UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

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SEAGEN INC.

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Dear Fellow Shareholders:

2020 was a pivotal year for Seagen as we expanded our commercial portfolio and our pipeline, broadened our geographic footprint and augmented our business with strategic partnerships. We successfully launched two important medicines for cancer patients, PADCEV^®, for urothelial (bladder) cancer, and TUKYSA^®, for HER2-positive breast cancer. These products, along with ADCETRIS^®, for blood-related cancers, drove 2020 net product sales to $1 billion. We are focused on maximizing the potential of these products through broad clinical development programs. In addition, we are expanding our global footprint and now have presence across Europe. Recently, we received approval for TUKYSA in the European Union and Great Britain, and we and our partner, Astellas, submitted marketing applications for PADCEV in the European Union and several other ex-U.S. countries. We are committed to bringing these impactful medicines to cancer patients in need.

Beyond our commercial products, we are working to develop additional first-in-class or best-in-class cancer treatments. We and our partner, Genmab, recently submitted a Biologics License Application to the FDA for tisotumab vedotin for women with metastatic cervical cancer. We also established a co-development and co-commercialization agreement with Merck for ladiratuzumab vedotin, our novel antibody-drug conjugate (ADC) targeting breast cancer and other solid tumors. This collaboration, in addition to another agreement with Merck to commercialize TUKYSA outside of the U.S., Canada and Europe, strengthened our balance sheet. We received $725 million in upfront payments and proceeds of $1 billion from an equity investment by Merck.

We are also advancing multiple programs in our earlier-stage pipeline. These product candidates utilize novel technologies, including our industry-leading ADC technology. We believe continued investment in research and development is key to our success and will result in long-term shareholder value.

In response to the global pandemic, we implemented measures focused on protecting the health and safety of our workforce and designed to ensure business continuity. This included requiring most employees to work remotely and providing additional resources for them to successfully conduct their work. For those with roles that required them to be onsite, such as laboratory research personnel, we implemented changes including staggering work times to provide for appropriate distancing and mandatory COVID-19 screening when coming onsite. We also worked diligently across our commercial, clinical and research activities to ensure we continue to advance our programs and deliver our medicines to patients. In addition, we supported our communities through charitable giving including corporate matching campaigns, volunteer programs, and donations to patient organizations to provide financial relief and services to individuals impacted by the pandemic.

During 2020, we furthered our focus on fostering diversity, equity and inclusion at Seagen through a number of initiatives that are discussed further in this proxy statement. We believe this will contribute to our innovation, as well as better represent and serve our stakeholders.

As part of our investor relations activities, we continued our proactive shareholder engagement effort focused on corporate governance, executive compensation, and social topics. These discussions and the feedback we received from investors provided valuable information for senior management and our Board of Directors in their planning and decision making, and continue to influence changes to our practices in these areas.

We hope that you will participate in the Annual Meeting because your vote is important to us. This year, to protect the health and safety of our shareholders and employees and to facilitate shareholder participation despite the global pandemic, the Annual Meeting will be held through a live webcast at www.virtualshareholdermeeting.com/SGEN2021. The following notice of our Annual Meeting contains details of the business to be conducted at the meeting, as well as information regarding how to vote.

 

 

 

 

		2021 NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
		Meeting Date:		May 14, 2021		Meeting Place:		The Annual Meeting will be held online at www.virtualshareholdermeeting.com/SGEN2021
		Meeting Time:		2:30 p.m. (Pacific)
		Record Date:		March 18, 2021

VOTING METHODS

Your vote is very important to us. Whether or not you expect to attend the Annual Meeting online, please ensure your representation and the presence of a quorum at the Annual Meeting by voting via one of the methods listed below, as promptly as possible. If you are an owner of record as of the record date, you may vote via any of the following methods:

 

Via the Internet:		Call Toll-Free:		Mail Signed Proxy Card
www.proxyvote.com		1-800-690-6903		Using the Provided Postage-Paid Envelope

If you are a beneficial owner of shares held through a broker, bank or other owner of record, you must follow the voting instructions you receive from the owner of record to vote your shares.

ATTENDING THE MEETING

To attend the Annual Meeting, access the meeting center at www.virtualshareholdermeeting.com/SGEN2021 and enter the 16-digit control number from your proxy card or Notice of Internet Availability of Proxy Materials.

MEETING AGENDA

The proposals for the Annual Meeting are to:

 

1.	Elect the three nominees for Class II director named in the accompanying proxy statement to hold office until Seagen’s 2024 Annual Meeting of Shareholders.

 

2.	Approve, on an advisory basis, the compensation of Seagen’s named executive officers as disclosed in the accompanying proxy statement.

 

3.	Ratify the appointment of PricewaterhouseCoopers LLP as Seagen’s independent registered public accounting firm for the fiscal year ending December 31, 2021.

 

4.	Transact such other business as may properly come before the Annual Meeting and any adjournment or postponement thereof.

You can find more information about each of these items, including the nominees for directors, in the accompanying proxy statement.

A complete list of the shareholders entitled to vote at the Annual Meeting will be available during the Annual Meeting for examination by any shareholder at www.virtualshareholdermeeting.com/SGEN2021.

 

 

 

		TABLE OF CONTENTS

 

 

 

 

		PROXY STATEMENT SUMMARY

 

The following summary highlights certain information contained elsewhere in this proxy statement and does not contain all of the information you should consider. You should read the entire proxy statement carefully before voting.

 

		2021 ANNUAL MEETING INFORMATION
		Meeting Date:		May 14, 2021		Meeting Place:		The Annual Meeting will be held online at www.virtualshareholdermeeting.com/SGEN2021
		Meeting Time:		2:30 p.m. (Pacific)
		Record Date:		March 18, 2021

VOTING MATTERS

 

Proposals				Board Vote Recommendation		See Page Number   for More Detail
PROPOSAL NO. 1		Election of Class II directors		FOR EACH NOMINEE		Page 8
PROPOSAL NO. 2		Advisory vote on the compensation of our named executive officers		FOR		Page 30
PROPOSAL NO. 3		Ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm		FOR		Page 78

Our proxy materials, which include this proxy statement and our 2020 annual report, are first being mailed or made available to shareholders on or about April 1, 2021.

COMPANY OVERVIEW

Seagen is a global biotechnology company that develops and commercializes targeted therapies to treat cancer. We are commercializing ADCETRIS^® (brentuximab vedotin), for the treatment of certain CD30-expressing lymphomas, PADCEV^® (enfortumab vedotin-ejfv), for the treatment of certain metastatic urothelial cancers, and TUKYSA^® (tucatinib), for treatment of certain metastatic HER2-positive breast cancers. We are also advancing a pipeline of novel therapies for solid tumors and blood-related cancers designed to address unmet medical needs and improve treatment outcomes for patients. Many of our programs, including ADCETRIS and PADCEV, are based on our antibody-drug conjugate, or ADC, technology that utilizes the targeting ability of monoclonal antibodies to deliver cell-killing agents directly to cancer cells.

 

		PROXY STATEMENT SUMMARY

 

BUSINESS HIGHLIGHTS   In 2020, Seagen delivered on multiple important business, regulatory and development milestones. We reported record net product sales of $1 billion driven by the successful launches of PADCEV and TUKYSA and continued growth of ADCETRIS. PADCEV, approved in late 2019 for the treatment of previously treated urothelial (bladder) cancer, and TUKYSA, approved in 2020 for previously treated HER2-positive metastatic breast cancer, address significant unmet patient needs and have been rapidly adopted by oncologists. To build on the potential of our three approved drugs, we are conducting clinical trials in earlier lines and stages of disease as well as in other cancer types.   We are also extending the availability of our products outside of the U.S. and recently received approval of TUKYSA in the European Union and United Kingdom. Additionally, in 2020 we entered into a strategic collaboration with Merck for TUKYSA commercialization beyond the U.S, Canada and Europe. For PADCEV, in early 2021 we and our partner Astellas submitted marketing applications for approval in the European Union and Japan. ADCETRIS use continues to expand globally, and in 2020 our partner Takeda received approval in China.   Over the past year, we have also made significant progress in advancing our late-stage pipeline. In early 2021, we and our partner Genmab submitted a Biologics License Application to the FDA for tisotumab vedotin based on positive results from a pivotal trial in metastatic cervical cancer in women who progress following first-line

treatment. We also established an important strategic partnership with Merck to co-develop and co-commercialize ladiratuzumab vedotin, which is in development for breast cancers and other solid tumors. Under this collaboration and the TUKYSA commercial agreement with Merck we received $725 million in upfront payments and, in connection with the ladiratuzumab vedotin collaboration, Merck made a $1 billion equity investment in Seagen.

