UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

Amendment No. 1

(Mark One)

For the fiscal year ended December 31, 2021

or 

For the transition period from              to              ..

Commission File Number 001-36306  

Eagle Pharmaceuticals, Inc.

(Exact Name of Registrant as Specified in its Charter)

50 Tice Boulevard, Suite 315

Woodcliff Lake, NJ 07677

(201) 326-5300

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices)

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ¨    No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x     No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x    No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in 12b-2 of the Exchange Act. 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. x 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨    No x

The aggregate market value of voting Common Stock held by non-affiliates of the registrant was approximately $437,105,101 computed by reference to the last reported sale price of $42.80 per share as reported by The Nasdaq Global Market, as of the last business day of the registrant’s most recently completed second fiscal quarter, June 30, 2021. This calculation does not reflect a determination that certain persons are affiliates of the registrant for any other purpose.

The number of shares outstanding of the registrant’s common stock, $0.001 par value per share, as of April 25, 2022 was 12,698,566 shares.

EXPLANATORY NOTE

Eagle Pharmaceuticals, Inc., or the Company, is filing this Amendment No. 1, or Amendment, to its Annual Report on Form 10-K originally filed with the Securities and Exchange Commission, or the SEC, on March 8, 2022, or the Initial Filing, solely for the purposes of amending and supplementing Part III of the Annual Report on Form 10-K. This Amendment changes the Company’s Initial Filing by including information required by Part III (Items 10, Director, Executive Officers and Corporate Governance, Item 11. Executive Compensation, Item 12, Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters, Item 13, Certain Relationships and Related Transactions, and Director Independence and Item 14, Principal Accounting Fees and Services) because the Company’s definitive proxy statement will not be filed within 120 days after December 31, 2021, the end of the fiscal year covered by the Company’s Annual Report on Form 10-K.

In addition, in connection with the filing of this Amendment, the Company is including new certifications of its principal executive officer and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Accordingly, Item 15, Exhibits and Financials Statement Schedules of Part IV of the Initial Filing has also been amended to reflect the filing of the new certifications. Because no financial statements are contained within this Amendment, the Company is not including certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Except as contained herein, this Amendment does not modify or update disclosures contained in the Initial Filing. This Amendment should be read in conjunction with the Company’s other filings made with the SEC subsequent to the date of the Initial Filing.

In this Amendment, “we,” “our,” “us,” “Eagle,” and “the Company” refer to Eagle Pharmaceuticals, Inc. and, where appropriate, its consolidated subsidiaries. This report contains references to our trademarks and trade names and to trademarks and trade names belonging to other entities. Solely for convenience, trademarks and trade names referred to in this report may appear without the ® or ™ symbols, but such references are not intended to indicate, in any way, that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend our use or display of other companies’ trademarks or trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

Table of Contents

PART III

Item 10. Directors, Executive Officers and Corporate Governance.

Board of Directors

The following table sets forth information as of March 31, 2022 with respect to our current directors serving on our board of directors, or our Board:

Scott Tarriff is our founder and has served as our Chief Executive Officer and as a member of our Board since our inception in January 2007. Prior to joining Eagle, Mr. Tarriff held various executive positions at Par Pharmaceutical Companies, Inc., a publicly-traded developer, manufacturer and marketer of specialty pharmaceuticals, including as president and chief executive officer from September 2003 to September 2006, after joining Par in 1998. Mr. Tarriff also served on Par’s board of directors from 2002 to September 2006. Prior to that, Mr. Tarriff held various positions with Bristol-Myers Squibb, a publicly-traded biopharmaceutical company, including senior director-marketing. Mr. Tarriff previously served as a director of Synthetic Biologics, Inc., a publicly-traded biotechnology company, from February 2012 to November 2020, as a director of Ziopharm Oncology, Inc., a publicly-traded biotechnology company, from September 2015 to December 2020 and as a director of Clinical Data, Inc., a publicly-traded pharmaceutical company, from September 2009 to April 2011 when Clinical Data was acquired by Forest Laboratories, Inc. Mr. Tarriff holds a B.S. in marketing from Pennsylvania State University and an M.B.A. from Rider College. Our Board believes that Mr. Tarriff’s extensive knowledge of our business, his management experience in the pharmaceutical industry, as well as his operational expertise, qualifies him to serve on our Board and as our Chief Executive Officer.

Michael Graves has served as a member of our Board since November 2013. In June 2016, our Board appointed Mr. Graves chairman of the Board. In January 2012, Mr. Graves joined the board of directors of RiboCor, Inc. and in December 2011, Mr. Graves was appointed executive chairman of the board of directors of Nanocopoeia, Inc., both private pharmaceutical companies. From May 2007 to July 2011, Mr. Graves served as the chief executive officer and president of Paddock Laboratories, Inc., a pharmaceutical company engaged in the manufacture, distribution and marketing of bioequivalent generic pharmaceuticals. From September 2005 to November 2006, Mr. Graves served as president of the generic products division at Par Pharmaceutical Companies, Inc., a publicly-traded developer, manufacturer and marketer of specialty pharmaceuticals. While at Par, Mr. Graves oversaw the strategy development of Par’s generic pharmaceutical business. Beginning in 1998, Mr. Graves served as director of marketing and sales operations of Par, and in 2004, Mr. Graves was promoted to senior vice president of corporate development and strategic planning. Mr. Graves served in this position until his promotion to president of the generic products division in September 2005. Mr. Graves holds a B.S. from State University College of New York at Buffalo. Our Board believes that Mr. Graves’ extensive experience in marketing, sales, business development and operations qualifies him to serve on our Board.

Steven B. Ratoff has served as a member of our Board since March 2007. Mr. Ratoff is a private investor who has served as the chief executive officer of CM Systems LLC, a cloud-based software company, since July 2018. Mr. Ratoff’s prior experience includes serving as a venture partner for ProQuest Investments from 2005 to 2013, as chief executive officer of Novadel Pharma, Inc., a specialty pharmaceutical company, from 2010 to 2017, and as chief executive officer of CIMA Labs, Inc., a specialty pharmaceutical company acquired by Cephalon in 2004. In addition, Mr. Ratoff served as chief financial officer of the Brown-Forman Company from 1995 to 2001. Mr. Ratoff holds a B.S. in business administration from Boston University and an M.B.A. with Distinction from the University of Michigan. Our Board believes that Mr. Ratoff’s extensive executive experience and background in the global pharmaceutical and consumer products industries as well as his strong financial background qualifies him to serve on our Board.

