Governance Guidelines
Our board of directors has adopted corporate governance guidelines covering, among other things, the duties and responsibilities of and independence standards applicable to our directors and board committee structures and responsibilities. These guidelines are available on the “Governance” section of our website at https://investors.adaptivebiotech.com/governance/governance-documents.
Our corporate governance guidelines provide our board of directors with flexibility to combine or separate the positions of chairperson of our board of directors and chief executive officer and to appoint a lead independent director in accordance with its determination that using one or the other structure would be in our best interests. Chad Robins is the current chairman of our board of directors and Peter Neupert currently serves as the lead independent director of our board of directors.
Attendance by Members of the Board at Meetings
Our board of directors held fiveeight meetings and acted by unanimous written consent fivefour times during the year ended December 31, 2021.2023. During 2021,2023, all then incumbent directors attended at least 75%all but one of the combined total of (1) all board meetings and (2) all meetings of committees of our board of which the incumbent director was a member. Currently, we do not maintain a formal policy regarding director attendance at the Annual Meeting; however, it is expected that, absent compelling circumstances, each of our directors will attend our Annual Meeting via the Internet. All directors attended the virtual annual meeting in 2021, except Dr. Hershberg.2023.
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Executive Sessions
Our non-employee directors meet regularly in executive sessions without management to consider such matters as they deem appropriate. Our lead independent director, Mr. Neupert, presides over all executive sessions.
Committees of our Board of Directors
Our board of directors has established an audit committee, a compensation and human capital committee and a nominating and corporate governance committee, each of which operates pursuant to a written charter adopted by our board of directors. Our board of directors may also establish other committees from time to time to assist the board of directors. The composition and functioning of all of our committees comply with all applicable requirements of the Sarbanes-Oxley Act, Nasdaq and SECSecurities and Exchange Commission (“SEC”) rules and regulations, subject to applicable phase-in periods for committees. Each committee has a charter, which is available on our website at www.adaptivebiotech.com.
Independence and Current Committee Positions
Our board of directors has determined that all members of our board of directors, except Chad Robins, are independent directors for purposes of the rules of Nasdaq and the SEC. In making this determination, our board of directors considered the relationships that each non-employee director has with us and all other facts and circumstances that our board of directors deemed relevant, including the beneficial ownership of our common stock by each non-employee director. The composition and functioning of our board of directors and each of our committees complies with all applicable requirements of Nasdaq and the rules and regulations of the SEC.
The composition of our board committees and independence of their members are summarized below:
Name |
| Independent | Audit Committee | Compensation and Human Capital Committee | Nominating and Governance Committee | |||
|
|
| ||||||
|
| |||||||
Michelle Griffin |
| Yes | Member (Chair) |
|
| |||
Robert Hershberg, PhD, MD | Yes |
| Member (Chair) |
| ||||
Peter Neupert(1) | Yes | Member | Member | Member (Chair) | ||||
Katey Owen, PhD | Yes |
|
| Member | ||||
|
|
|
|
| ||||
Michael Pellini, MD |
| Yes | Member |
| Member | |||
Chad Robins | No |
|
|
|
(1) | Lead Independent Director |
Audit Committee Service and Responsibilities
During 2021,the first half of 2023, Michelle Griffin, Eric Dobmeier, Leslie Trigg and Michael Pellini, MD and former director Leslie Trigg served on the audit committee, which is currently chaired by Ms. Griffin. In March 2021,Peter Neupert replaced Ms. Trigg replaced Mr. Dobmeier on the audit committee.committee after her resignation from our board in June 2023. The audit committee met five times during 2021.2023. Our board of directors has determined that each member of the audit committee during 2023 was and is “independent” as that term is defined in Nasdaq rules and has sufficient knowledge in financial and auditing matters to serve on the audit committee. In addition, our board of directors has determined that Ms. Griffin, Dr. Pellini, and Mr. Neupert each meet (and, during her service, Ms. Trigg and Dr. Pellini each meetmet) the heightened independence requirements for audit committee members required under Section 10A of the Exchange Act and related SEC and Nasdaq rules. Mr. Dobmeier met these requirements prior to his resignation in March 2021.
Our board of directors has determined that each member of the audit committee is an “audit committee financial expert,” as defined in Item 407(d)(5)(ii) of Regulation S-K. The audit committee’s responsibilities include:
appointing,Appointing, approving the compensation of and assessing the independence of our independent registered public accounting firm;firm.
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pre-approvingPre-approving audit and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;firm.
reviewingReviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements;statements.
reviewingReviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures, as well as critical accounting policies and practices used by us;us.
coordinatingCoordinating the oversight and reviewing the adequacy of our internal control over financial reporting;reporting.
establishingEstablishing policies and procedures for the receipt and retention of accounting-related complaints and concerns;concerns.
recommending,Recommending, based upon the audit committee’s review and discussions with management and our independent registered public accounting firm, whether our audited financial statements should be included in our Annual Report on Form 10-K;10-K.
monitoringMonitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters;matters.
preparingPreparing the audit committee report required by SEC rules to be included in our annual proxy statement;statement.
reviewingReviewing related person transactions for potential conflict of interest situations and approving such transactions in accordance with our policies; andpolicies.
reviewingReviewing content and talking points of our quarterly earnings releases in parallel with the full board of directors.
In addition, the audit committee periodically reviews our insider trading policy, which prohibits short sales, pledging, hedging or other monetization transactions, and other transactions which would, if consummated, allow insiders to continue to own our securities without the full risks and rewards of ownership.
Compensation and Human Capital Committee Service and Responsibilities
Until September 2023, Robert Hershberg, PhD, MD, Peter Neupert and former director Kevin Conroy serveserved on the compensation and human capital committee, chaired by Dr. Hershberg. Katey Owen replaced Mr. Conroy on the committee after his resignation from our board in September 2023. The compensation committee met four times during 2021, and each member attended all meetings.2023. Our board of directors has determined that each member of the compensation and human capital committee during 2023 was and is “independent” as that term is defined in Nasdaq rules and is a “non-employee“non-employee director” under Rule 16b-3 under the Exchange Act. In addition, our board of directors has determined that Dr. Hershberg, Mr. Neupert and Ms. Owen each meet (and, during his service, Mr. Conroy each meetmet) the heightened independence requirements for compensation and human capital committee purposes under Section 10C of the Exchange Act and related SEC and Nasdaq rules. The compensation and human capital committee’s responsibilities include:
reviewingReviewing and approving our philosophy, strategies, policies and plans with respect to the compensation of our Chief Executive Officer and our other executive officers;officers.
makingMaking recommendations to our board of directors with respect to the compensation of our Chief Executive Officer and our other executive officers;officers.
reviewingReviewing and assessing the independence of compensation advisors;advisors.
overseeingOverseeing and administering our equity incentive plans;plans.
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| Reviewing and making recommendations to our board of directors |
preparing the compensation committee reports required by the SEC, including our “Compensation Discussion and Analysis” disclosure.
The compensation committee, during its first meeting of the year, addresses achievements of the prior year’s corporate goals for purposes of determining annual cash incentive awards. Following that, most of the significant adjustments to compensation are made to base salary, annual cash incentive and equity awards at the compensation committee’s second meeting of the year, typically held during the first quarter. Specific issues considered with respect to compensation for 2021 included salary, annual cash incentives and equity compensation in light of our third year as a public company, the impact of the COVID-19 pandemic on healthcare services and company operations as well as the evolving markets for immune medicine products and services; equity compensation programming, including the development of guidelines to be used for future equity grant cycles, the proper mix of equity vehicles, providing overall pool budgeting and modeling and providing updates with regards to long-term incentive trends among peers; and the non-executive equity compensation program design and effects on employee retention and engagement.director compensation.
The compensation committee also considers at various meetings throughout the year matters related to individual current and future officer compensation, such as compensation for prospective new hires for both our established and emerging products and services, as well as high-level issues related to compensation strategy, such as efficacy of the current strategy, potential modifications to the strategy, risks created by the strategy, new regulatory requirements and/or the adoption of new trends, and recruitment and retention concerns.
| • | Preparing the compensation and human capital committee reports required by the SEC, including our “Compensation Discussion and Analysis” disclosure. |
Nominating and Corporate Governance Committee Service and Responsibilities
Kevin Conroy, Michael Pellini, MD, and Peter Neupert serve on the nominating and corporate governance committee, chaired by Mr. Neupert. Mr. Conroy also served on the committee until his departure from our board in September 2023. The nominating and corporate governance committee met twiceonce during 2021.2023. Our board of directors has determined that each of Mr. Conroy, Dr. Pellini and Mr. Neupert is (and, during his service, Mr. Conroy was) “independent” as defined in Nasdaq rules. The nominating and corporate governance committee’s responsibilities include:
| • | Developing and recommending to the board of directors criteria for board and committee membership, including the formal set of board nomination and service qualifications adopted in 2023 and shared under “Our Criteria for Board Nomination and Service” above. |
developing and recommending to the board of directors criteria for board and committee membership;
establishingEstablishing procedures for identifying and evaluating board of director candidates, including nominees recommended by shareholders;shareholders.
reviewingReviewing the composition of the board of directors to ensure that it is composed of members containing the appropriate skills and expertise to advise us;us.
identifyingIdentifying and screening individuals qualified to become members of the board of directors;directors.
recommendingRecommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees;committees.
developingDeveloping and recommending to the board of directors a code of business conduct and ethics and a set of corporate governance guidelines; andguidelines.
overseeingOverseeing the evaluation of our board of directors and management.
The nominating and corporate governance committee will consider director candidates recommended by shareholders on the same basis that it evaluates other nominees for director. Shareholders who wish to recommend a candidate to our nominating and corporate governance committee for consideration for nomination should send to us, at our principal executive offices, information regarding the candidate. In order to identify potential director candidates, the committee may utilize its or our existing networks or retrainretain a third-party recruiting firm.
At a minimum, the nominatingCompensation and corporate governance committee considers individual qualifications, including relevant career experience, strength of character, maturity of judgment and familiarity with our business and industry, as well as all other factors it considers appropriate. With respect to nominations made directly by shareholders, the committee will consider the factors enumerated above. While we have no formal policy with respect to shareholder nominees, the committee will consider recommendations validly made by our shareholders pursuant to Rule 14a-8 under the Exchange Act and our Bylaws.