Our earlier-stage pipeline is robust, with seven clinical-stage and multiple preclinical programs in development for a range of solid tumors and hematologic malignancies. Our product candidates include both ADCs as well as other types of empowered antibodies. We are making significant investment in our pipeline and technologies as we believe it is important to ensuring long-term growth.

Our accomplishments in 2020 and early 2021 required us to address the impact of the global pandemic on our business. This included proactive efforts designed to protect the health and safety of our workforce, patients and healthcare professionals and ensure business continuity while we advance our goal of bringing important medicines to patients in need. Entering 2021, we will continue to closely monitor and respond to any further impacts of the global pandemic, while focusing on our strategic priorities to maximize the global potential of our approved medicines, advance our late-stage programs and expand our early-stage pipeline.

 

		PROXY STATEMENT SUMMARY

 

 

		PROXY STATEMENT SUMMARY

 

GOVERNANCE HIGHLIGHTS

Our Board of Directors is committed to building long-term shareholder value and maintaining sound corporate governance practices. We highlight some of our corporate governance practices below.

 

Number of directors			9
Percentage of directors who are independent			89%
Directors who attended at least 75% of board and committee meetings			ALL
Strong and active lead independent director			✓
100% independent audit, compensation and nominating and corporate governance committees			✓
Board and committees may engage outside advisors independent of management			✓
Adopted a policy to instruct search firms to include diverse candidates in director candidate pools			✓
Corporate governance guidelines formalize policy of considering diversity of race, ethnicity, gender, age and sexual orientation in selecting director nominees			✓
Annual Board self-evaluations			✓
Active shareholder engagement program			✓
Corporate governance guidelines			✓
Majority voting in uncontested elections			✓
All employees, officers and directors must adhere to a Code of Conduct and Business Ethics			✓

 

		PROXY STATEMENT SUMMARY

 

SHAREHOLDER ENGAGEMENT

In 2020, we continued our proactive shareholder outreach program to solicit feedback and better understand investor perspectives on operational, governance and executive compensation matters. We held discussions with a number of our shareholders in the spring before the Annual Meeting and again in late fall. Our cross-functional team that participated in these discussions to address investors’ specific focus areas included executives from our Investor Relations, Human Resources and Legal departments as well as our Chief Financial Officer. Feedback from these engagement activities was shared with management and our Board of Directors to inform our goal of aligning Company interests with those of our shareholders. Investor feedback is important to us, and we are committed to continuing to engage with our shareholders in the future to understand and consider their views.

2020 SHAREHOLDER ENGAGEMENT EFFORT

 

 

SHAREHOLDER FEEDBACK

In 2020, these discussions covered a wide range of topics, including:

 

 

OUTCOMES OF ENGAGEMENT

The feedback from discussions with shareholders led to changes in 2020 to our executive compensation program and corporate governance practices, as described below.

 

Executive   Compensation		•  Incorporated performance-based equity awards into the annual long-term incentive awards for all executives serving on our executive committee, including all of our named executive officers
Corporate   Governance		•  Formally adopted a policy to instruct third-party search firms to include women and candidates from underrepresented communities in the pool as part of director nominee searches   •  Revised our Code of Conduct and Business Ethics, including updates to reflect our global expansion   •  Enhanced our disclosure on diversity, equity and inclusion (please see “Diversity, Equity and Inclusion” below in this proxy statement) and human capital management (please see “Business—Human Capital Resources” in our Annual Report on Form 10-K)   •  In recognition of shareholder feedback about director board commitments, Dr. Simonian has committed to reduce the number of public company boards on which she serves prior to the end of the year

 

		PROXY STATEMENT SUMMARY

 

2020 COMPENSATION HIGHLIGHTS

We endeavor to maintain sound executive compensation policies and practices consistent with our executive compensation philosophy. The following table highlights some of our executive compensation policies and practices, which are structured to drive performance and align our executives’ interests with our shareholders’ long-term interests. For more detailed information, please see the discussion under “Compensation Discussion and Analysis—Our Executive Compensation Practices.”

 

		WHAT WE DO				WHAT WE DON’T DO
				Pay for Performance				No Special Health or Welfare Benefits for Executives
				Significant Portion of Compensation is at Risk				No Post-Employment Tax Gross-Ups
				Double-Trigger Vesting				No Hedging or Pledging of Our Stock Permitted
				Independent Compensation Committee				No Stock Option Repricing
				Independent Compensation Advisor Reports Directly to the Compensation Committee
				Annual Market Review of Executive Compensation
				Stock Ownership Guidelines for Directors and Executive Officers
				Multi-Year Vesting Requirements
				Annual Say-on-Pay Vote
				Active Shareholder Engagement Program
				Clawback Policy
				Cap on Annual Cash Bonuses
				Minimize Inappropriate Risk Taking
				Competitive Peer Group

 

		PROXY STATEMENT SUMMARY

 

ALIGNMENT OF CEO PAY TO TOTAL SHAREHOLDER RETURN

We design our executive compensation program to align pay with company performance, and as highlighted in the charts below, there is strong alignment between the two. The charts below show the relative degree of alignment between our CEO’s total compensation and our total shareholder return, or TSR, over the one- and three- year periods ended December 31, 2020. TSR is calculated by dividing the change in share price over the relevant period by the initial share price. For comparison purposes, the charts below also show the relative degree of alignment between the total compensation of the CEOs of the companies in our compensation peer group over the one- and three-year periods ended December 31, 2019, which are the most recent periods for which data was available to the Compensation Committee when making pay decisions in August 2020, and the TSRs of the companies in our compensation peer group over the one- and three-year periods ended December 31, 2020. For more information on our pay elements and our compensation decision making process, including our compensation peer group, please see “Executive Compensation—Compensation Discussion and Analysis—Principal Elements of Pay” and “Executive Compensation—Compensation Discussion and Analysis —Compensation-Setting Process” below.

 

 

CERTAIN DEFINED TERMS

In this Proxy Statement:

 

•

“We,” “us,” “our”, the “Company” and “Seagen” refer to Seagen Inc. and its wholly-owned subsidiaries on a consolidated basis;

 

•

“Annual Meeting” means our 2021 Annual Meeting of Shareholders;

 

•

“Board of Directors” or “Board” means our Board of Directors; and

 

•

“SEC” means the Securities and Exchange Commission.

 

 

PROPOSAL NO. 1

ELECTION OF DIRECTORS

Our Board of Directors is divided into three equal classes with staggered three-year terms, as shown in the table below:

 

Director Nominee		Class		Age*		Position		Director Since		Current Term Expires		Expiration of Term for Which Nominated
Felix J. Baker, Ph.D.		II		52		Lead Independent Director		2003		2021		2024
Clay B. Siegall, Ph.D.		II		60		President, CEO and Chairman of the Board		1997		2021		2024
Nancy A. Simonian, M.D.		II		60		Director		2012		2021		2024
Director
Marc E. Lippman, M.D.		III		76		Director		2000		2022
Ted Love, M.D.		III		62		Director		2020		2022
Daniel G. Welch		III		63		Director		2007		2022
David W. Gryska		I		65		Director		2005		2023
John A. Orwin		I		56		Director		2014		2023
Alpna H. Seth, Ph.D.		I		57		Director		2018		2023

 

*	Ages as of April 1, 2021

If elected at the Annual Meeting, each of the above director nominees would serve until the 2024 Annual Meeting of Shareholders and until the director’s successor is elected and has qualified, or, if sooner, until the director’s death, resignation or removal.

As this is an uncontested election, each nominee for director must receive a majority of the votes cast in order to be elected, meaning the number of shares voted “for” each nominee must exceed the number of shares voted “against” such nominee.

In addition, under our Corporate Governance Guidelines, any nominee for director who receives a greater number of votes “against” his or her election than votes “for” such election is required to submit an offer of resignation for consideration by the Nominating and Corporate Governance Committee, or the Governance Committee. In such case, the Governance Committee will then consider all of the relevant facts and circumstances and recommend to the full Board the action to be taken with respect to such offer of resignation.