Dr. Jennifer K. Simpson, Ph.D., MSN, CRNP has served as a member of our Board since August 2019. Dr. Simpson also serves as a director of CytRx Corporation, a publicly traded biotechnology company. Dr. Simpson serves as CEO and on the Board of Directors of Panbela Therapeutics, Inc. (formerly known as Sun BioPharma, Inc.) a company developing disruptive therapeutics for the treatment of patients with pancreatic cancer. From May 2015 to June 2020, Dr. Simpson served as CEO and on the Board of Directors from October 2015 to June 2020 of Delcath Systems, Inc., an interventional oncology company focused on the treatment of primary and metastatic liver cancers. She joined Delcath in 2012 as an Executive Vice President, Global Marketing. From May 2011 to March 2012, Dr. Simpson served as the Vice President, Global Marketing, Oncology Brand Lead at ImClone Systems, Inc. (a wholly owned subsidiary of Eli Lilly and Company), where she was responsible for all product commercialization activities and launch preparation for one of the late-stage assets. From June 2009 to May 2011, Dr. Simpson served as the Vice President, Product Champion and from 2008 to 2009 as the Associate Vice President, Product Champion for ImClone’s product Ramucirumab. Prior to ImClone, Dr, Simpson worked at Ortho Biotech (now Janssen Biotech) focused in Oncology and spent over a decade as a hematology/oncology nurse practitioner and educator. Dr. Simpson earned a Ph.D. in Epidemiology from the University of Pittsburgh, an M.S. in Nursing from the University of Rochester, and a B.S. in Nursing from the State University of New York at Buffalo. The Nominating Committee considered Dr. Simpson’s experience and qualifications, in addition to her relevant executive management and operational pharmaceutical experience, as well as the overall composition of the Board, in making the determination that Dr. Simpson should serve as director of Eagle.

Robert Glenning has served as a member of our Board since July 2016. Mr. Glenning has over 30 years of experience in the healthcare industry and since July 2016 has served as the President of the Financial Services and Information Service Divisions and Chief Financial Officer at Hackensack Meridian Health, a not-for- profit healthcare organization that is the most comprehensive health delivery network in the state of New Jersey, with anticipated revenues of over $6 billion annually. From 2007 to June 2016, he served as Executive Vice President and Chief Financial Officer of Hackensack University Health Network. From 2002 to 2007, Mr. Glenning served as an Executive Vice President and Chief Financial Officer of Kaleida Health Inc., the largest healthcare system in western New York. Prior to Kaleida Health, he served as Vice President and Chief Financial Officer of acute care at Northeast Health and Albany Memorial Hospital. Mr. Glenning began his career at PricewaterhouseCoopers. He earned his BBA from Siena College and his MBA from Clarkson University. He is a Certified Public Accountant (license currently inactive). Our Board believes that Mr. Glenning’s extensive executive experience and background in the healthcare industry as well as his strong financial background qualifies him to serve on our Board.

Richard A. Edlin has served as a member of our Board since March 2017. Mr. Edlin joined law firm Greenberg Traurig, LLP in August 2000. He was named vice chair of the firm in September 2016 and chair of the New York Litigation Department in January 2014. He has been a member of the firm’s executive committee since February 2013. Mr. Edlin is a trial lawyer with broad experience in both trial and appellate courts including the U.S. Supreme Court and the Delaware Supreme Court. He has tried cases in federal and state courts across the country and has handled domestic and international arbitrations. Mr. Edlin handles a wide variety of litigation and routinely acts for companies and their management in areas such as securities, general commercial and contractual disputes, antitrust and intellectual property. He is currently handling matters for leading financial institutions arising out of the economic downturn and real estate collapse; intellectual property litigation for major electronics/consumer companies; for leading pharmaceutical companies involved in contract disputes; antitrust investigations; and for individuals involved in various commercial disputes. Mr. Edlin is a frequent lecturer on litigation strategy and is the author of Courtroom Strategies for Litigation Success. He received his B.A. degree from Tufts University, magna cum laude in history, and received his law degree from Columbia University School of Law, where he was a Harlan Fiske Stone Scholar. Our Board believes that Mr. Edlin’s experience as an attorney and his demonstrated facility as a corporate and strategic advisor qualify him to serve on our Board.

Dr. Luciana Borio, M.D. has served as a member of our Board since April 2021. Since 2021, Dr. Borio has served as a venture partner at Arch Venture Partners. Between 2017 and 2019, Dr. Borio has served as Senior Vice President of In-Q-Tel, an independent strategic investment firm that supports the mission of the United States national security community, and served as a member of President Biden’s Transition COVID-19 Advisory Board from November 2020 to January 2021. Previously, Dr. Borio served as Director, Medical and Biodefense Preparedness Policy, for the White House National Security Council from 2017 to 2019. Prior to that, Dr. Borio spent nearly ten years at the United States Food and Drug Administration in roles of increasing responsibility, serving as Acting Chief Scientist from 2015 to 2017, Assistant Commissioner for Counterterrorism Policy from 2010 to 2017, Director of the Office of Counterterrorism and Emerging Threats from 2010 to 2015 and Medical Officer from 2008 to 2010. Dr. Borio also currently serves as a Senior Fellow for Global Health at the Council on Foreign Relations, as a trustee of Noblis, on the Scientific Advisory Board of the Clorox Company and on the Regulatory Advisory Board of National Resilience. Dr. Borio earned an M.D. with distinction from George Washington University School of Medicine and a B.S. in Zoology from George Washington University. Our Board believes that Dr. Borio’s background and extensive experience working in government and regulatory agencies, as well as her medical and public health expertise, qualifies her to serve on our Board.

Certain Corporate Governance Matters

Audit Committee

Our audit committee currently consists of Steven Ratoff, Michael Graves and Robert Glenning, each of whom our Board has determined meets the independence requirements of Rule 10A-3 of the Exchange Act and the listing standards of The Nasdaq Stock Market LLC, or Nasdaq, with respect to audit committee members.

Our Board has determined that Steven Ratoff qualifies as an audit committee financial expert within the meaning of SEC regulations and meets the financial sophistication requirements of Nasdaq listing rules. In making this determination, our Board has considered Mr. Ratoff’s extensive financial experience and business background. Both our independent registered public accounting firm and management periodically meet privately with our audit committee.

Code of Business Conduct and Ethics

We have adopted a Code of Business Conduct and Ethics, or the Code of Conduct, applicable to all of our employees, executive officers and directors. The Code of Conduct is available on our website at www.eagleus.com. The nominating and corporate governance committee of our Board is responsible for overseeing the Code of Conduct and must approve any waivers of the Code of Conduct for employees, executive officers and directors. We intend to disclose any amendment or waiver of a provision of the Code of Conduct that applies to our principal executive officer, principal financial officer, or principal accounting officer, or persons performing similar functions, by posting such information on our website.

Director Nominations

No material changes have been made to the procedures by which shareholders may recommend nominees to our Board.

Executive Officers

The following table sets forth certain information with respect to our executive officers as of March 31, 2022:

Biographical information for Mr. Tarriff is presented above.

