Business

Novartis chief drops $78m payout

BERLIN — Swiss drug maker Novartis AG has agreed with its outgoing chairman to scrap plans for a farewell noncompete deal that could have netted him up to $78 million.

The announcement followed criticism from some of the company’s shareholders and politicians.

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Daniel Vasella, 59, who is retiring this month, said Tuesday that he and the company agreed to forgo a ‘‘noncompete’’ payout that many people found ‘‘unreasonably high.’’

‘‘I have understood that many people in Switzerland find the amount of the compensation linked to the noncompete agreement unreasonably high, despite the fact I had announced my intention to make the net amount available for philanthropic activities,’’ Vasella said in a statement.

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News of the deal, under which Vasella would have earned up to $13 million a year for six years — almost the equivalent of his current basic salary — for not advising Novartis’s competitors over the coming years, emerged last week. It was met with a scathing response in Switzerland, where executive pay has become a sensitive issue recently.

Novartis has major operations in Cambridge, Mass.

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