If any nominee is unavailable for election due to an unexpected occurrence, such shares will be voted for the election of such substitute nominees as the Governance Committee may propose. Proxies may not be voted for a greater number of persons than the number of nominees named. Each person nominated for election has consented to being named as a nominee in this proxy statement and has agreed to serve if elected, and management has no reason to believe that any nominee will be unable to serve.

 

		The Board recommends a vote FOR all three of the nominees for director named above.

 

NOMINEES FOR THE BOARD OF DIRECTORS AND CONTINUING DIRECTORS

 

NOMINEES FOR THE BOARD OF DIRECTORS AND CONTINUING DIRECTORS

The names of the nominees and of the directors whose terms of office will continue after the Annual Meeting, their ages as of April 1, 2021, and certain other information about them are set forth below. Such information includes the specific and particular experience, qualifications, attributes or skills of each nominee and continuing director that led the Governance Committee and the Board to believe that such nominee or continuing director should continue to serve on the Board as of the date of this proxy statement.

DIRECTOR NOMINEE PROFILES

 

		FELIX J. BAKER, PH.D.                                                                     LEAD INDEPENDENT DIRECTOR

								KEY QUALIFICATIONS		RECENT EXPERIENCE
				Age: 52   Director Since: 2003   Term Expires: 2021   Committees: •  Compensation (Chair)    •  Governance				As a board member and investor in many successful biotechnology companies, Dr. Baker is able to draw on his experience and vision in investing in and building companies to add significant value to Board of Directors discussions and company strategy.		Baker Bros. Advisors LP, a biotechnology investment firm   •  Founder and Co-Managing Member (2000-present)   OTHER PUBLIC COMPANY BOARDS   Current   •  IGM Biosciences, Inc.   •  Kiniksa Pharmaceuticals, Ltd.   •  Kodiak Sciences Inc.   •  Talis Biomedical Corporation   Past 5 Years   •  Alexion Pharmaceuticals, Inc.   •  Genomic Health, Inc.

 

		NOMINEES FOR THE BOARD OF DIRECTORS AND CONTINUING DIRECTORS

 

DIRECTOR NOMINEE PROFILES

 

		CLAY B. SIEGALL, PH.D.                                                                          CHAIRMAN OF THE BOARD

								KEY QUALIFICATIONS		RECENT EXPERIENCE
				Age: 60   Director Since: 1997   Term Expires: 2021				Dr. Siegall’s experience in founding and building Seagen is integral to our success and our mission. His scientific understanding along with his corporate vision and operational knowledge provide strategic insights to our Board of Directors.		Seagen Inc.   •  Chairman of the Board (2004-present)   •  Chief Executive Officer (2002-present)   •  President (2000-present)   •  Chief Scientific Officer (1997-2002)   •  Co-founder (1997-present)   OTHER PUBLIC COMPANY BOARDS   Current   •  Ultragenyx Pharmaceutical Inc.   Past 5 Years   •  Alder BioPharmaceuticals, Inc.   •  Mirna Therapeutics, Inc.

		NANCY A. SIMONIAN, M.D.                                                                                           INDEPENDENT

								KEY QUALIFICATIONS		RECENT EXPERIENCE
				Age: 60   Director Since: 2012   Term Expires: 2021   Committees: •  Governance (Chair)				As a current and former senior executive of several other biotechnology companies, including Syros Pharmaceuticals, Inc., Millennium Pharmaceuticals, Inc. and Biogen, Inc., Dr. Simonian possesses a strong understanding of the biotechnology industry and the development and commercialization of our product candidates. Her knowledge of late-stage product development, as former Chief Medical Officer of Millennium Pharmaceuticals, Inc., and her understanding of patient perspectives as a medical doctor, bring important insights to our Board of Directors.		Syros Pharmaceuticals, Inc., a publicly-traded life sciences company   •  Chief Executive Officer (2012-present)   Millennium Pharmaceuticals, Inc., an affiliate of The Takeda Oncology Company   •  Chief Medical Officer (2006-2011)   OTHER PUBLIC COMPANY BOARDS   Current*   •  Evelo Biosciences, Inc.   •  Syros Pharmaceuticals, Inc.   * Dr. Simonian has committed to reduce the total number of public company boards on which she serves to two prior to the end of the year.

 

NOMINEES FOR THE BOARD OF DIRECTORS AND CONTINUING DIRECTORS

 

CONTINUING DIRECTOR PROFILES

 

		DAVID W. GRYSKA                                                                                                              INDEPENDENT

								KEY QUALIFICATIONS		RECENT EXPERIENCE
				Age: 65   Director Since: 2005   Term Expires: 2023   Committees: •  Audit (Chair)				Mr. Gryska has years of experience as Chief Financial Officer at Incyte Corporation, Celgene Corporation, Scios, Inc., and Cardiac Pathways Corporation. He brings to the Board valuable and relevant experience as a senior financial executive at life sciences and biotechnology companies engaged in financings, global expansion and other strategic transactions. He also has extensive knowledge of accounting principles and financial reporting rules and regulations, tax compliance and oversight of the financial reporting processes of several large, publicly-traded corporations, which assists Mr. Gryska in fulfilling his duties as chair of our Audit Committee.		Incyte Corporation, a publicly-traded biopharmaceutical company   •  Executive Vice President and Chief Financial Officer (2014-2018; retired)   Myrexis, Inc., a publicly-traded biotechnology company   •  Chief Operating Officer and Interim Chief Executive Officer (2012)   Celgene Corporation, a publicly-traded biopharmaceutical company   •  Senior Vice President and Chief Financial Officer (2006-2010)   OTHER PUBLIC COMPANY BOARDS   Current   •  Aerie Pharmaceuticals, Inc.   •  GW Pharmaceuticals plc   Past 5 Years   •  PDL BioPharma, Inc.

				MARC E. LIPPMAN, M.D.                                                                                                INDEPENDENT

								KEY QUALIFICATIONS		RECENT EXPERIENCE
				Age: 76   Director Since: 2000   Term Expires: 2022   Committees: •  Governance				Dr. Lippman’s extensive experience in treating patients and conducting oncology research at the National Cancer Institute and at the medical schools of the University of Miami, the University of Michigan and Georgetown University provides an important patient perspective and focus on innovation in our development of targeted oncology therapies.		Georgetown University Medical Center’s Lombardi Comprehensive Cancer Center   •  Professor of Oncology (2018-present)   University of Miami Leonard M. Miller School of Medicine   •  Kathleen and Stanley Glaser Professor of Medicine and Chairman of the Department of Medicine (2017-2018)   •  Deputy Director of the Sylvester Comprehensive Cancer Center (2008-2017)   OTHER PUBLIC COMPANY BOARDS   •  None

 

		NOMINEES FOR THE BOARD OF DIRECTORS AND CONTINUING DIRECTORS

 

CONTINUING DIRECTOR PROFILES

 

		TED LOVE, M.D.                                                                                                                    INDEPENDENT
						KEY QUALIFICATIONS		RECENT EXPERIENCE
		Age: 62   Director Since: 2020   Term Expires: 2022   Committees: •  Audit				Dr. Love has more than twenty years of leadership and management experience in the pharmaceutical industry, including Global Blood Therapeutics, Inc. and Onyx Pharmaceuticals, Inc., in addition to his prior experience as a practicing physician. He brings both strong business expertise and knowledge of patient perspectives to our Board of Directors.		Global Blood Therapeutics, Inc., a publicly-traded biopharmaceutical company   •  President and Chief Executive Officer (2014-present)   Onyx Pharmaceuticals, Inc.   •  Executive Vice President, Research and Development and Technical Operations (2010-2012)   OTHER PUBLIC COMPANY BOARDS   Current   •  Global Blood Therapeutics, Inc.   •  Royalty Pharma plc   Past 5 Years   •  Amicus Therapeutics, Inc.   •  Cascadian Therapeutics, Inc.   •  Portola Pharmaceuticals, Inc.