Brian Cahill has served as our Chief Financial Officer since October 2020. Mr. Cahill served as the Vice President of Finance of the Company from January 2018 to October 2020 and previously served as the Company’s Corporate Controller from October 2016 to December 2017. Prior to joining the Company, Mr. Cahill held Corporate Controller positions from November 2015 to October 2016 at Aralez Pharmaceuticals, Inc., a specialty pharmaceutical company, and from October 2006 to October 2015 at Par Pharmaceutical Companies, Inc., a generic and branded pharmaceutical company, where he had broad responsibility for the technical accounting, management and Securities and Exchange Commission reporting, income tax, revenue controls, financial business integration, payroll, and accounts payable functions. Mr. Cahill also held positions of increasing responsibility from November 1999 to October 2006 at PricewaterhouseCoopers LLP. Mr. Cahill holds a B.S. in Accounting from Manhattan College and is a Certified Public Accountant.

Michael Moran has served as our Executive Vice President, Chief Commercial Officer since September 2021, and previously served as our Executive Vice President, Sales, Business Development and Government Affairs from August 2019 through September 2021 and as our Vice President - US Head of Sales, Market Access and Government Affairs from January 2016 to August 2019. Before joining us in January 2016, Mr. Moran spent eight years at GlaxoSmithKline, eventually serving as Field Vice-President. Prior to that, Mr. Moran served as Northeast Regional Business Director of Reliant Pharmaceuticals, and prior to that as Senior District Manager at Muro Pharmaceuticals. Mr. Moran began his career with AstraZeneca Pharmaceuticals, serving as a Pharmaceutical Sales Specialist. Mr. Moran holds a B.S. in business management from the State University of New York at Empire and completed the Transformational Leadership for Executives program at the University of Pennsylvania Wharton School of Business.

Item 11. Executive Compensation.

Executive compensation

Compensation Discussion and Analysis

This Compensation Discussion and Analysis provides an overview of the material components of our executive compensation program for the fiscal year ended December 31, 2021, for our "named executive officers" who are listed below. This discussion and analysis is intended to assist you in understanding the information provided in the compensation tables below and to provide additional context regarding our overall compensation program. In addition, we explain how and why our Board and compensation committee determined our compensation policies and made specific compensation decisions for our named executive officers during and for 2021.

Named Executive Officers

Our named executive officers for the fiscal year ended December 31, 2021, are as follows:

Executive Summary

Business Highlights

We are an integrated pharmaceutical company focused on finding ways to help medicines do more for patients. Along with our collaborators, we have the capabilities to take a molecule from preclinical research through regulatory approval and into the marketplace, including development, manufacturing and commercialization of our products and product candidates. Our business model applies our scientific expertise, proprietary research-based insights and marketplace proficiency to identify challenging-to-treat diseases of the central nervous system or metabolic critical care therapeutic areas as well as in oncology. By focusing on patients' unmet needs, we strive to provide healthcare professionals with urgently needed treatment solutions that are designed to improve patient care and outcomes and create near- and long-term value for our stakeholders, including patients and healthcare providers and our employees, marketing partners, collaborators and stockholders.

Our science-based business model has a proven track record with U.S. Food and Drug Administration, or FDA, approval and commercial launches of three products: RYANODEX® (dantrolene sodium), or RYANODEX, bendamustine ready-to-dilute, or RTD, 500ml solution, or BELRAPZO, rapidly infused bendamustine RTD, or BENDEKA. We market our products through marketing partners and/or our internal direct sales force. We market RYANODEX and BELRAPZO, and Teva Pharmaceutical Industries Ltd. markets BENDEKA through its subsidiary Cephalon, Inc. In addition, in February 2022, we announced the commercial availability of PEMFEXY®, our novel pemetrexed product, or PEMFEXY, a branded alternative to ALIMTA® for metastatic nonsquamous nonsmall cell lung cancer and malignant pleural mesothelioma, and in January 2022, we announced the commercial availability of our recently approved product, vasopressin, an A-rated generic alternative to Vasostrict®, with 180 days of marketing exclusivity.

With several pipeline projects underway and the potential for product launches over the next few years, we believe we have many growth opportunities ahead. We believe that each of our pipeline projects currently has the potential to enter the market as a first-in-class, first-to-file, first-to-market or best-in-class product. In particular, we are applying our expertise to conduct novel research regarding the potential for Ryanodex to address conditions including nerve agent, acute radiation syndrome, traumatic brain injury/concussion and Alzheimer’s disease as well as investigations of compounds such as EA-114 (our fulvestrant product candidate) for patients with HR-positive advanced breast cancer. Our clinical development program also includes a license agreement with Combioxin, SA under which we were granted exclusive, worldwide development commercialization rights to CAL02, a novel first-in-class antitoxin agent for Phase 2b/3 development for the treatment of severe pneumonia in combination with traditional antibacterial drugs and a license agreement with AOP Orphan, for the commercial rights to its product, landiolol in the United States. Landiolol is a leading hospital emergency use product, which is currently approved in Europe for the treatment of non-compensatory sinus tachycardia and tachycardic supraventricular arrhythmias..

We believe that our strong financial foundation, with zero net debt and profitability from 2015 (our first full year as a publicly traded company) to 2020, underpins our promising pipeline. Since 2013, we have invested $282 million—more than 22% of revenue over that period—in research and development. Through our stock repurchase program we have returned $228.1 million to our stockholders as of December 31, 2021, a figure that exceeds the aggregate capital we have raised in the public equity markets since our initial public offering in 2014.

Compensation Highlights

Our compensation committee has carefully considered the significant corporate achievements described above and our transformation as a company in making compensation decisions. Our compensation committee aims to provide our named executive officers with compensation that is dependent upon their individual performance, the performance of our business and our common stock, and consistent with our compensation philosophy. As our business grows and transforms, our executive compensation program has also continued to evolve and transform. Our compensation committee carefully evaluates our compensation arrangements and develops plans and arrangements that it believes are the most appropriate to drive results for our Company and our stockholders, and makes changes as we move forward to ensure that our compensation program aligns our executive officers' compensation with our stockholders' interests and our Company performance over the long-term.

Key features of our executive compensation program include the following:

Stockholder Engagement and Actions in Response to Advisory Vote on Executive Compensation

At our 2021 Annual Meeting of Stockholders, our stockholders approved, on an advisory basis, the compensation of our named executive officers, as disclosed in our 2021 proxy statement. The proposal was supported by approximately 93% of the total votes cast, a 72% increase over our 2020 "say on pay" vote. We believe this increase of support was, in part, the result of the stockholder outreach that we commenced and changes we made to our executive compensation program over the past two years. During 2021, members of our management, and in some cases members of our compensation committee and Board, actively engaged in a dialogue with a significant number of our large stockholders to gain a better understanding of their views regarding our executive compensation program as well as other corporate governance matters. Specifically, we reached out to our largest stockholders representing over 80% of our outstanding common stock. We held informative discussions with several of our top holders who expressed interest in speaking with us, representing approximately 40% of our outstanding common stock. Our compensation committee's primary actions resulting from our 2020 and 2021 "say on pay" advisory votes and stockholder outreach were as follows:

The primary feedback we received from stockholders was a desire for us to structure a greater portion of equity opportunities in the form of performance-vesting awards, a concern with the magnitude of CEO compensation (particularly equity compensation) and our alignment of pay with company performance. As a result, the compensation committee spent considerable time developing changes to our executive compensation program for 2021.