While we do not have a formal policy on diversity for members of the board of directors, the nominating and corporate governance committee values the need for diversity of director skills and viewpoints when considering new candidates, as evidenced by the recruitment and appointment of Ms. Trigg and Dr. Owen in March 2021.
CompensationHuman Capital Committee Interlocks and Insider Participation
During 2021,At times as noted above, Kevin Conroy, Robert Hershberg, PhD, MD, and Peter Neupert, and Katey Owen served as members of our compensation committee.and human capital committee during 2023. During 2021,2023, none of the members of our compensation and human capital committee were officers or employees or had a relationship requiring disclosure under “Relationships“Relationships and Related Party Transactions.Transactions.” None of our executive officers currently serves, nor in the past year has served, as a member of the board of directors or compensation and human capital committee of any entity that has one or more executive officers serving on our board of directors or compensation and human capital committee.
We have adopted a written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. AThe code is updated periodically; a current copy of the code is posted on our website at www.adaptivebiotech.com. While we make ministerial and technical amendments to the code of conduct and ethics from time to time, if we make any substantive amendments to, or grant any waivers from, the code for any officer or director, we will disclose the nature of such amendment or waiver on our website or in a current report on Form 8-K.
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DIRECTOR COMPENSATION
The following table presents the total compensation for each person who served as a non-employee member of our board of directors at any time during the year ended December 31, 2021.2023. Other than as set forth in the table and described more fully below, we did not pay any compensation, make any additional equity awards or non-equity awards to or pay any other compensation to any of the non-employee members of our board of directors in 2021.2023. We reimburse non-employee members of our board of directors for reasonable travel and out-of-pocket expenses incurred in attending meetings of our board of directors and committees of our board of directors. We also do not, and do not expect to, provide separate compensation to our directors who are also our employees, such as Chad Robins, our Chief Executive Officer. Mr. Robins’ compensation as our principal executive officer in 20212023 is reported in the “Executive Compensation” section of this proxy statement.
Name |
|
| Fees Earned or Paid in Cash ($) |
|
| Option Awards(1) ($) |
|
| Stock Awards(2) ($) |
|
| Total ($) |
|
Kevin Conroy(3) |
|
| 50,000 |
|
| 141,325 |
|
| 100,016 |
|
| 291,341 |
|
Eric Dobmeier(4) |
|
| 10,417 |
|
| 141,325 |
|
| 100,016 |
|
| 251,758 |
|
David Goel(5) |
|
| 10,417 |
|
| 141,325 |
|
| 100,016 |
|
| 251,758 |
|
Michelle Griffin(6) |
|
| 70,000 |
|
| 141,325 |
|
| 100,016 |
|
| 311,341 |
|
Robert Hershberg, PhD, MD(7) |
|
| 65,000 |
|
| 141,325 |
|
| 100,016 |
|
| 306,341 |
|
Peter Neupert(8) |
|
| 95,000 |
|
| 141,325 |
|
| 100,016 |
|
| 336,341 |
|
Katey Owen, PhD(9) |
|
| 39,444 |
|
| 306,938 |
|
| 199,979 |
|
| 546,361 |
|
Michael Pellini, MD(10) |
|
| 50,000 |
|
| 141,325 |
|
| 100,016 |
|
| 291,341 |
|
Leslie Trigg(11) |
|
| 39,444 |
|
| 306,938 |
|
| 199,979 |
|
| 546,361 |
|
Name | Fees Earned or Paid in Cash ($) | Option Awards(1) ($) | Stock Awards(2) ($) | Total ($) | ||||||||||||
Kevin Conroy(3) | 40,272 | 124,999 | 124,997 | 290,268 | ||||||||||||
Michelle Griffin(4) | 80,000 | 124,999 | 124,997 | 329,996 | ||||||||||||
Robert Hershberg, PhD, MD(5) | 75,000 | 124,999 | 124,997 | 324,996 | ||||||||||||
Peter Neupert(6) | 105,000 | 124,999 | 124,997 | 354,996 | ||||||||||||
Katey Owen, PhD(7) | 60,000 | 124,999 | 124,997 | 309,996 | ||||||||||||
Michael Pellini, MD(8) | 60,000 | 124,999 | 124,997 | 309,996 | ||||||||||||
Leslie Trigg(9) | 26,301 | 124,999 | 124,997 | 276,297 | ||||||||||||
(1) | In accordance with SEC rules, amounts in this column reflect the aggregate grant date fair value of stock options granted during |
(2) | In accordance with SEC rules, amounts in this column reflect the aggregate grant date fair value of restricted stock units (“RSUs”) granted during |
| (3) |
|
| (4) | As of December 31, |
|
|
(5) |
|
| As of December 31, |
| As of December 31, |
| As of December 31, |
| Ms. Trigg resigned from our board of directors on June 9, 2023. As of December 31, |
|
|
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Our board of directors has adopted a non-employee director compensation policy amended on February 14, 2021, that is designed to enable us to attract and retain, on a long-term basis, highly qualified non-employee directors. Specifically, we provide $50,000provided $60,000 annual cash retainer payments payable quarterly in arrears, to each director who is not an employee of ours, with additional amounts for those serving as Lead Independent Director and chairpersons of our audit, compensation, and nominating and corporate governance committees, as set forth below:
Additional
| ||||
Lead Independent Director | 35,000 | |||
Audit Committee Chairperson | 20,000 | |||
Compensation and Human Capital Committee Chairperson | 15,000 | |||
Nominating and Corporate Governance Committee Chairperson | 10,000 | |||
In addition, subject to board discretion, each non-employee director initially elected or appointed to our board of directors will receive a grant of stock options and RSUs with a total target economic value equivalent to $400,000.$400,000, comprised 50% of stock options and 50% of RSUs. With respect to the stock option grant, 25% of the shares vest on the first anniversary of the vesting commencement date and 1/48th48th of the shares vest in monthly installments thereafter, subject to continuous service through each applicable vesting date. With respect to the RSU grant, 25% of the shares vest on each of the first four anniversaries of the vesting commencement date, subject to continuous service through each applicable vesting date.
On the first meeting of our board of directors of each calendar year (unless the board of directors determines to award them on a different date) each continuingOur non-employee director will also receive a grantcompensation policy sets the total target economic value of the annual director equity grants, comprised 50% of stock options and 50% of RSUs, with a total target economic value equivalent to $200,000.at $250,000. With respect to the stock option grant, 1/12th12th of the shares vest on each of the first twelve months following the vesting commencement date, subject to continuous service through each applicable vesting date. With respect to the RSU grant, 100% of the shares vest on the first anniversary of the vesting commencement date, subject to continuous service through each applicable vesting date.
The aggregate amount of compensation under our 2019 Equity Incentive Plan (the “2019 Plan”), including both the grant date fair value of equity compensation and cash compensation, paid to any non-employee director in a calendar year will not exceed $750,000 for the first year of service and $600,000 for each year of service thereafter.
1:ELECTION OF DIRECTORS
Pursuant to our Articles of Incorporation and our Bylaws, the total number of directors constituting the board of directors is fixed from time to time by the board. The current authorized number of directors is fixed at eight.six. The board of directors is divided into three classes, each containing as nearly as possible an equal number of directors. The current term of office of our Class IIIII directors expires at the Annual Meeting, while the term for our Class IIII directors will expire at our 20232025 annual meeting of shareholders and the term for our Class III directors expires at our 20242026 annual meeting of shareholders.
Based upon the recommendation of our nominating and corporate governance committee, the board has nominated Kevin Conroy, Michael Pellini, MDPeter Neupert and Chad Robins, allMichelle Griffin, both current Class IIIII directors, for election at the Annual Meeting. Each director elected at the Annual Meeting will serve a three-year term expiring at our 20252027 annual meeting of shareholders and until his or her successor is duly elected and qualified as a Class IIIII director, or until his or her earlier death, resignation or removal. At the Annual Meeting, proxies cannot be voted for a greater number of individuals than the threetwo nominees named in this proxy statement.
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The board of directors and the nominating and governance committee believe the skills, qualities, attributes and experience of our directors provide us with business acumen and a diverse range of perspectives to engage each other and management to effectively address our evolving needs and represent the best interests of our shareholders.
VacanciesIf any nominee should become unavailable for election prior to the Annual Meeting, an event that currently is not anticipated, the proxies will be voted in favor of the election of a substitute nominee or nominees proposed by the board of directors or the number of directors may be reduced accordingly. Each nominee has agreed to serve if elected and the board of directors has no reason to believe that any nominee will be unable to serve.
We confirm as well that vacancies on the board, including any vacancy created by an increase in the size of the board, may be filled only by a majority of the directors remaining in office, even though less than a quorum of the board, or a sole remaining director. A director elected by the board to fill a vacancy will serve until the next election of the class of directors for which such director was chosen and until such director’s successor is elected and qualified, or until such director’s earlier retirement, resignation, disqualification, removal or death.
If any nominee should become unavailable for election prior to the Annual Meeting, an event that currently is not anticipated, the proxies will be voted in favor of the election of a substitute nominee or nominees proposed by the board of directors or the number of directors may be reduced accordingly. Each nominee has agreed to serve if elected and the board of directors has no reason to believe that any nominee will be unable to serve.
Our continuing directors and their respective ages (as of April 22, 2022) and class designation are as follows:
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Information about Class III Director Nominees Biographies
Set forth below is biographical information for each nominee and a summary of the specific qualifications, attributes, skills and experiences which led our board of directors to conclude that each nominee should serve on the board of directors at this time.