 

		JOHN A. ORWIN                                                                                                                  INDEPENDENT
						KEY QUALIFICATIONS		RECENT EXPERIENCE
		Age: 56   Director Since: 2014   Term Expires: 2023   Committees: •  Compensation				Mr. Orwin has many years of experience as a senior executive at leading pharmaceutical and biotechnology companies, including Atreca, Inc., Relypsa, Inc., Affymax, Inc., Genentech, Inc., and Johnson & Johnson. This gives him a strong understanding of the biotechnology industry and the challenges we must meet in order to continue developing and commercializing ADCETRIS, PADCEV, TUKYSA and our product candidates.		Atreca, Inc., a publicly-traded biopharmaceutical company   •  President and Chief Executive Officer (2018-present)   Relypsa, Inc., now an affiliate of Vifor Pharma AG, a Swiss-listed public company   •  Chief Executive Officer (2013-2017)   Affymax, Inc., a biotechnology company   •  Board member (2011-2014)   •  Chief Executive Officer (2011-2013)   •  President and Chief Operating Officer (2010-2011)   Genentech, Inc., now a member of the Roche Group   •  Vice President and then Senior Vice President of the BioOncology Business Unit (2005-2010)   OTHER PUBLIC COMPANY BOARDS   Current   •  Atreca, Inc.   •  Travere Therapeutics, Inc.   Past 5 Years   •  Array BioPharma Inc.

 

NOMINEES FOR THE BOARD OF DIRECTORS AND CONTINUING DIRECTORS

 

CONTINUING DIRECTOR PROFILES

 

		ALPNA H. SETH, PH.D.                                                                                                      INDEPENDENT

								KEY QUALIFICATIONS		RECENT EXPERIENCE
				Age: 57   Director Since: 2018   Term Expires: 2023   Committees:       •  Audit				Dr. Seth has over 20 years of global experience in the biotechnology industry. Having held a range of leadership roles around the globe, Dr. Seth brings a breadth of experience in drug development, commercial, international operations and general management.		Nura Bio Inc. (formerly Proneurotech Inc.), a private biotechnology company   •  Chief Executive Officer and President (2019-present)   Vir Biotechnology, Inc., now a publicly traded biopharmaceutical company   •  Chief Operating Officer (2017-2019)   Biogen, Inc., a publicly-traded biotechnology company   •  Senior Vice President and Global Head of the Biosimilars Global Business Unit (2014-2017)   •  Range of leadership roles in business development, drug development and commercial (1998-2014)     OTHER PUBLIC COMPANY BOARDS   Current   •  Bio-Techne Corporation

		DANIEL G. WELCH                                                                                                            INDEPENDENT

								KEY QUALIFICATIONS		RECENT EXPERIENCE
				Age: 63   Director Since: 2007   Term Expires: 2022   Committees:       •  Compensation				Mr. Welch’s global commercial background and strong senior executive experience at a wide range of biotechnology companies, including previously serving as Chairman and Chief Executive Officer of two publicly-traded biotechnology companies, InterMune, Inc. and Triangle Pharmaceuticals, Inc., gives him insight into strategy and planning for a biopharmaceutical company that is valuable to our senior management and our Board of Directors.		Sofinnova Ventures, a venture capital firm   •  Executive Partner (2015-2018; retired)   InterMune, Inc., a publicly-traded biotechnology company   •  Chief Executive Officer and President (2003-2014)   •  Chairman of the Board (2007-2014)   OTHER PUBLIC COMPANY BOARDS   Current   •  Intercept Pharmaceuticals, Inc.   •  Nuvation Bio Inc. (Chairman of the Board)   •  Ultragenyx Pharmaceutical, Inc. (Chairman of the Board)   Past 5 Years   •  Avexis, Inc.

 

		CORPORATE GOVERNANCE

 

CORPORATE GOVERNANCE

Our Board of Directors is committed to building long-term shareholder value and maintaining sound corporate governance practices. In furtherance of this commitment, we regularly monitor developments in the area of corporate governance and review our processes, policies and procedures in light of such developments.

DIRECTOR INDEPENDENCE; AUDIT COMMITTEE FINANCIAL EXPERT

Our Board of Directors has determined that all of our directors are independent directors within the meaning of Rule 5605(a)(2) of the Nasdaq listing standards, except for Clay B. Siegall, our President and Chief Executive Officer. Our Board of Directors considered Dr. Baker’s role as a Co-Managing Member of Baker Brothers Investments, and the relationship Seagen has with Baker Brothers Investments and affiliated entities as significant shareholders in making the determination that Dr. Baker is independent.

Our Board of Directors has also determined that all of the members of the Compensation Committee currently serving are independent under the additional criteria for members of the Compensation Committee under the Nasdaq listing standards. In the case of Dr. Baker, our Board of Directors determined that, given his affiliation with our largest shareholder, his interests are aligned with other shareholders in seeking an appropriate executive compensation program for Seagen. In addition, the Board of Directors has determined that all of the members of the Audit Committee are independent within the meaning of Rules 5605(c)(2)(A)(i) and (ii) of the Nasdaq listing standards and that Mr. Gryska is an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. There are no family relationships among any of the directors or executive officers of Seagen.

BOARD LEADERSHIP STRUCTURE

Our Board of Directors has chosen to combine the principal executive officer and Board chairman positions and, in addition, has appointed a separate lead independent director. Dr. Siegall has served as our principal executive officer and Board chairman since 2004. At the present time, the independent directors believe that Dr. Siegall’s in-depth knowledge of our operations and vision for our development make him the best-qualified director to serve as Board chairman. We believe that combining the positions of chief executive officer and Board chairman provides a single, clear chain of command to execute our strategic initiatives and business plans. In addition, we believe that a combined chief executive officer/Board chairman is better positioned to act as a bridge between management and the Board, facilitating the regular flow of information. We also believe that it is advantageous to have a Board chairman with an extensive history with and knowledge of Seagen (as is the case with our chief executive officer) as compared to an independent Board chairman with less direct involvement.

Under our Corporate Governance Guidelines, when the Board chairman also serves as our chief executive officer or as another executive officer of Seagen, the Board may designate an independent director who acts as a lead independent director. The position of lead independent director has been structured to serve as an effective balance to a combined chief executive officer/Board chairman. In addition, we believe that having a lead independent director, who is independent of management, creates an environment that is more conducive to objective evaluation and oversight of management’s performance, increasing management accountability and improving the ability of the Board of Directors to monitor whether management’s actions are in the best interests of Seagen and its shareholders. Since February 2005, Dr. Baker has served as the lead independent director of the Board. His formal and informal duties include, among others:

 

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providing leadership to the Board complementary to the Board chairman;

 

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working with the Board chairman and Corporate Secretary to set the agenda for Board meetings;

 

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serving as the principal liaison between the independent directors and the Board chairman;

 

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calling meetings of the independent directors;

 

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chairing meetings of independent directors without management present;

 

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chairing Board meetings if the Board chairman is not in attendance;

 

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if requested by shareholders, ensuring that he is available, when appropriate, for consultation and direct communication; and

 

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reviewing and providing input on Board meeting schedules.

 

CORPORATE GOVERNANCE

 

In addition, as chair of our Compensation Committee, Dr. Baker provides additional oversight of management by leading the annual evaluation of the pay and performance of our chief executive officer and our other executive officers.

DIRECTOR COMMITMENTS

Our Board only nominates candidates who it believes will be able to devote sufficient time and attention to fulfill their duties, taking into account each candidate’s principal occupation, other board service, attendance and performance. In 2020, based on discussions during shareholder engagements, as well as our Governance Committee’s review of institutional and proxy advisory firms’ policies on director time commitments and the policies of peers and other public companies, our Governance Committee and Board revised our Corporate Governance Guidelines as outlined below. All of our directors are in compliance with this policy.

 

Director who also serves as a Section 16 executive officer of a public company		£3 public company boards including our Board unless approved in advance by our Board
Director who is not an Executive Officer		£5 public company boards including our Board unless approved in advance by the Board

Non-employee directors are required to notify the Governance Committee if they:

 

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retire from their executive positions at outside companies;

 

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change the position they held when they became a member of the Board; or

 

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join the board of a private or public company.

After receiving such a notice, the Governance Committee will review the appropriateness of continued Board membership under the circumstances and the affected director will be expected to act in accordance with the Governance Committee’s recommendation.

We are aware that some shareholders have policies that are more restrictive than our policy on director commitments. Over the past year, our Governance Committee has continued to review shareholder policies on director time commitments. We also discussed this topic during shareholder engagements.

Our Governance Committee and Board believe that each of our directors has demonstrated an ongoing commitment and ability to devote ample time and attention to their duties as directors of Seagen based on their exemplary participation in meetings of our Board and, where applicable, the Board committees on which they serve. Each of our directors also brings important expertise and experience to Seagen, as described more fully under “Nominees for the Board of Directors and Continuing Directors” above in this proxy statement. The Board believes that it is in the Company’s best interest that each of our current directors continue to serve on our Board. In addition, as indicated above, our Board continues to actively discuss the topic of director commitments in light of evolving shareholder positions on this topic. In 2020, the Chair of our Governance Committee, Dr. Simonian, committed to reduce the total number of public company boards on which she serves to two, prior to the end of this year.