First, the compensation committee chose not to extend or modify our outstanding PSUs that were granted during 2018; as a result, each of our NEOs forfeited sizable equity opportunities in early 2021. These PSUs were eligible to vest in early 2021 only if we met significant stock price goals during the three-year performance period. Although we believe that the COVID-19 pandemic and other factors outside the control of management contributed to our inability to meet these goals within the performance period, we chose not to extend the performance period or adjust the performance goals, in line with our pay for performance philosophy.

Second, the compensation committee developed a 2021 executive compensation program heavily weighted to a new PSU program with following key terms:

➢We increased the proportion of equity delivered in PSUs. PSUs represented 100% of our CEO’s 2021 equity award and 65% of our other continuing NEO’s 2021 equity awards (the remaining 35% consisted of RSUs).

➢We decreased the grant value of our CEO’s equity award. The target grant date value of the CEO’s 2021 PSU award approximated the median value of equity awards granted by our peer companies and reflected nearly a 50% decrease from the grant date value of the CEO’s 2020 equity awards.

➢We refined the goals and structure of our 2021 PSUs compared to our 2018 PSUs. Our 2021 PSUs have a three-year performance period, with vesting dependent on achievement of multiple performance goals, rather than simply stock price over a 30-day period. A portion of the PSU vests based on our total shareholder return relative to the S&P500 Biotech Select Index and a portion of the PSU vests based on our achievement of key regulatory and sales milestones for our business.

➢We lowered the cap on payout. The number of 2021 PSUs that may vest based on performance achievement is capped at 2x for our CEO and lesser amounts for our other NEOs. The 2018 PSUs allowed for up to a 3x payout if the highest stock price hurdle was achieved.

We continued to grant PSUs on similar terms as the 2021 PSUs described above to each of our continuing NEOs in 2022.

Our compensation committee will monitor and continue to evaluate our executive compensation program going forward in light of our stockholders views and our transforming business needs. Our compensation committee expects to continue to consider the outcome of our "say on pay" votes and our stockholders' views when making future compensation decisions for our named executive officers.

Realizable Pay and Alignment with Company Performance

Because we provide a significant portion of target total direct compensation in the form of "at-risk" equity awards, evaluating the compensation that is actually realizable by our Chief Executive Officer provides an important perspective to understanding the alignment between his pay and our Company's performance and stockholder interests. Realizable pay recognizes the impact of actual financial and stock performance in the returns available (or "realizable") by the executive. In contrast, reported pay (which reflects the grant date fair value for equity awards reported in the Summary Compensation Table) estimates the expected value of compensation on the day it was granted, in accordance with financial accounting standards.

The following chart shows our indexed total stockholder return, or TSR, for 2019, 2020 and 2021, the past three fully-completed years, with both our Chief Executive Officer's total reported compensation as well as his "realizable" pay, which reflects base salary and annual performance bonus earned and values equity awards granted during the year using their "intrinsic" value as of the end of the applicable year, which is the value the award could deliver as of such time (whether or not time-vesting requirements are met for vesting or exercise and, for performance-vesting awards with ongoing performance periods, assuming target performance). Indexed TSR is the return associated with a hypothetical $100 investment in our common stock at the beginning of the relevant period.

The chart above demonstrates that while reported pay is the measure required to be disclosed in our "Summary Compensation Table", it is not the measure that best reflects the compensation paid to our Chief Executive Officer, nor the amount that can best be compared to our stock price in evaluating whether our Chief Executive Officer's compensation is aligned with our stockholders' interests.

Over the prior three-year period, our TSR has increased approximately 8% and our Chief Executive Officer's three-year average realizable pay represents approximately 80% of three-year average reported pay. For 2021, our TSR increased compared to 2020. Realizable pay likewise increased in 2021 as a result of our Chief Executive Officer's larger performance bonus payment (reflecting 164% of corporate goal achievement in 2021 as compared to 70% in 2020) and the fact that our Chief Executive Officer was granted equity solely in the form of PSUs in 2021, which resulted in realizable value proportional to our stock performance (in 2020, our Chief Executive Officer was granted RSUs and options, which were underwater as of the end of 2020). Because the 2021 PSUs are eligible to vest at the end of the three-year performance period only if performance goals are achieved, the amount of shares that may be realized is unknowable at such time and accordingly, the “realizable value” of these awards as of the end of 2021 is based on target shares. 2021 reported pay was lower than 2020 reported pay because of the substantially decreased grant date value of the equity awards we provided to the Chief Executive Officer in 2021 in response to the stockholder feedback described above.

Overview of our Executive Compensation Program

Objectives, Philosophy and Elements of Compensation

The overall objectives of our executive compensation program, including the related policies and practices are to:

Our executive compensation program generally consists of, and is intended to strike a balance among, the following three principal elements: base salary, annual performance bonuses and long-term incentive compensation in the form of equity awards. We also provide our executive officers with severance and change-in-control payments and benefits, as well as other benefits generally available to all our employees, including retirement benefits under our 401(k) plan and participation in employee benefit plans. The following table summarizes these three principal elements, their objectives and key features.

In evaluating our executive compensation program and policies, as well as the short-term and long-term value of our executive compensation plans and arrangements, our compensation committee (on behalf of our Board) focuses on providing a competitive compensation package that provides significant short-term and long-term incentives for the achievement of measurable corporate objectives and individual contribution towards our corporate performance. We believe that this approach provides an appropriate blend of short-term and long-term incentives to maximize stockholder value.

We do not currently have any formal policies for allocating compensation among base salary, annual performance bonuses and equity awards, short-term and long-term compensation or among cash and non-cash compensation. Instead, our compensation committee uses its judgment to establish a target total direct compensation opportunity for each named executive officer that is a mix of current, short-term and long-term incentive compensation, and cash and non-cash compensation, that it believes appropriate to achieve the goals of our executive compensation program and our corporate objectives. However, a significant portion of our named executive officers' target total direct compensation opportunity is comprised of "at-risk" compensation in the form of an annual performance bonus opportunity and equity awards tied to stockholder returns, in order to align their incentives with the interests of our stockholders and our corporate objectives.

How We Determine Executive Compensation

Role of our Compensation Committee and Executive Officers in Setting Executive Compensation

As further described above, our compensation committee, comprised entirely of independent directors, is responsible for administering our executive compensation program and operates under a written charter. Among other things, the role of our compensation committee is to oversee our executive compensation program, policies, practices and plans, and to review and determine, as appropriate, the compensation to be paid to our executive officers and the non-employee members of our Board. As necessary, and if deemed appropriate by our compensation committee, the compensation committee may also make recommendations to the full Board for approval of certain compensation decisions relating to our named executive officers.