Chad Robins co-founded our company in September 2009 andPeter Neupert has served as our Chief Executive Officer and a member of our board of directors since incorporation.December 2013. Mr. Robins currently serves on the board of directors of CM Life Sciences III, Inc.,Neupert served as an Operating Partner at Health Evolution Partners, a public special purpose acquisition company sponsored by affiliates of Casdin Capital, LLC and Corvex Management LP. Mr. Robins served on the board of directors of ARYA Sciences Acquisition Corp II, a public special purpose acquisition company,private equity fund, from June 2020February 2012 to October 2020.July 2014. Prior to co-founding our company,joining Health Evolution Partners, Mr. Robins held numerous executive-level positions in medical technology, investmentNeupert served as Corporate Vice President, Health Solutions Group at Microsoft from August 2005 to January 2012, and real estate companies. Mr. Robins holds an MBA from The Wharton School at the University of Pennsylvania and a BS in Managerial Economics from Cornell University. We believe Mr. Robins is qualified to serve as a member of our board of directors based on our review of his experience, qualifications, attributes and skills, including co-founding our company and his executive leadership experience in the biotechnology industry.
Kevin Conroy has served on our board of directors since April 2019. Mr. Conroy has served as the Chief Executive Officer and Chairman of the board of directors of Exact Sciences Corporation, a public molecular diagnostic company, since March 2009.Drugstore.com, which he joined in July 1998. Mr. Conroy alsoNeupert currently serves on the board of directors of Epizyme, Inc.,Laboratory Corporation of America Holdings, a public clinical-stage biopharmaceutical company. Prior to joining Exact Sciences Corporation, Mr. Conroyclinical laboratory company, and Fortrea, a clinical research organization. He has previously served as Chief Executive Officer of Third Wave Technologies, Inc., a molecular diagnostics company, from December 2005 to August 2008. From July 2018 to July 2020, Mr. Conroy served on the board of directors of ARYA Sciences Acquisition Corp., a public special purpose acquisition company sponsored by an affiliate of Perceptive Advisors LLC that ultimately acquired Immatics N.V. From February 2021 to September 2021, Mr. Conroy served on the board of directors of CM Life Sciences II Inc., a public special purpose acquisition company that ultimately acquired SomaLogic, Inc., and served on the board of SomaLogic, Inc., until November 2021.Mr. Conroy holds a JD from the University of Michigan Law School and a BS in Electrical Engineering from Michigan State University. We believe Mr. Conroy is qualified to serve on our board of directors because of his extensive business, legal and executive leadership experience in the biotechnology industry.
Michael Pellini, MD, has served on our board of directors since February 2018. Dr. Pellini currently serves as a Managing Partner of Section 32, LLC, a technology and life sciences-based venture capital fund. Dr. Pellini currently serves as a member of the board of directors of the Personalized Medicine Coalition, a nonprofit organization, the Mission Hospital Foundation, a nonprofit organization, Sema4 Holdings Corp., a public health machine learning company, Singular Genomics
Systems, Inc., a public development-stage life sciences company, and several private companies. Dr. Pellini previously served as Chairman of the board of directors, Chief Executive Officer and President at Foundation Medicine, Inc., a molecular information company, which was acquired by the Roche Group in 2018. Dr. Pellini holds an MD from Jefferson Medical College, an MBA from Drexel University and a BA in Economics from Boston College. We believe Dr. Pellini is qualified to serve on our board of directors because of his medical and clinical experience in the biotechnology industry.
Board Recommendation
THE BOARD RECOMMENDS A VOTE “FOR” EACH OF THE THREE NAMED CLASS III DIRECTOR NOMINEES.
Information about Other Directors Not Standing for Election at this Meeting
Class I Directors with Terms Expiring at the 2023 Annual Meeting
Katey Owen, PhD, hasMr. Neupert served as a member of our boardthe Board of directors since March 2021. Dr. Owen has served as Director, Neglected Tropical Diseases at the Bill & Melinda Gates Foundation, a private foundation with the goalTrustees of Fred Hutchinson Cancer Research Center from June 2007 to enhance healthcare and reduce extreme poverty, since July 2017. At the Bill & Melinda Gates Foundation, Dr. OwenJune 2020. Mr. Neupert holds end-to-end responsibilities for a portfolio of investments with the goal to eliminate tropical diseasesan MBA from the planet. Dr. Owen joined the Gates Foundation in August 2013 as Deputy Director for Vaccine Development, supporting a portfolio of approximately 100 different vaccines in development. Prior to joining the Gates Foundation, Dr. Owen held roles of increasing responsibility at Merck & Co., including Executive Director, Merck Vaccines, Sr. Director, Merck Manufacturing Division, and Director, Merck Research Laboratories. Dr. Owen holds a PhD in Molecular Virology and a BS in Genetic Biology from Purdue University. We believe Dr. Owen is qualified to serve on our board of directors based on her extensive scientific expertise and strategic insights into commercialization and manufacturing at scale.
Robert Hershberg, PhD, MD, has served on our board of directors since February 2013. Dr. Hershberg has been a Venture Partner at Frazier Healthcare Partners since March 2020. Formerly, from April 2017 to March 2020, Dr. Hershberg was the executive vice president and head of business development and global alliances at Celgene (acquired by Bristol-Myers Squibb in November 2019). He was employed in positions of ascending responsibility at Celgene since joining the company in 2014, including his role as Chief Scientific Officer from January 2016 to March 2020. Dr. Hershberg previously served in several roles at VentiRx Pharmaceuticals, Inc., a clinical stage biopharmaceutical company, which he co-founded in 2006, and was Chief Executive Officer of VentiRx from 2012 until the company’s acquisition by Celgene in February 2017. Dr. Hershberg currently serves on the board of directors of NanoString Technologies, Inc., a public company that specializes in the development of cancer diagnostics tools, on the board of directors of Silverback Therapeutics, a public biopharmaceutical company specializing in tissue-targeted therapies, on the board of directors of Fate Therapeutics, Inc., a public company specializing in cellular immunotherapies, on the board of directors of Recursion Pharmaceuticals, Inc., a public company specializing in drug discovery, and as a clinical faculty member at the University of WashingtonTuck School of Medicine. Dr. Hershberg holds a PhD in Biology from the University of California, San Diego’s Affiliated PhD Program with the Salk Institute for Biological Studies and an MDBusiness at Dartmouth College and a BA in Philosophy from the University of California, Los Angeles.Colorado College. We believe Dr. HershbergMr. Neupert is qualified to serve on our board of directors based on his extensive technical expertiseexperience in leadership roles in the health services sector and executive leadershipas a member of the board of directors of several organizations in the biotechnology industry.
Class II Directors with Terms Expiring at the 2024 Annual Meeting
Michelle Griffin has served on our board of directors since March 2019. Ms. Griffin currently servespreviously served on the boardboards of directors of Acer Therapeutics, Inc., formerly a public pharmaceutical company, including(including as chair of the compensation committee. Ms. Griffin also currently serves on the board of directors ofand human capital committee), HTG Molecular Diagnostics, Inc., formerly a public commercial-stage life sciences company. Ms. Griffin also currently serves on the board of directors ofcompany, Chinook Therapeutics, formerly a public clinical-stage biotechnology company, including(including as chair of the audit committee. Ms. Griffin previously served on the board of directors and as chair of the audit committee ofcommittee), PhaseRx, Inc., formerly a public life sciences company, from February 2016 to February 2018, OncoGenex Pharmaceuticals Inc. (now Achieve Life Sciences, Inc.) from August 2008 to January 2011 and Sonus Pharmaceuticals, Inc. (now Achieve Life Sciences, Inc.) from June 2004 to August 2008.. Ms. Griffin also served as Executive Vice President, Operations, and Chief Financial Officer at OncoGenex Pharmaceuticals, Inc. from January 2011 to April 2013, served as Acting Chief Executive, Senior Vice President and Chief Operating Officer at Trubion Pharmaceuticals, Inc. from November 2009 until its acquisition in October 2010 and as its Chief Financial Officer from January 2006 to November 2009; served as Senior Vice President and Chief Financial Officer of Dendreon Corp. from August 2005 to January 2006, and served as Chief Financial Officer of Corixa Corp from October 1997 until its acquisition in August 2005. Ms. Griffin holds a BS in marketing from George Mason University and an MBA from Seattle University. We believe Ms. Griffin is
qualified to serve as a member of our board of directors based on our review of her extensive operational experience in the biotechnology industry and deep experience in public company financial matters.
Peter Neupert has served as a member of our board of directors since December 2013. Mr. Neupert served as an Operating Partner at Health Evolution Partners, a private equity fund, from February 2012 to July 2014. Prior to joining Health Evolution Partners, Mr. Neupert served as Corporate Vice President, Health Solutions Group at Microsoft from August 2005 to January 2012, and as the Chief Executive Officer and Chairman of the board of directors of Drugstore.com, which he joined in July1998. Mr. Neupert currently serves on the board of directors of Laboratory Corporation of America Holdings, a public clinical laboratory company, and he previously served as a member of the board of directors of NextGen Healthcare, Inc., a public software company, and several private companies. Mr. Neupert served as a member of the 18
Board of Trustees of Fred Hutchinson Cancer Research Center from June 2007 to June 2020. Mr. Neupert holds an MBA from the Tuck School of Business at Dartmouth College and a BA in Philosophy from Colorado College. We believe Mr. Neupert is qualified to serve on our board of directors based on his extensive experience in leadership roles in the health services sector and as a member of the board of directors of several organizations in the biotechnology industry.Recommendation
THE BOARD RECOMMENDS A VOTE “FOR” EACH OF THE TWO NAMED CLASS II DIRECTOR NOMINEES.
Leslie Trigg has served as a member of our board of directors since March 2021. Ms. Trigg has served as President and Chief Executive Officer and member of the board of directors of Outset Medical Inc., a medical technology company transforming dialysis care, since November 2014. Ms. Trigg also serves on the board of directors of ARYA Sciences Acquisition Corp IV, a public special purpose acquisition company sponsored by an affiliate of Perceptive Advisors LLC. Ms. Trigg was an Executive in Residence at Warburg Pincus, a private equity firm, from March 2012 to March 2014. Prior to that, Ms. Trigg served in several roles at Lutonix (acquired by CR Bard), a medical device company, from January 2010 to February 2012, most recently as Executive Vice President, and as Chief Business Officer of AccessClosure (acquired by Cardinal Health), a medical device company, from September 2006 to June 2009. She also previously held positions with FoxHollow Technologies (acquired by ev3/Covidien), a manufacturer of devices to treat peripheral artery disease, Cytyc, a diagnostic and medical device company, Pro-Duct Health (acquired by Cytyc), a medical device company, and Guidant, a cardiovascular medical device company. Ms. Trigg holds a BS from Northwestern University and an MBA from The Haas School of Business, UC Berkeley. We believe Ms. Trigg is qualified to serve on our board of directors based on her executive leadership experience in the biotechnology industry, including experience managing sustained revenue and commercial growth in a strategic manner.