 

		CORPORATE GOVERNANCE

 

BOARD COMMITTEES

The Board has a standing Audit Committee, Compensation Committee and Governance Committee, each of which is made up solely of independent directors. Each of these committees operates under a written charter setting forth the functions and responsibilities of the committee, which is available on our website at www.seagen.com.

 

		AUDIT COMMITTEE
		Chair: David W. Gryska   Other Members: Ted Love* Alpna H. Seth				KEY FUNCTIONS
						•  appoint and establish the fees for our independent registered public accounting firm;   •  review and approve the procedures we use to prepare our periodic and annual reports;     •  review and discuss with management and our independent auditor our quarterly earnings release, financial statements, and related periodic SEC filings;   •  review our critical accounting policies and critical audit matters;   •  review the independence of the independent registered public accounting firm in accordance with the Public Company Accounting Oversight Board;   •  monitor the effectiveness of the audit effort; and   •  oversee our financial and accounting organization, our system of internal accounting controls and our internal audit function.

 

*	Mr. Orwin served as a member of the Audit Committee until September 2020, when Dr. Love joined the Audit Committee.

 

 

		COMPENSATION COMMITTEE
		Chair: Felix J. Baker   Other Members: John A. Orwin Daniel G. Welch				KEY FUNCTIONS
						•  review and advise the Board regarding the performance of the CEO and other executive officers;   •  review overall corporate performance against goals and determine corporate payout factor used for annual executive and nonexecutive bonuses;   •  review and determine the compensation to be paid to the Company’s executive officers;   •  establish and administer our policies regarding annual executive salaries, cash incentives and long-term equity incentives;   •  oversee our equity plans, long-term incentive plans, executive bonus plan and other compensation policies, plans and programs;   •  review with management our Compensation Discussion and Analysis; and   •  review the compensation paid to our directors.

 

CORPORATE GOVERNANCE

 

		GOVERNANCE COMMITTEE
		Chair: Nancy A. Simonian   Other Members: Felix J. Baker Marc E. Lippman				KEY FUNCTIONS
						•  identify and evaluate individuals qualified to serve as members of the Board of Directors and consider board composition, including evaluating incumbent directors for re-election;   •  recommend nominees to the Board for election as directors of Seagen and appointment as members of the committees of the Board of Directors;   •  develop and make recommendations to the Board regarding the Company’s Corporate Governance Guidelines and provide oversight with respect to corporate governance and ethical conduct; and   •  oversee an annual evaluation of the performance of the Board.

BOARD AND COMMITTEE MEETINGS AND ATTENDANCE

The Board met nineteen times and acted by written consent four times during 2020. On at least a quarterly basis, the Board meets in executive sessions of independent directors without management present. During 2020, the Audit Committee held five meetings and acted by written consent two times, the Compensation Committee held eight meetings and acted by written consent four times and the Governance Committee met twice and acted by written consent two times. Each of our directors attended at least 75% of the aggregate of Board and applicable committee meetings during his or her service on the Board or applicable committees during 2020.

Although we do not have a formal policy regarding attendance by members of the Board of Directors at our annual meetings of shareholders, directors are encouraged to attend. Six of the directors then serving on our Board attended the 2020 Annual Meeting of Shareholders.

BOARD RISK OVERSIGHT

Our Board of Directors has overall responsibility for risk oversight with a focus on the most significant risks facing Seagen. Throughout the year, the Board and the committees to which it has delegated responsibility dedicate a portion of their meetings to reviewing and discussing specific risk topics in greater detail. Strategic and operational risks are presented and discussed in the context of the Chief Executive Officer’s report on operations to the Board at regularly scheduled Board meetings and at presentations to the Board and its committees by the respective committee chairs, our Chief Financial Officer, our General Counsel and Executive Vice President, Legal Affairs, and other officers. In addition, management periodically reports to the Board on enterprise risk management. Our Board also retains responsibility for assessment of succession-related risks and succession planning.

The Board has delegated responsibility for the oversight of specific risks to Board committees as follows:

 

Audit Committee		•  Reviews and oversees risks related to cybersecurity and compliance matters, including but not limited to, Foreign Corrupt Practices Act compliance.   •  Reviews and oversees related-party transactions on behalf of Seagen.
Compensation   Committee		•  Evaluates the risks and rewards associated with our compensation philosophy and programs.   •  Reviews and approves compensation programs with features that mitigate risk without diminishing the  incentive nature of the compensation. For more detail see “Compensation of Executive Officers—Compensation Discussion and Analysis—Compensation and Risk,” below in this proxy statement.   •  Discusses with management the procedures that have been put in place to identify and mitigate potential  risks in compensation.
Governance   Committee		•  Oversees risks related to Seagen’s governance structure and processes, board composition,  refreshment and committee leadership.

 

		CORPORATE GOVERNANCE

 

In addition, our General Counsel and Executive Vice President, Legal Affairs works with our committees and Board to develop risk identification, risk management and risk mitigation strategies and reports periodically to the Board and the committees on Seagen’s risk profile and various management and mitigation strategies.

COMPENSATION COMMITTEE PROCESS AND PROCEDURES

Information on the Compensation Committee’s processes and procedures for consideration of executive compensation are addressed in “Compensation Discussion and Analysis” below. For information regarding our processes and procedures for the consideration and determination of director compensation, please see “Director Compensation” below. In accordance with its charter, the Compensation Committee may delegate any of its authority or responsibility as appropriate, except to the extent inconsistent with any applicable laws and rules, including the Nasdaq listing standards. Our Compensation Committee does not, however, delegate any of its functions to others in determining or recommending executive or director compensation.

BOARD REFRESHMENT

Under our Corporate Governance Guidelines, our Governance Committee is responsible for assessing the appropriate balance of experience, skills and characteristics required of the Board. In this regard, our Governance Committee identifies and evaluates individuals qualified to serve as Board members, including evaluating incumbent directors for re-election, and recommends to the Board nominees for election as directors. On an annual basis, our Governance Committee is tasked with considering and articulating the qualities, experiences, skills and attributes that qualify each director to be a member of the Board in light of our business and structure and assessing its effectiveness in diversifying the Board. Our Governance Committee also oversees an annual Board self-evaluation process. Director responses are collated into a summary by an outside third party, and the results are discussed with the full Board.

CRITERIA FOR BOARD MEMBERSHIP

The Governance Committee assesses many characteristics and diversity considerations when reviewing director candidates and these characteristics are set forth in our Corporate Governance Guidelines. Among the characteristics to be considered are:

 

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professional background;

 

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depth and breadth of experience;

 

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wisdom;

 

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sound business judgment;

 

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integrity;

 

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collegiality;

 

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ability to make independent analytical inquiries;

 

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understanding of the Company’s business environment;

 

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familiarity with the biotechnology industry;

 

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willingness to devote adequate time to Board duties;

 

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the interplay of the candidate’s experience and skills with those of other Board members; and

 

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the extent to which a candidate would be a desirable addition to the Board and any committees of the Board.

Our Corporate Governance Guidelines further provide that the Governance Committee seeks nominees with:

 

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a broad range of experience, viewpoints, professions, skills, geographic representations and cultural backgrounds; and

 

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diversity of race, ethnicity, gender, age and sexual orientation.

We believe that the backgrounds and qualifications of our directors, considered as a group, should provide a significant composite mix of experience, knowledge and abilities that will allow the Board to fulfill its responsibilities and should represent an appropriate balance between institutional knowledge and fresh perspectives.