In making its executive compensation determinations, our compensation committee and, if applicable, the full Board, considers recommendations from our Chief Executive Officer for our executive officers (other than himself). In making his recommendations, our Chief Executive Officer has access to various third party compensation surveys and compensation data provided by our compensation committee's compensation consultant, as described below. While our Chief Executive Officer discusses his recommendations for the other executive officers with our compensation committee, he does not participate in the deliberations concerning, or the determination of, his own compensation. From time to time, various members of management and other employees as well as outside advisors or consultants may be invited by our compensation committee to make presentations, provide financial or other background information or advice or otherwise participate in compensation committee meetings. No executive officer is present during voting or deliberations on his or her own compensation.

Role of our Compensation Consultant

Our compensation committee has the sole authority to retain compensation consultants to assist in its evaluation of executive compensation, including the authority to approve the consultant's reasonable fees and other retention terms. As in prior years, for purposes of evaluating 2021 compensation for each of our executive officers and making 2021 compensation decisions, our compensation committee retained Compensia, a national compensation consultant, to assist it in reviewing our executive compensation program and to ensure that our compensation program remains competitive in attracting and retaining talented executives.

During 2021, Compensia assisted our compensation committee in selecting a group of peer companies to use as a reference in understanding the competitive market, evaluating current pay practices and philosophies and considering compensation and corporate governance best practices. As described further below, Compensia also prepared an analysis of our compensation practices with respect to base salaries, annual bonuses and long-term incentive compensation compared to competitive market practices. Compensia reports directly to our compensation committee, which maintains the authority to direct their work and engagement, and advises the compensation committee from time to time. Compensia interacts with management to gain access to company information that is required to perform its services and to understand the culture and policies of our organization.

Our compensation committee has considered whether the work of Compensia has raised any conflict of interest, taking into account the following factors: (i) the amount of fees paid to Compensia, as a percentage of the firm's total revenue; (ii) the provision of other services to us by Compensia; (iii) Compensia's policies and procedures that are designed to prevent conflicts of interest; (iv) any business or personal relationship of the individual compensation advisors with any member of the compensation committee; (v) any business or personal relationship of Compensia or the individual compensation advisors employed by the firm with any of our executive officers and (vi) any shares of our common stock owned by the individual compensation advisors employed by Compensia. Based on the above factors, our compensation committee has concluded that the work of Compensia and the individual compensation advisors employed by Compensia has not created any conflict of interest.

Use of Competitive Market Data

We strive to attract and retain the most highly qualified executive officers in an extremely competitive market. Accordingly, our compensation committee believes that it is important when making its compensation decisions to be informed as to the competitive market for executive talent, including the current practices of comparable public companies with which we compete for such talent. Consequently, our compensation committee reviews market data for each executive officer's position, compiled by Compensia as described below.

Our compensation committee used a group of peer companies, developed with the assistance of Compensia, as a reference point in making 2021 executive compensation decisions. This compensation peer group was selected from among publicly-traded specialty pharmaceutical and biotechnology companies, based on the comparability of our market capitalization, and our business models. As of late 2020, the peer companies market capitalizations ranged, based on the 25^th to 75^th percentiles, between $437 million and $1.342 billion; at such time, our market capitalization fell at approximately the 38^th percentile of the companies in the peer group. The 2021 peer group included the addition of five new peers that Compensia recommended due to their size and business models (Agenus, Clovis Oncology, Coherus BioSciences, Collegium Pharmaceutical and Vanda Pharmaceuticals), as reflected below, and removal of seven historical peers from 2020 (Acorda Therapeutics, Akorn, which was no longer publicly traded, Alkermes, Emergent BioSolutions, Haolozyme, Horizon Therapeutics and The Medicines Co., which was no longer publicly traded ).

This compensation peer group, which is referred to herein as our 2021 peer group, consisted of the following 16 publicly-traded companies:

*New for 2021

Our compensation committee believes that the companies selected for the 2021 peer group were comparable to us, and represented our labor market for talent for key leadership positions at the time the compensation decisions for 2021 were made.

Our compensation committee did not "benchmark" the compensation of any of our named executive officers to a specific percentile of the compensation data derived from our 2021 peer group. Rather, our compensation committee reviews compensation data from the 2021 peer group companies, referred to as the market data, as reference points in making executive compensation decisions. Our compensation committee's general aim is for total executive compensation to remain competitive with the market, with individual amounts varying as appropriate based on corporate and individual executive performance, and other factors deemed to be appropriate by our compensation committee. The compensation committee has not developed a specific market positioning that we consistently aim for in setting compensation levels; instead our compensation committee determines each element of compensation, and total target cash and direct compensation, for each named executive officer based on various facts and circumstances appropriate for us in any given year. Competitive market positioning is only one of several factors, as described below under "Factors Used in Determining Executive Compensation," that our compensation committee considers in making compensation decisions, and therefore individual named executive officer compensation may fall at varying levels as compared to the market data.

Factors Used in Determining Executive Compensation

Our compensation committee sets the compensation of our executive officers at levels it determines to be competitive and appropriate for each named executive officer, using its professional experience and judgment. Compensation decisions are not made by use of a formulaic approach or benchmark; our compensation committee believes that these decisions require consideration of a multitude of relevant factors that may vary from year to year. In making executive compensation decisions, our compensation committee generally takes into consideration the factors listed below.

2021 Executive Compensation Program

Annual Base Salary

In February 2021, our compensation committee increased the base salaries of Messrs. Tariff, Moran and Pernock by approximately three percent. The compensation committee decided to prorate the market based merit increase for Dr. Ng-Cashin based on her hire date in October 2020 and not to increase the base salary of Mr. Cahill, which was determined in connection with his promotion to Chief Financial Officer in October 2020. Although some named executive officer's base salaries fell well below the median of the market data, the compensation committee kept base salary increases minimal to adjust for cost of living increases, to provide consistency across the executive team for internal parity purposes and because our compensation committee wanted to emphasize the 'at risk' components of pay rather than fixed cash compensation.

Our named executive officers' 2021 annual base salaries and increases from each of their base salaries in effect as of the end of 2020, were as follows:

Annual Performance Bonuses

Our annual performance bonus program for 2021 was developed by our compensation committee and approved by the independent members of our Board. Under the program, each named executive officer was eligible to earn a performance bonus based on the achievement of corporate objectives established by our Board for the year, based on such officers target annual performance bonus opportunity, expressed as a percentage of such officers base salary, or target bonus percentage.