The following table sets forth certain information about our executive officers:
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The following is a biographical summary of the experience of our executive officers, with the exception of Chad Robins, whose biographical summary is set forth under the caption “Our Directors –Additional Biographical Information about Other Directors Not Standing for Election at this Meeting
Class III Director Nominees.
Julie Rubinstein has served as our President since February 2018. Prior to becoming our President, Ms. Rubinstein served as our Chief Business Officer from January 2016 to February 2018, and our head of Corporate and Business Development from April 2011 to January 2016. Prior to joining us, Ms. Rubinstein held various worldwide commercial development roles at Pfizer Inc.’s Oncology division, primarily focusing on cancer immunotherapy. She also served in various rolesDirectors with Johnson & Johnson Services, Inc., including in Europe. Ms. Rubinstein currently serves on the Board of Trustees for The Valerie Fund, a pediatric oncology organization in New Jersey and New York. Ms. Rubinstein holds an MBA from Harvard Business School and dual undergraduate degrees from The Wharton School and Annenberg School of CommunicationsTerms Expiring at the University of Pennsylvania.2025 Annual Meeting Biographies
HarlanChad Robins PhD, co-founded our company in September 2009 and has served as either our Chief ScientificExecutive Officer orand a member of our Headboard of Innovationdirectors since incorporation. Dr. Robins has served in various roles in the Computational Biology Program at Fred Hutchinson Cancer Research Center, including as an Assistant Faculty Member from 2006 to 2011, as an Associate from 2011 to April 2016 and as a Full Member and the Head of the program from April 2016 to June 2019. Dr.Mr. Robins currently serves on the board of directors of CM Life Sciences III, Inc., a public special purpose acquisition company sponsored by affiliates of Casdin Capital, LLC and Corvex Management LP. Dr.Mr. Robins served on the board of directors of ARYA Sciences Acquisition Corp II, a public special purpose acquisition company, from June 2020 to October 2020. Prior to co-founding our company, Mr. Robins held numerous executive-level positions in medical technology, investment and real estate companies. Mr. Robins holds an MBA from The Wharton School at the University of Pennsylvania and a BS in PhysicsManagerial Economics from HarvardCornell University. We believe Mr. Robins is qualified to serve as a member of our board of directors based on our review of his experience, qualifications, attributes and skills, including co-founding our company and his executive leadership experience in the biotechnology industry.
Michael Pellini, MD, has served on our board of directors since February 2018. Dr. Pellini currently serves as a General Partner of Section 32, LLC, a technology and life sciences-based venture capital fund. Dr. Pellini currently serves as a member of the board of directors of the American Cancer Society (a nonprofit organization) and Singular Genomics Systems, Inc. (a public development-stage life sciences company), as well as several private companies. Dr. Pellini previously served as Chairman of the board of directors, Chief Executive Officer and President at Foundation Medicine, Inc., a molecular information company, which was acquired by the Roche Group in 2018. Dr. Pellini holds an MD from Jefferson Medical College, an MBA from Drexel University and an MSa BA in Economics from Boston College. We believe Dr. Pellini is qualified to serve on our board of directors because of his medical and clinical experience in the biotechnology industry.
Class I Directors with Terms Expiring at the 2026 Annual Meeting Biographies
Katey Owen, PhD, has served as a member of our board of directors since March 2021. Dr. Owen joined the Bill and Melinda Gates Foundation, a private foundation with the goal to enhance healthcare and reduce extreme poverty, in 2013 as Deputy Director of Vaccine Development. In 2017, she stepped into the role of Director, Neglected Tropical Diseases. In this role, Dr. Owen holds end-to-end responsibilities for a portfolio of investments with the goal to eliminate tropical diseases from the planet. In addition, Dr. Owen assumed the position of Director, Vaccine Development in November 2022, with responsibility for target selection, development and commercialization focusing on 100+ vaccine candidates. Prior to joining the Gates Foundation, Dr. Owen held roles of increasing responsibility at Merck & Co., including Executive Director, Merck Vaccines, Sr. Director, Merck Manufacturing Division, and Director, Merck Research Laboratories. Dr. Owen holds a PhD in PhysicsMolecular Virology and a BS in Genetic Biology from Purdue University. We believe Dr. Owen is qualified to serve on our board of directors based on her extensive scientific expertise and strategic insights into commercialization and manufacturing at scale.
Robert Hershberg, PhD, MD, has served on our board of directors since February 2013. Dr. Hershberg is currently Chairman and CEO of Hillevax, a position he has held since 2020 and has been a Venture Partner at Frazier Healthcare Partners since March 2020. Formerly, from April 2017 to March 2020, Dr. Hershberg was the executive vice president and head of business development and global alliances at Celgene (acquired by Bristol-Myers Squibb in November 2019). He was employed in positions of ascending responsibility at Celgene since joining the company in 2014, including his role as Chief Scientific Officer from January 2016 to March 2020. Dr. Hershberg previously served in several roles at VentiRx Pharmaceuticals, Inc., a clinical stage biopharmaceutical company, which he co-founded in 2006, and was Chief Executive Officer of VentiRx from
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2012 until the company’s acquisition by Celgene in February 2017. Dr. Hershberg currently serves on the board of directors of Fate Therapeutics, Inc., a public company specializing in cellular immunotherapies, on the board of directors of Recursion Pharmaceuticals, Inc., a public company specializing in drug discovery, and as a clinical faculty member at the University of Washington School of Medicine. Dr. Hershberg holds a PhD in Biology from the University of California, BerkeleySan Diego’s Affiliated PhD Program with the Salk Institute for Biological Studies and an MD and a visiting appointmentBA from the University of California, Los Angeles. We believe Dr. Hershberg is qualified to the California Instituteserve on our board of Technology. Dr. Robins received postdoctoral appointmentsdirectors based on his extensive technical expertise and executive leadership in the particle theory groupbiotechnology industry.
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EXECUTIVE OFFICERS
The following table sets forth certain information about our executive officers:
Name | Age | Position(s) | ||||
Chad Robins | 49 | Chief Executive Officer and Chairman | ||||
Tycho Peterson | 51 | Former Chief Financial Officer(1) | ||||
Kyle Piskel | 40 | Chief Financial Officer | ||||
Sharon Benzeno, PhD | 50 | Chief Commercial Officer, Immune Medicine | ||||
Susan Bobulsky | 43 | Chief Commercial Officer, MRD | ||||
Francis Lo | 43 | Chief People Officer | ||||
Harlan Robins, PhD | 51 | Chief Scientific Officer | ||||
Julie Rubinstein | 52 | President and Chief Operating Officer | ||||
Stacy Taylor | 64 | Senior Vice President, General Counsel and Corporate Secretary | ||||
| (1) | Mr. Peterson was succeeded as Chief Financial Officer by Kyle Piskel in April 2024. |
The following is a biographical summary of the experience of our executive officers, with the exception of Mr. Robins, whose biographical summary is set forth under the caption “Additional Biographical Information about Other Directors Not Standing for Election at this Meeting.”
Tycho Peterson served as our Chief Financial Officer from June 2022 to April 2024. Prior to joining us, Mr. Peterson held roles of increasing responsibility at J.P. Morgan Chase & Co, an investment bank, from May 1999 to June 2022, most recently serving as a Managing Director, Global Equities. Mr. Peterson currently serves on the Weizmann Instituteboard of Sciencedirectors of SomaLogic, Inc., a public clinical diagnostics company. Mr. Peterson holds an MBA and a master’s degree in Israelbiology from the University of Oxford, and a BS in biology from Cornell University.
Kyle Piskel succeeded Tycho Peterson as our Chief Financial Officer as of April 8, 2024. He joined us in September 2015 and has served in various roles of increasing levels of responsibility, including as Interim Chief Financial Officer from February 2022 to June 2022 and Principal Accounting Officer since October 2021. Prior to joining us, Mr. Piskel was an Accounting Manager at Expedia Group from October 2014 to August 2015. Prior to joining Expedia Group, Mr. Piskel was in the Institute for Advanced StudyAssurance services practice at PrincetonErnst and Young, LLP from August 2007 to October 2014. Mr. Piskel is a certified public accountant and holds a BA in Business Administration from Eastern Washington University and a Master of Accountancy from Gonzaga University. At Princeton, Dr. Robins developed bioinformatics algorithms for micro RNA targets and bacterial genome analysis.
Sharon Benzeno, PhD, has served as our Chief Commercial Officer, Immune Medicine since April 2022. Before this, she served as Chief Business Development Officer from April 2020 to April 2022, Senior Vice President, Drug Discovery from February 2018 to April 2020 and in business development roles of ascending responsibility from September 2014 to February 2018. Prior to joining us, Dr. Benzeno served as Senior Director at Elsevier Inc., a healthcare informatics company, from December 2013 to September 2014, as Senior Manager in the oncology business unit at Capgemini SE, a French consulting and technology services company, from May 2011 to December 2013, and as Oncology Alliance Manager and Senior Scientific Manager at AstraZeneca plc from September 2005 to May 2011. Dr. Benzeno holds a PhD in Biomedical Sciences from New York University School of Medicine, an MBA in Finance and Leadership from New York University Stern School of Business and a BA in Biochemistry from New York University. Dr. Benzeno completed a postdoctoral fellowship in cancer biology at the University of Pennsylvania Abramson Cancer Center.