 

CORPORATE GOVERNANCE

 

BOARD SKILLS AND EXPERIENCE

 

Baker

Gyrska

Lippman

Love

Orwin

Seth

Siegall

Simonian

Welch

CEO/CFO Leadership Experience serving as a chief executive officer or chief financial officer at a publicly traded or private organization

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Financial / Accounting Experience or expertise in financial accounting and reporting processes or the financial management of an organization

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Scientific Scientific expertise related to the healthcare industry

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Healthcare Industry Experience with complex issues within the healthcare industry

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Regulatory Experience with regulation in the healthcare industry

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Business Strategy / Operations Experience overseeing and/or driving strategic direction and growth of an organization

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Public Company Governance Experience as a board member of another public company

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Capital Markets Experience Experience in capital market transactions or mergers and acquisitions

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BOARD COMPOSITION

 

 

 

		CORPORATE GOVERNANCE

 

DIRECTOR NOMINATION PROCESS

The Governance Committee identifies nominees by first evaluating the current members of the Board willing to continue in service. Current members of the Board with skills and experience that are relevant to our business and who are willing to continue in service are considered for re-nomination. In determining whether to recommend a director for re-election, the Governance Committee considers the director’s past attendance at meetings and participation in and contributions to the activities of the Board and its committees, as well as the nature and time involved in a director’s service on other boards. It also considers the overall composition of the Board, including considerations of refreshment and diversity. If there is a vacancy on the Board as a result of a resignation or otherwise, or if the Board decides not to nominate a member for re-election or decides to add a member to the Board, the Governance Committee identifies the desired skills and experience of a new nominee in light of the criteria above and the Board’s needs. Current members of the Board are asked to submit suggestions as to individuals meeting the criteria described above.

 

 

In February 2021, in order to advance our efforts to promote a diverse set of directors, our Board revised our Corporate Governance Guidelines to implement a policy that, when a third-party search firm is engaged and requested to furnish a list of possible director candidates, the firm will be instructed to include women and candidates from underrepresented communities who meet the applicable business and search criteria.

SHAREHOLDER DIRECTOR NOMINATIONS AND RECOMMENDATIONS

In accordance with our bylaws and applicable law, nominations for directors may be made by any shareholder of record entitled to vote for the election of directors at shareholder meetings held for such purpose. The requirements a shareholder must follow for nominating persons for election as directors are set forth in our bylaws and under the heading “Frequently Asked Questions and Other Information—When are proposals and nominations due for the 2022 Annual Meeting?” below in this proxy statement.

The Governance Committee will also consider director candidates recommended by shareholders. In order to recommend director candidates to the Governance Committee, shareholders should follow the procedures in our bylaws for director nominations. If a shareholder complies with these procedures for recommending persons for election as directors, the Governance Committee will conduct the appropriate and necessary inquiries into the backgrounds, qualifications and skills of the recommended candidates and, in the exercise of the Governance Committee’s independent judgment in accordance with the policies and procedures adopted in the Governance Committee’s charter, will determine whether to recommend the candidate(s) recommended by the shareholders to the Board for inclusion in the list of candidates for election as directors at the next shareholder meeting held to elect directors. The Governance Committee does not intend to alter the manner in which it evaluates director candidates based on whether or not the candidate was recommended by a shareholder.

 

CORPORATE GOVERNANCE

 

COMMUNICATIONS WITH THE BOARD OF DIRECTORS

Our Board of Directors currently does not have a formal process for shareholders to send communications to the Board of Directors. Nevertheless, efforts are made to ensure that the views of shareholders are heard by the Board or individual directors, as applicable, and that appropriate responses are provided to shareholders on a timely basis. The Board does not recommend that formal communication procedures be adopted at this time because it believes that informal communications are sufficient to communicate questions, comments and observations that could be useful to the Board. Shareholders wishing to formally communicate with the Board of Directors may send communications directly to Seagen Inc., Attention: Investor Relations, 21823 – 30th Drive SE, Bothell, Washington 98021, and communications that are relevant to the duties and responsibilities of the Board will be forwarded, as appropriate. If the communication regards a shareholder proposal to be considered at an annual meeting of shareholders, the methods and timing for submitting a shareholder proposal are covered under the heading “Frequently Asked Questions and Other Information—When are proposals and nominations due for the 2022 Annual Meeting?”

MAJORITY VOTING IN UNCONTESTED ELECTIONS

Our bylaws provide for a majority voting standard in uncontested director elections, instead of plurality voting. In uncontested elections, a director must be elected by a majority of the votes cast with respect to the election of such director (meaning the number of shares voted “for” such nominee’s election must exceed the number of votes cast “against” his or her election) at any meeting for the election of directors at which a quorum is present. However, in the event of a contested election of directors, directors shall be elected by the highest number of votes, or a plurality of votes, cast.

In addition, under our Corporate Governance Guidelines, any nominee for director who receives a greater number of votes “against” his or her election than votes “for” such election is required to submit an offer of resignation for consideration by the Governance Committee. In such case, the Governance Committee will then consider all of the relevant facts and circumstances and recommend to the full Board the action to be taken with respect to such offer of resignation.

BOARD CLASSIFICATION

The Board believes that there is no single approach to corporate governance that is appropriate for all companies and that the key consideration in determining whether to implement a particular governance practice is whether that practice promotes the interests of shareholders, taking into account the specific circumstances of Seagen. While the Board acknowledges that declassification proposals have received popular support, it has reviewed the rationale for its current classified structure and continues to believe that a classified board is the appropriate board structure for Seagen at this time and is in the best interest of our shareholders for the reasons set forth below:

 

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Long-Term Focus. The Board believes that a classified board encourages directors to look to the long-term best interest of Seagen and our shareholders by strengthening the independence of non-employee directors against the often short-term focus of certain investors and special interests.

 

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Continuity of Board Leadership. A classified board allows for a greater amount of stability and continuity, providing institutional perspective and knowledge both to management and other directors in a time of rapid growth and transformation for Seagen. In addition, the development and commercialization of pharmaceuticals is complex and requires significant expertise. By its very nature, a classified board ensures that at any given time there will be experienced directors serving on our Board who are fully immersed in and knowledgeable about our highly technical business, including our relationships with our current and potential strategic partners, as well as the competition, opportunities, risks and challenges that exist in the biotechnology and pharmaceutical industries. Each year the Governance Committee reviews the qualifications and performance of the directors prior to nominating them to stand for re-election. We believe the benefit of a classified board to Seagen and our shareholders comes not from continuity alone—but rather from the continuity of highly qualified, engaged and knowledgeable directors focused on long-term shareholder interests.

 

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Unsolicited Takeover Protection. A classified board can reduce vulnerability to potential abusive takeover tactics by encouraging persons seeking control of Seagen to negotiate with the Board and thereby better positioning the Board to negotiate effectively on behalf of all shareholders. Because less than a majority of directors stand for election at each annual meeting under a classified board structure, a hostile bidder could not simply replace a majority of the Board at a single annual meeting with directors aligned with the hostile bidder’s own interests,

 

		CORPORATE GOVERNANCE

 

thereby gaining control of Seagen without paying a fair market price to all shareholders. Rather, in the interests of fairness to shareholders as a whole, having a classified board encourages the hostile bidder to negotiate directly with the Board on a potential transaction.

In sum, Seagen has benefited from the independence and continuity of experienced leadership provided by our Board of Directors under the classified structure, and we believe these factors have been critical drivers of the significant growth in shareholder value that Seagen has generated over time.

SUCCESSION PLANNING

Succession planning is an important part of planning for the long-term success of our business. Under our Corporate Governance Guidelines, our Board is responsible for CEO succession planning, and they discuss CEO and executive officer performance and succession in executive session. In addition, our CEO and senior executives actively discuss future candidates for leadership positions at all levels within our organization. In fall 2020, we held an executive succession planning session at the Board level with the support of our Executive Vice President, Human Resources.

CORPORATE GOVERNANCE GUIDELINES

As a part of the Board’s commitment to building long-term shareholder value and maintaining sound corporate governance, the Board has adopted a set of Corporate Governance Guidelines, which guides the operation of the Board and its committees. Our Corporate Governance Guidelines cover, among other topics, Board composition, structure and functioning, including our director resignation policy, Board membership criteria, including but not limited to diversity considerations, director independence, Board self-evaluations, committees of the Board, Board access to management and independent advisers, stock ownership guidelines for members of the Board and our executive officers, and succession and leadership development. A copy of the Corporate Governance Guidelines can be viewed on our website at www.seagen.com.

STOCK OWNERSHIP GUIDELINES

Our Corporate Governance Guidelines include stock ownership guidelines for our directors and executive officers. For more information about these guidelines, please see “Director Compensation—Director Stock Ownership Guidelines” and “Compensation of Executive Officers—Compensation Discussion and Analysis—Stock Ownership Guidelines” below.

CODE OF CONDUCT AND BUSINESS ETHICS

The Board of Directors has adopted a Code of Conduct and Business Ethics, or the Code of Ethics, for all directors, officers and employees of Seagen Inc. A copy of the Code of Ethics can be viewed on our website at www.seagen.com. We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to, or waiver from, a provision of the Code of Ethics by posting such information on our website at the website address specified above.