For 2021, the compensation committee maintained the same target bonus percentages for our named executive officers that were in place for 2020 (100% of base salary for our Chief Executive Officer and 60% of base salary for our other named executive officers). Our Chief Executive Officer's performance bonus target percentage was larger than the target bonus percentages of our other named executive officers because he has a greater impact on, and responsibility for, our corporate performance. No specific individual goals were established for any of our named executive officers for 2021, and accordingly each of our named executive officers' performance bonuses were intended to be tied to our corporate performance objectives. Because each named executive officer is responsible for contributing to the achievement of the corporate performance goals, individually and as part of the leadership team, such officers individual contribution towards our achievement of the corporate performance goals was considered by the compensation committee in approving individual bonus awards.

The 2021 corporate performance goals on which the annual performance bonuses were based were cross-functional in nature designed to require collaboration among all named executive officers and their respective areas of responsibility to achieve success. Their attainment of the goals was intended to give us the best positioning for future growth while delivering short term benefits thus aligning the interests of our named executive officers with those of our stockholders. In January 2021, our compensation committee reviewed and approved the extent to which we achieved each of our corporate performance goals. Given the results, our compensation committee determined that we met our corporate goals at a 164% overall level. Each of the 2021 corporate goals evaluated is listed below followed by a description of our achievement in relation to such goal:

Our compensation committee approved a performance bonus payment to each of our named executive officers under our 2021 annual performance bonus program at 164% of target bonus. Each of our named executive officer's actual bonus payment, as a dollar amount and a percentage of such officers her target annual performance bonus opportunity, as well as the target bonus amount on which such bonus was based, is shown in the table below:

⁽¹⁾ Mr. Moran’s base salary was increased from $397,000 to $455,800 in October 2021 in connection with his appointment as our Chief Commercial Officer. As a result, his 2021 performance bonus amount was calculated based on his prorated base salary from October 1, 2021.

⁽²⁾ Mr. Pernock and Dr. Ng-Cashin ceased employment during 2021 and as a result did not receive a 2021 bonus under our annual performance bonus program. As a result of his separation, Mr. Pernock received a severance payment, a portion of which was calculated by reference to his target bonus for 2021, as further described below under “—Severance and Change in Control Benefits”.

Long-Term Equity-Incentives

2021 Equity Awards

We have historically granted equity awards to our named executive officers exclusively in the form of stock options. Beginning in 2018, as a result of stockholder feedback, our compensation committee granted "full value" awards for the first time, in the form of restricted stock units, or RSUs, and performance vesting RSUs, or PSUs that were eligible to vest following a three-year performance period that ended in early 2021, if we achieved rigorous stock price performance goals during such period (the “2018-2020 PSUs”). In 2019 and 2020, we continued to grant stock options and RSUs to our then-serving named executive officers. In early 2021, each of Mr. Tariff and our named executive officers who held PSUs (Messrs. Cahill, Moran and Pernock) forfeited the entirety of their 2018-2020 PSUs because, despite coming close to our goals, we were unable to meet and sustain our stock price goals for such PSUs. The compensation committee chose not to extend the performance period or adjust the performance goals because it believed that maintaining the original goals and allowing forfeiture of the awards was in line with our overall pay for performance philosophy.

For 2021, the compensation committee re-evaluated our executive equity compensation and granted 2021 equity awards to our named executive officers heavily weighted to a newly developed PSU program. The compensation committee granted our CEO’s 2021 equity awards solely in the form of PSUs and granted our other named executive officers’ equity awards as 65% PSUs and 35% RSUs, based on the target grant value. The target grant value of each of our named executive officer’s 2021 equity awards (and the grant date fair value under ASC 718) was lower than the 2020 equity awards; in the case of Mr. Tarriff, the grant date fair value of his 2021 equity awards represented nearly a 50% decrease from the grant date fair value of his 2020 equity awards.

The PSU program consisted of two types of PSUs: a rTSR PSU and a Milestone PSU. Both rTSR PSUs and Milestone PSUs are structured to vest following conclusion of a three year performance period that runs from February 2021 through February 2024, if the relevant performance goals are achieved during such performance period. The rTSR PSUs are eligible to vest based on our total shareholder return relative to the S&P 600 Biotech Select Index over the three year performance period (the “rTSR”). The number of rTSR PSUs that may vest based on the rTSR ranges from 0% to 200% of the target number of rTSR PSUs, as follows: if we achieve rTSR at the 90th percentile, 200% of the target rTSR PSUs will vest; if we achieve rTSR at the 50th percentile, 100% of the target rTSR PSUs will vest; if we achieve rTSR at the 25th percentile, 50% of the target rTSR PSUs will vest. To the extent rTSR is between the 25^th percentile and 90^th percentile, the number of PSUs that will vest will be determined using linear interpolation. In addition, our absolute total shareholder return for the performance period must be greater than zero for any rTSR PSUs above target to vest.

The Milestone PSUs are eligible to vest based on our achievement of one or more of three milestones related to regulatory approval of fulvestrant (EA-114), sales of PEMFEXY™ and sales of vasopressin, respectively during the three year performance period. The number of Milestone PSUs that may vest based on the milestones ranges from 0% to 200% of the target number of Milestone PSUs, in the case of Mr. Tarriff, 175% of the target number of Milestone PSUs, in the case of Mr. Pernock, and 150% of the target number of Milestone PSUs, in the case of all of our other named executive officers. The compensation committee chose these milestones because it believes that they represent key growth drivers for our business that if met, could establish the foundation for revenue growth and increasing returns to our stockholders. The compensation committee set the milestones to be rigorous but achievable within the performance period with significant efforts. We are not disclosing the details of our three milestones because we believe that disclosure would result in competitive harm. If the milestones were disclosed, we believe the information would provide competitors with insights in our strategy, operations and development programs that would be harmful to us.

The PSUs are eligible to vest under certain circumstances in connection with a change in control prior to the end of the performance period, based on measurement at such time of the rTSR, the extent we achieved any of the milestones and our stock price in such transaction. Any PSUs that are assumed or continued by the acquiring or surviving entity following such change in control are subject to “double trigger” vesting acceleration if the executive officer is terminated involuntarily within a certain period of time following such change in control.

The compensation committee granted RSUs to our named executive officers other than Mr. Tarriff because the committee believed RSUs were appropriate and necessary to retain our named executive officers over the long term and align their interests with our stockholders, as these awards provide value if the executive remains with us over a four year period, and the value delivered is directly dependent on our stock price. The RSUs vest over a four-year period from the date of grant, subject to the executive officer’s continued service.

The annual equity awards granted to our named executive officers are reflected in the table below and were approved in February 2021.

In determining the appropriate amount of each named executive officer’s annual equity awards, our compensation committee considered each named executive officer’s current equity holdings, and in particular the fact that our executives held little to no unvested “in-the-money” stock options that served as a retention tool as well as potential dilution of our share reserves, each named executive officer’s individual performance, total pay opportunities, and market data provided by Compensia. Our compensation committee used its subjective judgement to determine the amounts it believed were appropriate for each named executive officer, weighing the factors listed above.