Nitin Sood Susan Bobulskyhas served as our Chief Commercial Officer, MRD, since April 2022,January 2024. Before this, she served in commercial and prior to that, served as Chief Commercial Officer from August 2021 to April 2022.strategic planning roles of ascending responsibility since joining Adaptive in September 2014. Prior to joining us, Mr. SoodAdaptive, Ms. Bobulsky was Senior Vice President at Guardant Healthan Associate Principal with ZS Associates, a healthcare management consulting firm, where she worked for nine years specializing in commercialization
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strategy and execution for therapeutic and diagnostic products. Ms. Bobulsky holds an MBA from July 2019 to July 2021. Mr. Sood served as GMthe Stanford Graduate School of Tecan Genomics from September 2018 to March 2019. From June 2016 to September 2018, Mr. Sood was Chief Executive officer of NuGEN, a leader in NGS sample prep, where he led NuGEN’s successful acquisition by Tecan AG in September 2018. Mr. Sood’s experience also includes leading global businesses at Perkin Elmer and Agilent Technologies where he held General Manager roles spanning a portfolio of products in genomics, pathology, imaging and automation. Mr. Sood holds a master’s degree in computer science from Ball State UniversityBusiness and a master’s degreeBS in molecular biologyScience, Technology and Society from DelhiStanford University.
Kyle Piskel has served as our Chief Financial Officer since February 2022. He has also served as our Principal Accounting Officer since October 2021 after serving in various roles of increasing levels of responsibility, including Corporate Controller, since joining us in September 2015. Prior to joining us, Mr. Piskel was an Accounting Manager at Expedia Group from October 2014 to August 2015. Prior to joining Expedia Group, Mr. Piskel was in the Assurance services practice at Ernst and Young, LLP from August 2007 to October 2014. Mr. Piskel is a certified public accountant and holds a BA in Business Administration from Eastern Washington University and a Master of Accountancy from Gonzaga University.
Mark Adams, PhD, has served as our Chief Operating Officer since January 2021. Prior to his appointment as Chief Operating Officer, Dr. Adams served as our Chief Technical Officer from April 2020 to January 2021. Prior to joining us, Dr. Adams served as Managing Director of SVB Leerink, a health and life-sciences focused investment bank, from April 2018 to March 2020. Before joining SVB Leerink, from September 2016 to April 2018, he served as Chief Information Officer for Celmatix, Inc., a biotechnology company specializing in reproductive health, and from September 2013 to April 2016, he served as Chief Information Officer for Good Start Genetics, a molecular genetic information company. His other experience includes work developing unique data warehousing and machine learning approaches and the development of a leading biomedical informatics consulting practice. Dr. Adams holds a B.A. from Oberlin College and a PhD from Baylor College of Medicine.
Francis Lohas served as our Chief People Officer since May 2019. Prior to joining us, from March 2017 to April 2019, Mr. Lo served as Vice President, Human Resources at Whole Foods Market, Inc., an operator of natural and organic food supermarkets. From August 2011 to March 2017, Mr. Lo also served in various roles of ascending responsibility with Starbucks Corporation, a public specialty coffee company, including as Director, Global Talent Management from October 2015 to March 2017. Mr. Lo holds an MBA in Business Administration from Stanford University Graduate School of Business and a BA in the Plan II Honors Program (Interdisciplinary Studies with Business Focus) from the University of Texas at Austin.
Harlan Robins, PhD, co-founded our company in September 2009 and has served as either our Chief Scientific Officer or our Head of Innovation since incorporation. Dr. Robins has served in various roles in the Computational Biology Program at Fred Hutchinson Cancer Research Center, including as an Assistant Faculty Member from 2006 to 2011, as an Associate from 2011 to April 2016 and as a Full Member and the Head of the program from April 2016 to June 2019. Dr. Robins currently serves on the board of directors of CM Life Sciences III, Inc., a public special purpose acquisition company sponsored by affiliates of Casdin Capital, LLC. and Corvex Management LP. Dr. Robins holds a BS in Physics from Harvard University and an MS and PhD in Physics from the University of California, Berkeley with a visiting appointment to the California Institute of Technology. Dr. Robins received postdoctoral appointments in the particle theory group at the Weizmann Institute of Science in Israel and at the Institute for Advanced Study at Princeton University. At Princeton, Dr. Robins developed bioinformatics algorithms for micro-RNA targets and bacterial genome analysis.
Julie Rubinstein has served as our President since February 2018 and assumed a strategic operating role as Chief Operating Officer in April 2023. Previously at Adaptive, Ms. Rubinstein served as our Chief Business Officer from January 2016 to February 2018, and our head of Corporate and Business Development from April 2011 to January 2016. Prior to joining us, Ms. Rubinstein held various worldwide commercial development roles at Pfizer Inc.’s Oncology division, primarily focusing on cancer immunotherapy. She also served in various roles with Johnson & Johnson Services, Inc., including in Europe. Ms. Rubinstein currently serves on the Board of Trustees for The Valerie Fund, a pediatric oncology organization in New Jersey and New York. Ms. Rubinstein holds an MBA from Harvard Business School and dual undergraduate degrees from The Wharton School and Annenberg School of Communications at the University of Pennsylvania.
Stacy Taylor has served as our Senior Vice President, General Counsel since March 2019, and before that, in our legal department in roles of ascending responsibility since March 2018. Prior to joining us, Ms. Taylor served as Senior Associate General Counsel for BTG International plc, a global specialist healthcare company, from July 2017 to March 2018. Prior to joining BTG, Ms. Taylor was a partner at the law firm of DLA Piper LLP (US) from 2007 to 2017, and prior to that practiced intellectual property law in private practice from 1985 to 2007. Ms. Taylor holds a JD from California Western School of Law and a BS in Biological Sciences, Anatomy and Physiology from California Polytechnic State University at San Luis Obispo.
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| Harlan Robins, PhD | Chief Scientific Officer | |
| Julie Rubinstein | President and Chief Operating Officer |
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Selected 2021 Corporate Performance Highlights & Reorganization
Recently, we began a reorganization of our business into two different key business areas: MRD and immune medicine. The MRD business is comprised primarily of the clonoSEQ diagnostic test offered to clinicians and the clonoSEQ assay offered to pharmaceutical partners to support drug development and approvals. Selected highlights of the MRD business include:
Our clinical diagnostics business continued to grow year over year. For our clonoSEQ product, we grew our test volume by 48% to 22,516 tests delivered in the year ended December 31, 2021. We increased the all-time number of unique patients tested by more than 46% to over 22,000 patients by the end of 2021.
We filed to expand our existing label for ALL in bone marrow to include blood, and we enhanced the clinical report for CLL patients to include immunoglobulin heavy chain – V (“IGHV”) mutation status, whichexecutive compensation structure has been well received by our clinical customers.
Our other key business area, immune medicine, is comprised of our research, diagnostic, and drug discovery products and services driven by T-cell mapping efforts in partnership with Microsoft. The immune medicine portfolio currently includes immunoSEQ, T-Detect, and drug discovery collaborations with Genentech, Inc. (“Genentech”) and Nykode Therapeutics AS (“Nykode”). Selected highlights of the immune medicine business include:
In March 2021, T-Detect COVID was granted Emergency Use Authorization by the Food and Drug Administration, becoming the first-in-class test to confirm recent or prior COVID-19 infection. Data demonstrates that T-Detect COVID can detect prior infection nearly 12 months after diagnosis in some patients. T-Detect COVID was ordered by over 30,000 consumers and providers on behalf of their patients.
In drug discovery, we continued to make good progressappropriately aligned realizable pay with our shared and private product programs under our Genentech collaboration and extended our drug discovery efforts in a collaboration with Nykode to informperformance over the design and development of novel SARS-CoV-2 vaccine candidates.
| ( 1 ) | Target pay is defined as target equity grant value, “Target Annual Incentive Opportunity” as reported in the “ Incentive Compensation and 2023 Goals Achievement Summary Compensation Table Summary Compensation Table |
Our executive compensation program is broadly designed to be reasonable and competitive, and is designed to attract, motivate, reward and retain top-performing senior executives with the goal of aligning their interests with those of our shareholders. Our compensation committee annually evaluates our executive compensation program to ensure that it is consistent with our short-term and long-term goals and the dynamic nature of our business.
Our executive compensation program consists of a mix of compensation elements that balance achievement of our short-term goals with our long-term performance. We provide short-term incentive compensation opportunities in the form of annual cash incentives, which focus on our achievement of annual corporate goals. We also provide long-term incentive compensation opportunities in the form of equity awards. In recognition of our growth as a public company and evolving talent needs, we introduced RSUs to our 2021 long-term incentive program, which has previously solely consisted of stock options. The introduction of RSUs is intended to differentiate our company in the marketplace—we believe that RSUs reward growth in the market price of our common stock because their value is tied to the market value of our common stock while being less dilutive to our shareholders than a similar grant date fair value award of options. In addition, we believe that RSUs increase the overall engagement with our employee population and talent pool through the linkage to the stock price and multi-year vesting period attached to the RSUs.
To that end, in 2022,Our compensation mix balances the compensation committee undertook a holistic assessmentachievement of our currentshort-term goals with our long-term performance and attracts, motivates, rewards and retains top-performing senior executives.
Element of Pay | Base Salary | Annual Incentive Program | Long-Term Incentive Program | |||
Why It Is Provided | Base level of compensation for carrying out day-to-day responsibilities | Incentivizes delivery of corporate goals that position the Company for future growth and allows for an assessment of individual contributions to intra-year results | Incentivizes sustainable long- term company growth Aligns executives with shareholder experience and ties compensation more closely to performance for Mr. Robins and Dr. Robins and, in 2024, for Ms. Rubinstein and our Chief Financial Officer (including our internally promoted Chief Financial Officer), as well. Annual target LTI levels can reflect role-based market dynamics and individual contributions. | |||
Fixed Pay or Variable Pay | Fixed | Variable | Variable | |||
Company rTSR (as a percentile of index TSR) | Shares Earned as Percent of Target | |||
Below 33 rd Percentile | 0 | % | ||
33 rd Percentile | 50 | % | ||
50 th Percentile | 100 | % | ||
75 th Percentile and Above | 200 | % | ||
Vehicle | Percentage of Long-Term Pay | Target Grant Value | Number of Units | |||||||||
| RSUs . . . . . . . . . . | 50 | % | $ | 3,000,000 | 354,610 | |||||||
| PSUs . . . . . . . . . . . | 50 | % | $ | 3,000,000 | 354,610 | |||||||
Company rTSR (as a percentile of index TSR) | % Multiplier (applied to the target number of PSUs) | Payout Level for 2022 PSU Award | Payout Level for 2023 PSU Award | |||||||||
| Less than 33% | 0 | % | — | — | ||||||||
| 33% (Threshold) | 50 | % | 123,558 | 177,305 | ||||||||
| 50% (Target) | 100 | % | 247,117 | 354,610 | ||||||||
| 75% (Maximum) | 200 | % | 494,234 | 709,220 | ||||||||
We emphasize pay-for-performance by placing a majority of each named executive officer’s total compensation “at risk” through the annual incentive and long-term incentive plans. Total compensation includes the sum of the named executive officer’s base salary, target annual incentive opportunity and target long-term compensation opportunity. The chart below shows the mix of fixed (base salary, as measured at year-end) and at-risk compensation (annual incentives and equity awards) of our named executive officers in 2021:
As noted above, in 2022, the PSU Award was made to Mr. Robins in lieu of an annual stock option grant in order to strengthen the link between our stock performance relative to its peers and Mr. Robins’ compensation, with shares to be earned based on our total shareholder return (“TSR”) relative to an industry index over a three-year performance period.