WHISTLEBLOWER POLICY

Seagen has adopted a Whistleblower Policy applicable to its employees that provides for protection from retaliation or discrimination by Seagen due to reporting issues relating to concerns involving questionable accounting or auditing matters and compliance with applicable laws and regulations.

PROHIBITIONS ON HEDGING, PLEDGING AND SHORT-TERM SPECULATIVE TRANSACTIONS

Under the terms of our insider trading policy, no employees (including executive officers) of Seagen or its subsidiaries, members of our Board or consultants who know or have access to material information regarding Seagen that has not been fully disclosed to the public may engage in any hedging or monetization transactions relating to Seagen or its securities, including through the use of financial instruments such as prepaid variable forwards, equity swaps, collars and exchange funds, nor may any of these persons engage in short-term speculative transactions involving Seagen securities (or derivatives of Seagen securities), including short sales and the buying and selling of put or call options. In addition, none of these persons may hold Seagen securities in a margin account or otherwise pledge Seagen securities as collateral for a loan.

 

CORPORATE GOVERNANCE

 

CORPORATE RESPONSIBILITY

At Seagen, we are committed to developing transformative medicines for patients with cancer in a socially responsible and sustainable manner. We are dedicated to providing patients access to our medicines and education about their disease. We also believe that fostering a culture of inclusion with diverse teams and perspectives and operating with integrity are key to our success. We continue to support the community both locally and through nonprofits that are dedicated to patients and advancing research. Finally, as we grow, we are striving to limit our environmental impact and operate in an increasingly sustainable manner.

 

PATIENTS

EMPLOYEES & COMMUNITY

ENVIRONMENT

Providing patients with safe and effective medicines as well as supporting patient advocacy and education through philanthropic donations

Continuing to be an employer of choice by promoting an inclusive and rewarding workplace and being a good corporate citizen in the communities where we operate

Seeking to operate our business in a sustainable manner and aligning with suppliers that we believe share our vision

✓  Assisting patients with access to our medicines through coverage and reimbursement support, as well as financial support for eligible patients through our Seagen Secure program   ✓  Supporting patient advocacy organizations to help patients learn more about their disease states and find a community support group   ✓  Improving patients’ lives through scientific excellence by seeking to develop therapies for areas of significant unmet need   ✓  Working to ensure that our supply chain meets or exceeds good manufacturing practices (GMP) as well as U.S. Food & Drug Administration and European Medicines Agency standards

✓  Continuing to foster a diverse and inclusive workforce at all levels. See the “Diversity, Equity and Inclusion” section below.   ✓  Proactively seeking feedback from employees, including a 2020 survey where employee responses included the following:   •   97% are proud to work for Seagen   •   95% consider our culture and values as very important to their satisfaction   ✓  Expanding philanthropic and volunteer opportunities in support of nonprofits, including environmental and cancer groups, through our Employee Impact Committee     ✓  Educating our employees on adherence to our Code of Ethics and seeking partners who share our standards for suppliers

✓  Focusing on improving energy, water and waste management practices   ✓  Continuing to make available and promote to employees environmentally friendly options such as alternative commute options, bicycle racks, and electric vehicle charging stations   ✓  Implementing and maintaining a risk management process and internal controls designed to comply with our policy on Environmental, Health and Safety (EHS) management   ✓  Identifying and seeking to manage EHS risks and issues in line with principles of good governance and tiered accountability

Corporate social responsibility and sustainability are important to us and to our Board. We are continuing to direct resources towards these topics, and our management is undertaking a cross-functional effort to identify areas where we can enhance our disclosures on these topics during the upcoming year.

 

		CORPORATE GOVERNANCE

 

DIVERSITY, EQUITY AND INCLUSION

We believe that fostering diversity, equity and inclusion is a key element to discovering, developing, and bringing transformative therapies to patients with cancer. We strive to build a workforce representative of the people we serve and to build an inclusive culture where all voices are welcomed, heard, and respected.

As of the end of 2020, 57% of our global workforce and 37% of our leadership (at the executive director level and above) were women. In addition, as of the end of 2020, 33% of our U.S. workforce and 36% of our U.S. leadership (at the executive director level and above) were racially or ethnically diverse.

In 2020 and early 2021, our executive management took the following steps to advance our progress toward improving diversity, equity and inclusion, or DEI, at Seagen:

 

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Established DEI goals to promote our focus and serve as a baseline for measuring our progress over time

 

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Included progress towards our DEI goals in our 2021 corporate goals

 

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Engaged with the Board on the Company’s DEI initiatives

 

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Hired a Head of Diversity, Equity and Inclusion, a leader who will work closely with our executive leadership and Human Resources department to continue to evolve and execute our DEI strategy, including our goal to ensure a powerful, inclusive experience for all of our employees and to hire and retain the diverse talent needed to achieve our business strategy

 

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Established two new Employee Resource Networks, both with executive sponsorship, to advance our efforts to improve DEI at Seagen, Seagen Black Employees Supporting Talent (BEST) and Seagen PRIDE, and established a Diversity in Leadership Committee in our employee-led Leaders in Action organization

 

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Increased training programs to further promote diversity and inclusion at Seagen, including training on recognizing unconscious bias and supporting an inclusive environment

Please see “Corporate Governance—Criteria for Board Membership” and “—Director Nomination Process” above in this proxy statement for information on the diversity of our Board and the recent adoption by our Board of a policy to instruct third-party search firms to include women and candidates from underrepresented communities in the pool as part of director nominee searches.

 

DIRECTOR COMPENSATION

 

DIRECTOR COMPENSATION

The responsibility for reviewing director compensation and recommending changes to the Board is vested in the Compensation Committee per its charter. The Compensation Committee reviews our director compensation against the director compensation of our peer group companies annually, as described below under “—Processes and Procedures for Determining Director Compensation.”

CASH COMPENSATION

Our non-employee directors receive an annual cash retainer for service on the Board, plus reimbursement for out-of-pocket expenses incurred in connection with attendance at Board and Board committee meetings, as well as additional retainers for service as our lead independent director or service on committees of the Board. In January 2020, on the recommendation of the Compensation Committee based on a review of our peer group companies, the retainers for service on the Board and Board committees were revised as follows:

 

Service		Previous Annual Cash Compensation						New Annual Cash   Compensation
Non-Employee Director			$55,000					$	60,000
Lead Independent Director			$37,500						no change

 

		Chair				Member						Chair				Member
Audit Committee		$	25,000			$	12,000						no change				no change
Compensation Committee		$	20,000			$	10,000					$	22,000				no change
Governance Committee		$	15,000			$	6,500						no change				no change

Effective January 1 2021, on the recommendation of the Compensation Committee based on a review of our peer group companies, the annual retainer for service as the lead independent director was further revised from $37,500 to $40,000, and the annual retainers for non-chair members of the Audit and Governance Committees were further revised from $12,000 and $6,500, respectively, to $12,500 and $7,500, respectively. If a non-employee director has not served on the Board or a Board committee for the full year, the Board and any applicable Board committee retainers will be prorated for the portion of the year served.

EQUITY COMPENSATION

Our Board has established a policy of providing each new non-employee director of Seagen an initial grant of stock options and restricted stock units, or RSUs, under our Amended and Restated 2007 Equity Incentive Plan, or the 2007 Equity Plan. These initial awards are granted effective on the date on which a recipient first becomes a non-employee director of Seagen. In addition, effective on the date of each annual meeting of shareholders, each non-employee director receives an annual grant of stock options and RSUs under the 2007 Equity Plan if, on such date, he or she has served on the Board for at least six months prior to such date. The target values of the initial and annual grants to non-employee directors are as follows:

 

		Target Value of Option Award (1)				Target Value of RSU Award (2)				Total Target   Value of Award
Initial grant			$300,000				$300,000				$600,000
Annual grant			$200,000				$200,000				$400,000

(1)	The actual number of shares underlying each option grant is calculated based on an approximation of the target award value based on the average stock price during the 30 calendar days preceding the effective date of the grant and using the Black Scholes methodology for stock option valuation.

(2)	The actual number of shares underlying each RSU grant is calculated by dividing the target value of the RSU award by the average stock price during the 30 calendar days preceding the effective date of the grant.