The ultimate grant date fair value of the February 2021 annual equity awards to our executive officers (other than Mr. Tariff) reflected in the Summary Compensation Table does not reflect an exact 65% PSU and 35% RSU mix. The target grant value used by our compensation committee to calculate the number of shares subject to each named executive officer’s equity awards (and the 65%/35% mix of PSUs and RSUs) assumed target performance level for PSUs and utilized a 30-day average trading price to mitigate the impact of one-day or short-term stock price fluctuations. The grant date fair value of the PSUs and RSUs as reflected in the Summary Compensation Table are calculated under financial accounting standards based on a single day closing price of our common stock on the grant date and for the PSUs, include additional discounts and valuation methodologies to take into account the probable outcome of the performance conditions (for rTSR PSUs, applying a Monte-Carlo simulation).

Other Features of our Executive Compensation Program

Agreements with our Named Executive Officers

Our Chief Executive Officer entered into an employment agreement and our other named executive officers each signed offer letters of employment upon their joining the Company. Each of these agreements established the named executive officer's starting base salary, initial target annual performance bonus opportunity, and initial equity grant. These individuals' base salaries, annual performance bonus opportunities and any equity awards are reviewed annually by our compensation committee; the amounts effective for 2021 are described above in this Compensation Discussion and Analysis.

Severance and Change in Control Benefits

We provide severance benefits to certain of our named executive officers upon certain types of involuntary termination events, including terminations in connection with a change in control of our Company. In addition, our named executive officers are eligible for vesting acceleration of equity awards if, in connection with a change in control of our Company, the successor or acquiring entity refuses to assume, continue or substitute for such equity awards. The compensation committee believes that that severance and change in control protection payments and benefits are necessary to provide stability among our executive officers, serve to focus our executive officers on our business operations, and avoid distractions in connection with a potential change in control transaction or period of uncertainty.

Our compensation committee periodically reviews the severance and change in control payments and benefits that we provide, including by reference to market data, to ensure they remain appropriately structured and at reasonable levels. In December 2019, after a review of market data, we adopted the Amended and Restated Severance Benefit Plan, or the Severance Plan. The Severance Plan provides severance and change in control benefits to our Chief Executive Officer and certain other designated Company employees, including Mr. Moran and Mr. Pernock (prior to his separation), and supersedes and replaces each named executive officer's letter agreement, employment agreement or other agreement providing for severance or change in control benefits, unless otherwise indicated in Severance Plan. The compensation committee adopted the Severance Plan to provide benefits that they felt were more consistent with market data that would provide reasonable protection to our executives and serve as an important retention tool.

The significant terms of the Severance Plan for the Chief Executive Officer and the Company's other named executive officers who participate in the Severance Plan (Mr. Moran and Mr. Pernock (prior to his separation) include the following benefits upon an involuntary termination without cause or resignation for good reason: (1) a cash payment equal to a multiple of annual base salary (1.5x for the Chief Executive Officer and 1.0x for other named executive officers, increased to 2.0x for the Chief Executive Officer and 1.5x for the other named executive officers if such involuntary termination occurs in connection with a change in control); (2) an annual bonus payment, increased 2.0x for the Chief Executive Officer and 1.5x for the other named executive officers if such involuntary termination occurs in connection with a change in control; (3) continued COBRA premium payments for a period of time following termination (18 months for the Chief Executive Officer and 12 months for the other named executive officers, increased to 24 months for the Chief Executive Officer and 18 months for the other NEOs if such involuntary termination occurs in connection with a change in control); and (4) vesting acceleration of time-vesting equity awards either in part or in full (with all time-vesting awards accelerating in full if such involuntary termination occurs in connection with a change in control) and an extended time to exercise stock options. In addition, the Severance Plan provides for vesting acceleration of certain equity awards upon a change in control transaction if such awards are not assumed, continued or substituted for by the acquiring or successor entity or upon death or disability, as well as an extended period of time to exercise stock options following a death or disability. The Severance Plan will terminate on the earlier of the satisfaction of our obligations under the Severance Plan or three years from its effective date.

A more detailed description of the Severance Plan and each of our named executive officer payment and benefits upon a termination or change in control is provided below under "Potential Payments upon Termination or Change in Control."

2021 Executive Departures: Mr. Pernock and Dr. Ng-Cashin

Mr. Pernock ceased serving as our Executive Vice President of Operations on December 31, 2021. In connection with his departure, our compensation committee provided Mr. Pernock with a severance package consisting of (1) 12 month base salary continuation; (2) an amount equal to $614,295 equivalent to approximately 170% of his target bonus; (3) vesting acceleration of time-vesting equity awards for the portion of such awards that would vest over the 12 months following his separation; and (4) an extended time to exercise vested stock options for up to 12 months following his separation date. This severance reflected the severance benefits Mr. Pernock was eligible for under the Severance Plan, except that instead of receiving his target bonus amount, he received a bonus amount approximately equivalent to the bonus that would have been paid to him based on actual company performance during 2021 (which the compensation committee felt was reasonable, given he served for the entirety of the year) and he did not receive any COBRA premium benefits.

Dr. Ng-Cashin ceased serving as our Chief Medical Officer on December 27, 2021. In connection with her departure, our compensation committee provided Dr. Ng-Cashin with a severance package consisting of a cash payment equal to six months of her salary and continued COBRA premium payments for six months in exchange for a release of claims against our Company. The compensation committee determined this level of severance benefits was appropriate for Dr. Ng-Cashin, taking into consideration her length of service with our Company.

Welfare and Health Benefits

Our named executive officers are eligible to participate in all of our benefit plans, such as the 401(k) plan (see the section below titled "401(k) Plan"), medical, dental, vision, short-term disability, long-term disability, group life insurance and our 2014 Employee Stock Purchase Plan, in each case generally on the same basis as other employees. We do not currently have qualified or nonqualified defined benefit plans or deferred compensation plans, nor do we offer pension or other retirement benefits other than our 401(k) plan. Our Board may elect to adopt such plans in the future if it determines that doing so is in our best interests.

Perquisites and Other Benefits

We typically do not offer perquisites or personal benefits to our named executive officers; we may from time to time provide reasonable relocation or signing bonuses to our named executive officers as our compensation committee determines appropriate to assist such individuals to commence employment with us.

401(k) Plan

We maintain a 401(k) profit sharing plan, or the 401(k) plan, for our employees. Our named executive officers are eligible to participate in the 401(k) plan on the same basis as our other employees. The 401(k) plan is intended to qualify as a tax-qualified plan under Section 401(k) of the Internal Revenue Code, or the Code. The 401(k) plan provides that each participant may contribute up to the lesser of 75% of his or her compensation or the statutory limit, which was $19,500 for calendar year 2021. Participants who are 50 years old or older can also make "catch-up" contributions, which in calendar year 2021 was up to an additional $6,500, above the statutory limit. Participant contributions are held and invested, pursuant to the participant's instructions, by the plan's trustee. During 2021, we provided matching contributions equal to 100% of employee contributions for the first 1% of employee’s earnings and 50% of employee contributions for the next 5% of an employee’s earnings. All matching during 2021 was immediately fully vested.