Compensation Program Governance and Process
The compensationhuman capital committee assesses the effectiveness of our executive compensation program from time to time and reviews risk mitigation and governance matters. The compensation and human capital committee, during its first meeting of the year, addresses achievementsachievement of the prior year’s corporate goals for purposes of determining annual cash incentives. Following that, most of the significant adjustments to compensation are made to base salary, annual cash incentive and equity awards at the compensation and human capital committee’s second meeting of the year, typically held during the first quarter.
Compensation Risk Considerations
From a risk management standpoint, compensation structure is designed to align all Adaptive employees (including executive officers) with shareholders, with a similar risk and reward structure. With respect to our annual cash incentive plan compensation, risk is managed through a balancing of individual and corporate goals, with those corporate goals in turn being balanced among financial, operational, and milestone achievements. Regarding equity compensation, we believe that RSUs have a powerful retention effect, and stock option awards allow employees to participate in significant upside on a leveraged basis over the long term. The compensation committee reviews and discusses with management on an ongoing basis the risks arising from our compensation philosophy and practices generally applicable to our employees to determine whether they encourage excessive risk-taking and to evaluate compensation policies and practices that could mitigate such risks. There is ongoing dialogue regarding the risk and reward alignment of our executive compensation. During 2021, management, supplemented by data from Semler Brossy Consulting Group, LLC (“Semler Brossy”), conducted an assessment of our compensation policies and practices and determined current practices were not reasonably likely to have a material adverse effect.
providedProvided a review and recommendation with respect to adjustments to our peer group;
conductedConducted a competitive benchmarking assessment comprised of comparative data on the compensation levels for our executive compensation and equity usage based on the peer group; and
providedProvided information on executive compensation trends and practices in our industry.
The compensation and human capital committee initially referenced data from the following peer group companies when considering pay for 2021:
| 10X Genomics, Inc. | Guardant Health, Inc. | Natera, Inc. | ||
| Allogene Therapeutics, Inc. | Halozyme Therapeutics, Inc. | NeoGenomics Laboratories, Inc. | ||
| bluebird bio, Inc. | Invitae Corporation | Sage Therapeutics, Inc. | ||
| Blueprint Medicines Corporation | Immunocore Holdings plc | Twist Biosciences Corporation | ||
| BridgeBio Pharma, Inc. | ImmunityBio, Inc. | Veracyte, Inc. | ||
| CareDx, Inc. | Myriad Genetics, Inc. | |||
| Fate Therapeutics, Inc.
| NanoString Technologies, Inc. |
| ||
| ||||
| ||||
| ||||
| ||||
| ||||
Following a 2021 review of the peer group, the compensation committee removed Genmark Diagnostics, Inc. given its acquisition and Moderna, Inc. due to its size relative to Adaptive.
For 2022, the compensationhuman capital committee targeted the median percentile for base salary and bonus while targeting the 75thrange between the median and the 75th percentile for equity compensation, in order to increase the amount of at-risk compensation for executive officers and further align shareholders and executive officers.
However, an executive officer’s established target pay level could be positioned above or below these market levels based on individual factors, including but not limited to tenure in role, performance in role, company or business area performance and future leadership potential.
Category Revenue (40%) $ 205 million $ 170.3 million Not Achieved 0 % Operating Expense Reduction (30%) $ 380 million $
371.9 million
Achieved 30 % Diagnostic and Clinical Pipelines Qualitative Assessment Achieved 15 % Qualitative Assessment Achieved 2 of 3
15 % (1) There was an additional 10% kicker for employee engagement that was not achieved and had no payout. (2) The threshold revenue goal was $205 million and the maximum goal was $235 million. Achievement at threshold and maximum together with the targeted reduction of operating expenses would have resulted in payouts for the financial component of 70% and 150%, respectively. (3) Operating expenses were evaluated excluding a $25.4 million impairment of right-of-use and related long-lived assets related to one of our idle facilities. (4) A third goal was deferred with approval from our board of directors to focus the business efforts on near-term goals; credit was given for overall achievement of this goal. 2021, no named executive officer’s individual goals were funded above 100%. Performance2023, performance against the 2021 corporate goals was mixed, with the company exceedingachieving the target performance level for certain goals andwhile falling below in revenue. In lightshort of several strategic performance achievements which added additional enterprise value, including stronger than expected performanceothers (relating principally to reduction in pharmaceutical bookings, potential business related tocustomer spend and refocusing of immune medicine goals on target discovery). Overall corporate goal achievement was at 60% of goal, as noted in the correlatepreceding table.
Named Executive Officers |
| 2021 Target Annual Incentive (% of Salary) |
|
| 2021 Target Annual Incentive Opportunity ($) |
|
| 2021 Annual Incentive Award Earned ($) |
|
| 2021 Actual Incentive Award Earned (% of Target) |
| ||||
Chad Robins |
|
| 80 |
|
|
| 515,000 |
|
|
| 463,500 |
|
|
| 90.0 |
|
Chad Cohen |
|
| 50 |
|
|
| 216,250 |
|
|
| 200,031 |
|
|
| 92.5 |
|
Harlan Robins, PhD |
|
| 50 |
|
|
| 257,500 |
|
|
| 238,188 |
|
|
| 92.5 |
|
Julie Rubinstein |
|
| 50 |
|
|
| 257,500 |
|
|
| 238,188 |
|
|
| 92.5 |
|
Nitin Sood(1) |
|
| 50 |
|
|
| 94,521 |
|
|
| 87,432 |
|
|
| 92.5 |
|
Named Executive Officers | 2023 Target Annual Incentive (% of Salary) | 2023 Target Annual Incentive Opportunity ($) | 2023 Annual Incentive Award Earned ($) | 2023 Actual Incentive Award Earned (% of Target) | ||||||||||||
| Chad Robins | 80 | 530,400 | 318,240 | 60 | ||||||||||||
| Tycho Peterson | 50 | 212,500 | 135,469 | 64 | ||||||||||||
| Sharon Benzeno, PhD | 50 | 237,500 | 151,406 | 64 | ||||||||||||
| Harlan Robins, PhD | 50 | 265,225 | 175,712 | 66 | ||||||||||||
| Julie Rubinstein | 50 | 265,225 | 185,658 | 70 | ||||||||||||
|
|
For 2022, goals were again a weighted mix of corporate goals and individual goals. Our corporate goals include overall financial achievements related to revenue and cash preservation, enterprise achievement in pharmaceutical bookings, as well as advancements in both MRD and immune medicine. In light of the company’s 2022 reorganization and reduced headcount, the compensation committee also recognized the importance of focusing on employee engagement and agreed to an additional goal related to achievement of certain employee engagement metrics. As a percentage of salary, the target annual incentive was set at 80% for Mr. Robins and 50% for the other named executive officers.
Other than Performance Stock Units
In 2021, the compensation committee added RSUs to the equity pay mix for our executive officers. The committee believes that this addition will further align the interests of our executives with those of our shareholders, help us to attract and retain top talent and further foster an ownership culture among our employees.
2023.
reconfigured to include PSUs in lieu of stock options. Key terms
Performance period: March 4, 2022 to March 4, 2025 (“Performance Period”)
Target number of shares: 247,117
Target economic value: $3,000,000 (equivalent to 50% of the annual target economic value of Mr. Robins’ long-term equity compensation)
The shares of common stock that may be earned under the PSU Award are calculated based upon our TSR (“Company rTSR”) during the performance30-day period as measured against the total shareholder return of the group of companies comprising the S&P Biotechnology Select Industry Index as of the date of grant, subject to certain adjustments to such index group (the “index TSR”) as set forth in the Form of Performance Units Agreement representing the PSU Award (the “PSU Award Agreement”). Company rTSR and index TSR are each calculated as set forth in the PSU Award Agreement. Achievement between the threshold and maximum percentiles will be interpolated on a straight-line basis. The compensation committee may not apply upward discretionended immediately prior to the number of shares earned. Ifdetermination date, to be the threshold percentile is not achieved the PSUs shall be forfeited, and no more than the maximum number of shares may be earned, and if the Company rTSR is negative, Mr. Robins cannot earn more than the target number of shares.
Group | Required Multiple | Multiple Definition | |||||
|
|
| |||||
|
|
| |||||
|
|
| |||||
|
|
| |||||
The PSU Award was designed to tie Mr. Robins’ compensation directly to shareholder return relative to our peers as opposed to compensating raw increases in stock price that may be primarily driven by external or sector-based events. We believe the decision to grant Mr. Robins the PSU Award represents an important advance in our pay-for-performance philosophy.
In 2012, we adopted
first quarter of 2023.
Compensation Risk Considerations
We present below the ratio of annual total compensation of our median compensated employee to the annualized total compensation of Chad Robins, our Chief Executive Officer, calculated in accordance with Item 402(u) of Regulation S-K.