 

		DIRECTOR COMPENSATION

 

In 2020, each of our non-employee directors who was serving at the time of our 2020 Annual Meeting of Shareholders received an annual option grant to purchase 3,171 shares of common stock and an annual RSU grant covering 1,335 shares of common stock, effective on the date of our 2020 Annual Meeting of Shareholders. In addition, effective August 17, 2020, in connection with his appointment to our Board, Dr. Love received an initial stock option grant to purchase 4,460 shares of common stock and an initial RSU grant covering 1,799 shares of common stock.

The exercise price of options granted to our directors is equal to the fair market value of our common stock on the Nasdaq Global Select Market on the effective date of grant. Options granted to non-employee directors under the 2007 Equity Plan have ten year terms and remain exercisable for up to three months following the grantee’s termination of service, unless such termination is a result of death or disability, in which case the options remain exercisable for up to a twelve-month period (or such lesser period as is determined by the Board).

The initial option grants vest as to 25% of the underlying shares on the first anniversary of the grant date and ratably thereafter on a monthly basis until such grant is fully vested on the fourth anniversary of the grant date, and the initial RSU grant vests as to 25% per year over a four year period on the anniversaries of the vesting commencement date, subject in both cases to continued service. The annual option and RSU awards made to each of our eligible directors in 2020 will vest on May 15, 2021. In addition, all non-employee directors would receive full acceleration of vesting of any outstanding options or RSU awards under the 2007 Equity Plan immediately prior to a change in control of Seagen.

DIRECTOR STOCK OWNERSHIP GUIDELINES

In order to align the interests of the directors with Seagen’s shareholders, our Corporate Governance Guidelines state that all non-employee directors should, not later than December 31st of the year during which the applicable director achieves his or her fifth anniversary as a non-employee director, own, directly or indirectly, a number of shares of Seagen common stock with a value not less than a multiple of the annual cash retainer paid by Seagen to such director for service on the Board, and thereafter such director should continue to own a number of shares with such value until he or she is no longer a director. In 2020, the minimum multiple was three times the annual cash retainer. The Compensation Committee used December 31, 2020 as the date to assess compliance with these director ownership guidelines. All of our non-employee directors serving as of such date were in compliance with these guidelines or had not yet reached the applicable deadline for compliance.

In February 2021, on the recommendation of the Compensation Committee following a review of the policies of our peer group companies, the Board increased the stock ownership guidelines for non-employee directors from three times to five times the annual cash retainer.

PROCESSES AND PROCEDURES FOR DETERMINING DIRECTOR COMPENSATION

In December 2020, Radford, part of the Rewards Solutions practice of Aon plc, or Radford, our Compensation Committee’s compensation consultant, conducted an analysis to compare our director compensation to the director compensation of the peer group of companies approved by our Compensation Committee, with input from senior management and Radford, in June 2020. For additional information on this peer group, please see “Compensation of Executive Officers—Compensation Discussion and Analysis—Compensation-Setting Process—Competitive Positioning.” Radford concluded that the annual retainer paid to our lead independent director and the annual retainers for service as a member of the Audit and Governance Committees were below the 50th percentile of our peer group medians. As a result of this analysis, in December 2020, our Compensation Committee recommended that these annual cash retainers be increased to approximate the 50^th percentile of cash compensation received by members of the boards of directors of our peer companies, and in February 2021, the Board approved this recommended change, resulting in the revised cash compensation effective January 1, 2021 described above.

In addition, the 2007 Equity Plan includes a limit on the amount of non-employee director compensation under the 2007 Equity Plan. Under the 2007 Equity Plan, the aggregate value of all compensation granted or paid to any individual solely for service as a non-employee director of the Board of Directors with respect to any calendar year may not exceed $1,000,000 in total value, calculating the value of any stock awards based on the grant date fair value of such awards for financial reporting purposes), or, with respect to the calendar year in which a non-employee director is first appointed or elected to the Board, $1,500,000. This limit does not serve as an increase in the annual amount of non-employee director compensation; rather, its purpose is limiting the amount of compensation the Board can approve for non-employee directors each year.

 

DIRECTOR COMPENSATION

 

DIRECTOR COMPENSATION TABLE

The following table sets forth all of the compensation awarded to or earned by each person who served as a non-employee director during 2020. Dr. Siegall, our only employee director, receives no compensation for Board service but is reimbursed for reasonable and customary travel expenses. Dr. Siegall’s compensation is described under “Compensation of Executive Officers” below.

 

Name		Fees Earned or Paid in Cash in 2020(1) $				Stock Awards(2) $				Option Awards(3) $				All Other Compensation $				Total  $
Felix J. Baker, Ph.D.(4)(13)			116,083				214,041				186,547				—				516,671
David W. Gryska(5)(13)			78,333				214,041				186,547				—				478,921
Marc E. Lippman, M.D.(6)(13)			61,375				214,041				186,547				—				461,963
Ted W. Love M.D.(7)(13)			26,190				291,114				293,238				—				610,542
John A. Orwin(8)(13)			71,893				214,041				186,547				—				472,481
Alpna H. Seth, Ph.D.(9)(13)			66,417				214,041				186,547				—				467,005
Nancy A. Simonian, M.D.(10)(13)			69,167				214,041				186,547				—				469,755
Daniel G. Welch(11)(13)			64,583				214,041				186,547				—				465,171
Srinivas Akkaraju, M.D., Ph.D.(12)(13)			32,917				214,041				186,547				10,000				443,505

 

(1)	Fees paid in cash for Board and Committee services reflect a portion paid at the current fee retainers, reflecting the changes made during January 2020 as discussed above, and a portion paid at the fee retainers paid prior to the change.

(2)	The amounts in this column represent the aggregate full grant date fair value of RSU awards granted during 2020 in accordance with FASB ASC Topic 718 with no estimate for future forfeitures, which value is based on the closing price of our common stock on the date of grant of May 15, 2020.

(3)

The amounts in this column represent the aggregate full grant date fair value of options granted during 2020 calculated in accordance with FASB ASC Topic 718 with no estimate for future forfeitures. For information regarding the assumptions used in calculating these amounts, see Note 17 of the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. The option awards amounts represent the grant date fair value of options granted on May 15, 2020 and with respect to Dr. Love, August 17, 2020.

(4)

Dr. Baker served as our lead independent director, chairman of our Compensation Committee and a member of our Governance Committee in 2020. The fees earned included a $55,417 retainer for Board service, a $34,375 retainer for service as the lead independent director, a $20,333 retainer for service as the chairman of our Compensation Committee, and a $5,958 retainer for service as a member of our Governance Committee.

(5)	Mr. Gryska served as chairman of our Audit Committee in 2020. The fees earned included a $55,417 retainer for Board service and a $22,916 retainer for service as chairman of our Audit Committee during 2020.

(6)	Dr. Lippman served as a member of our Governance Committee in 2020. The fees earned included a $55,417 retainer for Board service and a $5,958 retainer for service as a member of our Governance Committee.

(7)	Dr. Love served as a member of our Audit Committee from August through December 2020. The fees earned included a prorated retainer for Board service in the amount of $22,500 and a prorated retainer for service as a member of the Audit Committee in the amount of $3,690.

(8)

Mr. Orwin served as a member of our Audit Committee until August 2020, and our Compensation Committee during 2020. The fees earned included a $55,417 retainer for Board service, a $7,310 retainer for service as a member of the Audit Committee, and a $9,166 retainer for service as a member of the Compensation Committee.

(9)	Dr. Seth served as a member of our Audit Committee in 2020. The fees earned included a $55,417 retainer for Board service and $11,000 retainer for service as a member of the Audit Committee.

(10)	Dr. Simonian served as chair of our Governance Committee in 2020. The fees earned included a $55,417 retainer for Board service and a $13,750 retainer for service as chair of our Governance Committee.

(11)	Mr. Welch served as a member of our Compensation Committee in 2020. The fees earned included a $55,417 retainer for Board service and a $9,166 retainer for service as a member of our Compensation Committee.

(12)	The fees earned by Dr. Akkaraju consisted entirely of a retainer for Board service and all other compensation consists of $10,000 for consulting services. Dr. Akkaraju resigned from our Board in August 2020.

(13)	As of December 31, 2020, our non-employee directors listed in the table above held outstanding stock awards and options, as follows:

 

 

*

Dr. Akkaraju resigned from our Board in August 2020. In August 2020, we entered into a consulting agreement with Dr. Akkaraju upon his departure from our Board. Under the agreement, Dr. Akkaraju’s outstanding equity awards previously granted to him continued to vest during the term of the agreement, which ends on December 31, 2021. Please see “Certain Relationships and Related Party Transactions” for more information.