Accounting and Tax Considerations

Under Financial Accounting Standard Board ASC Topic 718, or ASC 718, we are required to estimate and record an expense for each award of equity compensation over the vesting period of the award. We record share-based compensation expense on an ongoing basis according to ASC 718. This calculation is performed for accounting purposes and, as applicable, reported in the compensation tables, even though recipients may never realize any value from their awards.

Under Section 162(m) of the Code, or Section 162(m), compensation paid to each of the Company’s “covered employees” that exceeds $1 million per taxable year is generally non-deductible unless the compensation qualifies for (i) certain grandfathered exceptions (including the “performance-based compensation” exception) for certain compensation paid pursuant to a written binding contract in effect on November 2, 2017 and not materially modified on or after such date or (ii) the reliance period exception for certain compensation paid by corporations that became publicly held on or before December 20, 2019.

Although the compensation committee will continue to consider tax implications as one factor in determining executive compensation, the compensation committee also looks at other factors in making its decisions and retains the flexibility to provide compensation for the Company’s named executive officers in a manner consistent with the goals of the Company’s executive compensation program and the best interests of the Company and its stockholders, which may include providing for compensation that is not deductible by the Company due to the deduction limit under Section 162(m). The compensation committee also retains the flexibility to modify compensation that was initially intended to be exempt from the deduction limit under Section 162(m) if it determines that such modifications are consistent with the Company’s business needs.

Compensation Recovery ("Clawback") Policy

As a public company, if we are required to restate our financial results due to our material noncompliance with any financial reporting requirements under the federal securities laws as a result of misconduct, our Chief Executive Officer and Chief Financial Officer may be legally required to reimburse us for any bonus or other incentive-based or equity-based compensation they receive in accordance with the provisions of section 304 of the Sarbanes-Oxley Act of 2002. Additionally, we intend to implement a Dodd-Frank Wall Street Reform and Consumer Protection Act-compliant compensation recovery ("clawback") policy as soon as, and to the extent that, the requirements of such clawbacks are finalized by the SEC.

Stock Ownership Guidelines

We maintain stock ownership guidelines to help ensure that our senior executive officers and the non-employee members of our Board each maintain an equity stake in our Company, and by doing so, appropriately link their interests with those of our other stockholders. These guidelines require our Chief Executive Officer to own equity interests in our Company with a value equal to six times his base salary, each other senior executive officer to own equity interests with a value equal to two times his or her respective base salary, and all non-employee members of our Board to own equity interests with a value equal to three times their respective director's annual retainer, each as calculated under our policy. The guidelines also require our Chief Executive Officer, senior executive officers and non-employee members of our Board to retain at least 25% of the net "after tax" shares obtained via the exercise of any stock options or vesting of any other company stock awards until the individual meets our prescribed ownership guidelines. Compliance is assessed annually, and executive officers and directors have an initial compliance period (ranging from zero to five years, depending on how long they have been in such capacity with the Company at the time the guidelines are effective) from the date on which they become subject to the guidelines to acquire the required shares, and are allotted a shorter compliance period when an ownership guideline is increased due to a change in base salary, retainer or service status.

Policy on Trading, Pledging and Hedging of Company Stock

Our insider trading policy, which applies to all of our officers, directors, employees and consultants, provides that no officer, director, other employee or consultant of the Company may, at any time, (i) engage in short sales, transactions in put or call options, hedging transactions or other inherently speculative transactions with respect to the Company's stock; or (ii) margin, or make any offer to margin, any of the Company's stock, including without limitation, borrowing against such stock. Our Board is responsible for overseeing the insider trading policy and must approve any waivers of the insider trading policy for officers, directors, employees or consultants. Our Board, after deliberation, has granted our Chief Executive Officer a limited waiver under the policy to pledge a certain number of his shares in connection with a margin account maintained by Mr. Tarriff.

Risk Assessment Concerning Compensation Practices and Policies

Our compensation committee has reviewed our compensation policies and practices to assess whether they encourage our employees to take inappropriate risks. After reviewing and assessing our compensation philosophy, policies and practices, including the mix of fixed and variable, short-term and long-term incentives and overall pay, incentive plan structures, and the checks and balances built into, and oversight of, each plan and practice, our compensation committee has determined that any risks arising from our compensation policies and practices for our employees are not reasonably likely to have a material adverse effect on our Company as a whole.

Further, our compensation committee believes that the mix and design of the elements of executive compensation do not encourage management to assume excessive risks; the mix of short-term compensation (in the form of base salary and an annual performance bonus opportunity, if any, which is based on a variety of performance factors), and long-term compensation prevents undue focus on short-term results and helps align the interests of our executive officers with the interests of our stockholders.

Compensation Committee Interlocks and Insider Participation

None of the members of the compensation committee is currently, or has been at any time, one of our officers or employees. None of our executive officers currently serves, or has served during the last year, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of our Board or compensation committee.

Compensation Committee Report

Our compensation committee has reviewed and discussed with management the foregoing Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K. Based on this review and discussion, our compensation committee has recommended to our Board that the Compensation Discussion and Analysis be included in our proxy statement for our 2022 annual meeting of stockholders and our Annual Report on Form 10-K that we filed with the SEC for the fiscal year ended December 31, 2021.

By the compensation committee of the Board of Eagle Pharmaceuticals, Inc.

Mr. Michael Graves, Chairman (chairman of the compensation committee)

Mr. Richard A. Edlin

Mr. Steven B. Ratoff

Mr. Robert L. Glenning

This report shall not constitute "soliciting material," shall not be deemed "filed" with the SEC and is not to be incorporated by reference into any of our other filings under the Securities Act of 1933, as amended, or the Securities Act, or the Exchange Act, except to the extent that we specifically incorporate this report by reference therein.

Executive Compensation Tables

Our named executive officers for the fiscal year ended December 31, 2021, which consist of our principal executive officer, our principal financial officer, one other executive officer who was serving as executive officer as of December 31, 2021 and two former executive officers, are:

Scott Tarriff, our President and Chief Executive Officer;

Brian Cahill, our Chief Financial Officer;

Michael Moran, our Chief Commercial Officer;

David Pernock, our former President and Chief Operating Officer; and

Judith Ng-Cashin, M.D., our former Executive Vice President and Chief Medical Officer.

Summary Compensation Table

The following table sets forth in summary form information regarding the compensation provided to, or earned by, our named executive officers during the fiscal years ended December 31, 2021, December 31, 2020 and December 31, 2019:

Grants of Plan-Based Awards for Fiscal Year 2021 Table

The following table sets forth information regarding the grants of plan-based awards made during 2021 to our named executive officers.

2021 Outstanding Equity Awards at Fiscal Year-End Table

The following table sets forth certain information regarding equity awards held as of December 31, 2021 by our named executive officers.