In identifying our median employee, we reviewed the compensation of our entire employee population of approximately 865 U.S. employees as of December 31, 2021, excluding all five of our non-U.S. employees (of which 2 are located in Germany, 2 in France and 1 in United Kingdom). In performing this analysis, we identified the median employee based on annual base salary rate and target bonus as of December 31, 2021 plus grant date fair value of all equity awards granted in 2021. For purposes of the calculation, overtime paid in 2021 was annualized and added to the annual base salary amount. The median employee identified was not employed with us for the entire twelve-month period, so the employee directly underneath was selected instead. After identifying the median employee, we then determined the annual base salary earned in 2021 and the cash bonus for 2021 (paid in 2022), as well as other benefits such as 401(k) matching, utilizing the same method used to calculate and report Mr. Robins’ compensation.
The 2021 total compensation for Mr. Robins, as reported below in the ‘‘Summary Compensation Table’’ was 8,751,617, which reflects all elements of his compensation as determined under Item 402 of Regulation S-K. The 2021 annual total compensation as determined under Item 402 of Regulation S-K for our median employee, who is employed as our Data Scientist II, was $167,834. The ratio of Mr. Robins’ total compensation to our median employee’s total annual compensation for 2021 is 52 to 1.
Kevin Conroy
Katey Owen, PhD
Name and Principal Position |
| Year |
|
|
| Salary(1) ($) |
|
|
|
Stock Awards(2) ($) |
| Option |
|
| Non-Equity |
|
All Other Compensation ($) |
|
| Total ($) |
| |||||
Chad Robins Chief Executive Officer and Chairman |
|
| 2021 |
|
|
|
| 639,063 492,555 |
|
|
| 2,999,986 — — |
|
| 4,592,798 |
|
|
| 463,500 385,950 |
| 56,270 20,098 | (5) (6)
|
|
| 8,751,617 2,856,181 |
|
Chad Cohen |
|
| 2021 |
|
|
|
| 429,375 411,950 381,413 |
|
|
| 899,983 — — |
|
| 1,377,842 1,703,859 554,714 |
|
|
| 200,031 210,000 193,900 |
| 4,608 3,943 | (7) (8) |
|
| 2,911,839 2,329,752 1,130,027 |
|
Harlan Robins, PhD Chief Scientific Officer |
|
| 2021 |
|
|
|
| 511,250 |
|
|
| 2,999,986 — — |
|
| 4,592,798 |
|
|
| 238,188 |
| 4,260 3,900 | (9) (10) |
|
| 8,346,482 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Julie Rubinstein |
|
| 2021 |
|
|
|
| 511,250 481,100 |
|
|
| 2,000,020 — — |
|
| 3,061,874 |
|
|
| 238,188 250,000 |
| 4,607 3,675 | (11) (12) |
|
| 5,815,939 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nitin Sood Chief Commercial Officer, MRD |
|
| 2021 |
|
|
|
| 187,833
|
|
|
| 2,999,993 |
|
| 3,113,382
|
|
|
| 87,432 | (13) | 630
| (14)
|
|
| 6,389,270 |
|
Name and Principal Position | Year | Salary ($) | Stock Awards (1) ($) | Option Awards (2) ($) | Non-Equity Incentive Plan Compensation (3) ($) | All Other Compensation ($) | Total ($) | |||||||||||||||||||||
| Chad Robins | 2023 | 663,000 | (4) | 7,900,711 | — | 318,240 | 22,316 | (5) | 8,904,267 | |||||||||||||||||||
Chief Executive Officer and Chairman | 2022 | 658,188 | 7,668,040 | — | 450,840 | 76,260 | (6) | 8,853,328 | ||||||||||||||||||||
| 2021 | 639,063 | 2,999,986 | 4,592,798 | 463,500 | 56,270 | (7) | 8,751,617 | |||||||||||||||||||||
| Tycho Peterson | 2023 | 425,000 | (4) | 999,997 | 999,998 | 135,469 | 4,932 | (8) | 2,565,396 | |||||||||||||||||||
Former Chief Financial Officer | 2022 | 247,917 | 2,735,222 | 2,840,318 | 110,573 | 4,227 | (9) | 5,938,257 | ||||||||||||||||||||
| Sharon Benzeno, PhD | 2023 | 475,000 | (4) | 1,125,002 | 1,124,997 | 151,406 | 4,316 | (10) | 2,880,721 | |||||||||||||||||||
Chief Commercial Officer, IM | 2022 | 456,250 | 999,996 | 1,566,497 | 210,781 | 4,260 | (11) | 3,237,784 | ||||||||||||||||||||
| Harlan Robins, PhD | 2023 | 530,450 | (4) | 7,900,711 | — | 175,712 | 4,932 | (8) | 8,611,805 | |||||||||||||||||||
Chief Scientific Officer | 2022 | 526,588 | 3,000,000 | 4,699,482 | 228,757 | 4,260 | (11) | 8,459,087 | ||||||||||||||||||||
| 2021 | 511,250 | 2,999,986 | 4,592,798 | 238,188 | 4,260 | (11) | 8,346,482 | |||||||||||||||||||||
| Julie Rubinstein | 2023 | 530,450 | (4) | 1,125,002 | 1,124,997 | 185,658 | 4,932 | (8) | 2,971,039 | |||||||||||||||||||
President and Chief Operating Officer | 2022 | 526,588 | 2,250,003 | 3,524,611 | 228,757 | 5,119 | (12) | 6,535,078 | ||||||||||||||||||||
| 2021 | 511,250 | 2,000,020 | 3,061,874 | 238,188 | 4,607 | (13) | 5,815,939 | |||||||||||||||||||||
(1) |
|
| In accordance with SEC rules, amounts in this column reflect the aggregate grant date fair value of RSUs and PSUs granted computed in accordance with ASC 718, rather than the amounts paid or realized by the named individual. We provide information regarding the assumptions used to calculate the grant date fair value of our RSUs and PSUs in Note |
| In accordance with SEC rules, amounts in this column reflect the aggregate grant date fair value of stock options granted computed in accordance with ASC 718, rather than the amounts paid or realized by the named individual. We provide information regarding the assumptions used to calculate the grant date fair value of our stock options in Note |
| For 2023, represents annual incentives paid based upon the board of directors’ assessment of the achievement of corporate and individual performance objectives, as applicable, for the year ended December 31, 2023, which were paid in March 2024. See “ Elements of Executive Compensation |
| (4) | Following the completion of our annual performance and review cycle, no named executive officers received an increase in base salary for |
| (5) | Includes life insurance premiums of |
| (6) | Includes life insurance premiums of |
| Includes life insurance premiums of $1,260, company merchandise credit of $10, 401(k) match of $3,000 and transportation services of $52,000. |
| Includes life insurance premiums of |
| Includes life insurance premiums of |
| Includes life insurance premiums of |
| Includes life insurance premiums of $1,260 and 401(k) match of $3,000. |
| Includes life insurance premiums of |
| Includes life insurance premiums of $1,587, |
|
|
|
|
|
|
|
|
|
| Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) |
|
| All Other Stock Awards: Number of Shares of Stock or |
|
| All Other Option Awards: Number of Securities Underlying |
|
| Exercise or Base Price of Option |
|
| Grant Date Fair Value of Stock and Option |
| |||||||||||||
Name |
| Grant Date |
| Threshold ($) |
|
| Target(2) ($) |
|
| Maximum(3) ($) |
|
| Units (#) |
|
| Options (#) |
|
| Awards ($/share) |
|
| Awards(4) ($) |
| |||||||
Chad Robins |
| 3/4/2021(5) |
|
| — |
|
|
| 515,000 |
|
|
| — |
|
|
| 68,681 |
|
|
| 171,703 |
|
|
| 43.68 |
|
|
| 7,592,784 |
|
Chad Cohen |
| 3/4/2021(5) |
|
| — |
|
|
| 216,250 |
|
|
| — |
|
|
| 20,604 |
|
|
| 51,511 |
|
|
| 43.68 |
|
|
| 2,277,825 |
|
Harlan Robins, PhD |
| 3/4/2021(5) |
|
| — |
|
|
| 257,500 |
|
|
| — |
|
|
| 68,681 |
|
|
| 171,703 |
|
|
| 43.68 |
|
|
| 7,592,784 |
|
Julie Rubinstein |
| 3/4/2021(5) |
|
| — |
|
|
| 257,500 |
|
|
| — |
|
|
| 45,788 |
|
|
| 114,469 |
|
|
| 43.68 |
|
|
| 5,061,894 |
|
Nitin Sood |
| 8/16/2021(5) |
|
| — |
|
|
| 94,521 |
|
|
| — |
|
|
| 97,213 |
|
|
| 162,022 |
|
|
| 30.86 |
|
|
| 6,113,376 |
|
Estimated Future Payouts Under Non- Equity Incentive Plan Awards (1) | ||||||||||||||||||||||||||||||||
Name | Grant Date | Threshold ($) | Target (2) ($) | Maximum (3) ($) | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/Share) | Grant Date Fair Value of Stock and Option Awards (4) ($) | ||||||||||||||||||||||||
| Chad Robins | 3/6/2023 | (5) | — | 530,400 | — | 709,220 | (6) | — | — | 7,900,711 | ||||||||||||||||||||||
| Tycho Peterson | 3/6/2023 | (7) | — | 212,500 | — | 118,203 | 177,377 | 8.46 | 1,999,996 | |||||||||||||||||||||||
| Sharon Benzeno, PhD | 3/6/2023 | (7) | — | 237,500 | — | 132,979 | 199,549 | 8.46 | 2,250,000 | |||||||||||||||||||||||
