Medco CEO Snow made $10.1M in 2006

Medco CEO Snow made $10.1M in 2006

	Published : Fri, 30 Mar 2007 23:13 By : Agencies Print this Story

TRENTON, N.J. (AP) - David B. Snow Jr., chief executive officer of Medco Health Solutions, the country's biggest manager of prescription benefits, received compensation valued at $10.1 million in 2006, according to an analysis of a regulatory filing made Friday.

Snow, 52, received a salary of $1.18 million last year, according to a proxy statement filed Friday with the Securities and Exchange Commission.

Most of his compensation, though, came from the stock shares and options the company awarded to him last March, when it valued the grants at $7.15 million.

In addition, Snow received $1.7 million from the company's nonequity incentive plan and a total of $44,809 in other compensation. That included $22,620 for his car allowance, $10,000 for financial planning, $9,900 in matching contributions to his 401(k) plan and $2,289 for insurance premiums.

The Associated Press calculations of total pay include executives' salary, any bonus, incentives, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.

Snow has been CEO and board chairman of Franklin Lakes, N.J.-based Medco since spring 2003, shortly before it was spun off by its former pharmaceutical parent, Merck & Co.

Medco had a strong year in 2006. In the fourth quarter, it posted record net income and surprised analysts by beating their profit expectations. Medco also raised its profit forecast for this year and Snow predicted earnings per share growth of at least 20 percent in 2008. Medco shares lost a few dollars in 2006, but are up from about $54 at the start of the year to the $72 range this week.

Last year, Medco saw net income rise 5 percent to $630.2 million and revenues jumped 12 percent to $42.5 billion. The company noted it retained 98 percent of its clients in 2006 and held their average prescription costs to a 2.8 percent increase, its lowest ever.

In October, Medco resolved a whistleblower case dating to 1999, agreeing to pay $155 million in fines to settle fraud, kickback and other charges brought by federal prosecutors in Philadelphia.

Medco admitted no wrongdoing. It was accused of paying health plans kickbacks to win their business, soliciting kickbacks from drugmakers to favor their drugs and destroying prescriptions when its mail-order pharmacies did not fill them as fast as required by its insurance plan contracts.