| Harlan Robins, PhD | 3/6/2023 | (5) | — | 265,225 | — | 709,220 | (6) | — | — | 7,900,711 | ||||||||||||||||||||||
| Julie Rubinstein | 3/6/2023 | (7) | — | 265,225 | — | 132,979 | 199,549 | 8.46 | 2,250,000 | |||||||||||||||||||||||
|
|
(2) | Target funding for non-equity incentive plan assumes 100% achievement of both corporate and individual |
| (3) | The target bonus for each executive is divided between an Individual and |
|
|
(4) | In accordance with SEC rules, amounts in this column reflect the aggregate grant date fair value of RSUs, target number of PSUs and stock options granted, as applicable, computed in accordance with ASC 718, rather than the amounts paid or realized by the named individual. We provide information regarding the assumptions used to calculate the grant date fair value of our RSUs, PSUs and stock options in Note |
(5) | Grant is comprised of time-vested RSUs and PSUs. A description of the PSU award granted is provided above in the CD&A under “ Executive Compensation Design and Philosophy |
| (6) | Includes the target number of PSUs awarded, but up to 200% of target may be earned. |
| (7) | Grant is comprised of time-vested RSUs and stock options. Mr. Peterson’s unvested equity awards were forfeited upon his departure from the Company. |
| | | Option Awards | | | Stock Awards | ||||||
Name | | | Number of Shares Acquired on Exercise (#) | | | Value Realized on Exercise(1) ($) | | | Number of Shares Acquired on Vesting (#) | | | Value Realized on Vesting ($) |
Chad Robins | | | — |
|
| — |
|
| — |
|
| — |
Chad Cohen | | | 584,375 |
|
| 28,882,270 |
|
| — |
|
| — |
Harlan Robins, PhD | | | 278,790 |
|
| 12,829,990 |
|
| — |
|
| — |
Julie Rubinstein | | | 584,675 |
|
| 31,964,584 |
|
| — |
|
| — |
Nitin Sood | | | — |
|
| — |
|
| — |
|
| — |
Option Awards | Stock Awards | |||||||||||||||
Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise (1) ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting (2) ($) | ||||||||||||
| Chad Robins | — | — | 78,949 | 716,857 | ||||||||||||
| Tycho Peterson | 149,289 | 130,809 | 93,672 | 660,388 | ||||||||||||
| Sharon Benzeno, PhD | — | — | 26,316 | 238,949 | ||||||||||||
| Harlan Robins, PhD | — | — | 78,949 | 716,857 | ||||||||||||
| Julie Rubinstein | — | — | 57,781 | 524,651 | ||||||||||||
(1) | The value realized on exercise represents the difference between the exercise price and the sale price of the shares on the date of exercise. |
| (2) | The value realized on vesting represents the closing price of our common stock on the vesting date multiplied by the shares vesting. |
36
2023
|
| Option Awards |
|
|
|
|
|
| Stock Awards |
| ||||||||||||||||
Name |
| Grant Date |
| Number of Securities Underlying Unexercised Options Exercisable (#) |
|
| Number of Securities Underlying Unexercised Options Unexercisable (#) |
|
| Option Exercise Price ($) |
|
| Option Expiration Date |
|
| Number of Shares or Units of Stock That Have Not Vested (#) |
|
| Market Value of Shares or Units of Stock That Have Not Vested(10) ($) |
| ||||||
Chad Robins(1) |
| 6/9/2015 |
| 800,000(2) |
|
|
| — |
|
|
| 6.32 |
|
| 6/9/2025 |
|
|
| — |
|
|
| — |
| ||
Chief Executive Officer and |
| 2/7/2018 |
| 600,000(2) |
|
|
| — |
|
|
| 6.55 |
|
| 2/7/2028 |
|
|
| — |
|
|
| — |
| ||
Chairman |
| 2/7/2019 |
| 298,958(3) |
|
|
| 111,042 |
|
|
| 7.27 |
|
| 2/7/2029 |
|
|
| — |
|
|
| — |
| ||
|
| 2/13/2020 |
| 137,500(4) |
|
|
| 162,500 |
|
|
| 31.71 |
|
| 2/13/2030 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| —(5) |
|
|
| 171,703 |
|
|
| 43.68 |
|
| 3/4/2031 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| — |
|
|
| — |
|
|
| — |
|
| — |
|
|
| 68,681(6) |
|
|
| 1,927,189 |
| ||
Chad Cohen(1) |
| 8/25/2015 |
| 25,000(2) |
|
|
| — |
|
|
| 6.32 |
|
| 8/25/2025 |
|
|
| — |
|
|
| — |
| ||
Chief Financial Officer |
| 2/7/2018 |
| 65,625(2) |
|
|
| — |
|
|
| 6.55 |
|
| 2/7/2028 |
|
|
| — |
|
|
| — |
| ||
|
| 2/7/2019 |
| 48,854(3) |
|
|
| 31,146 |
|
|
| 7.27 |
|
| 2/7/2029 |
|
|
| — |
|
|
| — |
| ||
|
| 2/13/2020 |
| 38,958(4) |
|
|
| 46,042 |
|
|
| 31.71 |
|
| 2/13/2030 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| —(5) |
|
|
| 51,511 |
|
|
| 43.68 |
|
| 3/4/2031 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| — |
|
|
| — |
|
|
| — |
|
| — |
|
|
| 20,604(6) |
|
|
| 578,148 |
| ||
Harlan Robins, PhD(1) |
| 6/9/2015 |
| 70,110(2) |
|
|
| — |
|
|
| 6.32 |
|
| 6/9/2025 |
|
|
| — |
|
|
| — |
| ||
Chief Scientific Officer |
| 2/7/2018 |
| 284,800(2) |
|
|
| — |
|
|
| 6.55 |
|
| 2/7/2028 |
|
|
| — |
|
|
| — |
| ||
|
| 2/7/2019 |
| 298,958(3) |
|
|
| 111,042 |
|
|
| 7.27 |
|
| 2/7/2029 |
|
|
| — |
|
|
| — |
| ||
|
| 2/13/2020 |
| 137,500(4) |
|
|
| 162,500 |
|
|
| 31.71 |
|
| 2/13/2030 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| —(5) |
|
|
| 171,703 |
|
|
| 43.68 |
|
| 3/4/2031 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| — |
|
|
| — |
|
|
| — |
|
| — |
|
|
| 68,681(6) |
|
|
| 1,927,189 |
| ||
Julie Rubinstein (1) |
| 2/7/2018 |
| 195,325(2) |
|
|
| — |
|
|
| 6.55 |
|
| 2/7/2028 |
|
|
| — |
|
|
| — |
| ||
President |
| 2/7/2019 |
| 164,062(3) |
|
|
| 60,938 |
|
|
| 7.27 |
|
| 2/7/2029 |
|
|
| — |
|
|
| — |
| ||
|
| 2/13/2020 |
| 91,666(4) |
|
|
| 108,334 |
|
|
| 31.71 |
|
| 2/13/2030 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| —(5) |
|
|
| 114,469 |
|
|
| 43.68 |
|
| 3/4/2031 |
|
|
| — |
|
|
| — |
| ||
|
| 3/4/2021 |
| — |
|
|
| — |
|
|
| — |
|
| — |
|
|
| 45,788(6) |
|
|
| 1,284,811 |
| ||
Nitin Sood(1) |
| 8/16/2021 |
| —(7) |
|
|
| 162,022 |
|
|
| 30.86 |
|
| 8/16/2031 |
|
|
| — |
|
|
| — |
| ||
Chief Commercial Officer, MRD |
| 8/16/2021 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
| 64,809(8) |
|
|
| 1,818,541 |
| |
|
| 8/16/2021 |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
| 32,404(9) |
|
|
| 909,256 |
| |
(1) Option Awards Stock Awards Name
Options 6/9/2015 755,555 (3) — 6.32 6/9/2025 — — 2/7/2018 600,000 (3) — 6.55 2/7/2028 — — 2/7/2019 410,000 (3) — 7.27 2/7/2029 — — 2/13/2020 287,500 (4) 12,500 31.71 2/13/2030 — — 3/4/2021 118,045 (5) 53,658 43.68 3/4/2031 34,341 (6) 168,271 3/4/2022 — — — — 432,455 (7) 2,119,030 (7) 3/6/2023 — — — — 709,220 (8) 3,475,178 (8) 6/1/2022 74,644 (9) 373,224 7.30 6/1/2032 281,016 (10) 1,376,978 3/6/2023 — (11) 177,377 8.46 3/6/2033 118,203 (12) 579,195 4/25/2017 834 (3) — 6.27 4/25/2027 — — 2/7/2018 20,834 (3) — 6.55 2/7/2028 — — 10/1/2018 49,480 (3) — 6.55 10/1/2028 — — 2/7/2019 34,375 (3) — 7.27 2/7/2029 — — 2/13/2020 44,687 (4) 2,709 31.71 2/13/2030 — — 3/4/2021 39,348 (5) 17,886 43.68 3/4/2031 11,448 (6) 56,095 3/4/2022 90,094 (13) 115,837 12.14 3/4/2032 61,779 (14) 302,717 3/6/2023 — (11) 199,549 8.46 3/6/2033 132,979 (12) 651,597 6/9/2015 70,110 (3) — 6.32 6/9/2025 — — 2/7/2018 284,800 (3) — 6.55 2/7/2028 — — 2/7/2019 410,000 (3) — 7.27 2/7/2029 — — 2/13/2020 287,500 (4) 12,500 31.71 2/13/2030 — — 3/4/2021 118,045 (5) 53,658 43.68 3/4/2031 34,341 (6) 168,271 3/4/2022 270,284 (13) 347,508 12.14 3/4/2032 185,338 (14) 908,156 3/6/2023 — — — — 709,220 (8) 3,475,178 (8) 2/7/2018 195,325 (3) — 6.55 2/7/2028 — — 2/7/2019 225,000 (3) — 7.27 2/7/2029 — — 2/13/2020 191,666 (4) 8,334 31.71 2/13/2030 — — 3/4/2021 78,697 (5) 35,772 43.68 3/4/2031 22,894 (6) 112,181 3/4/2022 202,713 (13) 260,631 12.14 3/4/2032 139,004 (14) 681,120 3/6/2023 — (11) 199,549 8.46 3/6/2033 132,979 (12) 651,597
| (1) | Reflects intrinsic value based on the closing price ($4.90) of our common stock on December 29, 2023. |
| (2) | Each equity award is subject to the acceleration of vesting provisions as set forth in the section titled “Potential Payments on Terminationor Change in Control.” |
| (3) | The shares underlying this option are fully vested. |
| (4) | The shares underlying this option vested 25% on February 13, 2021, then in 36 equal monthly installments thereafter. |
| (5) | The shares underlying this option vested 25% on March 4, 2022, then in 36 equal monthly installments thereafter. |
