Dive Brief:

• Zoetis appointed former GE Healthcare CFO Jay Saccaro in a newly-created dual role as its CFO and chief operating officer effective Aug. 17, the company announced in a Thursday securities filing and press release.
• With the appointment, Zoetis’ CFO Wetteny Joseph will transition to the role of special advisor to the Parsippany, New Jersey-based company, which develops medications and vaccinations for pets and livestock, effective Aug. 16. Joseph will remain with the company in a non-executive role until the earlier of Feb. 28, 2027 or a mutually agreed termination date, according to the filing with the Securities and Exchange Commission. His departure was not the result of any disagreement with the company.
• Saccaro “brings a unique combination of skills to this newly created leadership position,” Zoetis CEO Kristin Peck said in a statement included in the Thursday release. “Jay’s track record of designing financial frameworks that balance R&D investment with operational rigor and efficiency will be a significant asset as we sharpen our competitive edge and invest in our future growth platforms.” 

Dive Insight:

Saccaro’s appointment comes shortly after GE Healthcare announced he would be departing from his role as CFO after a three-year tenure, CFO Dive previously reported. The company’s Chief Accounting Officer and Controller George Newcomb will fill the role on an interim basis effective Aug. 14. 

Before GE Health, which he joined in 2023 when it spun off from the wider General Electric business, Saccaro served for nine years as CFO for Baxter International Healthcare, according to his LinkedIn profile.

As both CFO and COO, Saccaro will receive an annual base salary of $1 million, according to the SEC filing. He is also eligible for an annual target bonus opportunity of 100% of his base salary, and an annual target long-term incentive opportunity of $5 million, comprised of a mixture of restricted stock units, stock options, and performance stock units, according to the filing.

Saccaro will also receive a one-time “make-whole” award of RSUs valued at about $6.2 million, as well as a one-time make-whole cash award of about $1.2 million which will be subject to repayment if his employment is terminated “under certain circumstances” within his first year of employment, the filing states.  

Saccaro’s appointment also comes as Zoetis is seeking to invest in new growth opportunities as ongoing economic headwinds have changed “the nature of competition” for the business, Peck said Thursday during the company’s second quarter earnings call.

The company is “moving with urgency” to ensure it can maintain its leadership position in the market and drive growth, including by “evolving our leadership team to more closely align” with the execution of those initiatives, she said. 

The newly-created dual CFO and COO role will give Saccaro “broad oversight of all finance functions as well as global manufacturing and supply,” Peck said according to a transcript. “We are in an important moment that requires speed and agility and this change is all about enabling faster decision-making, greater connectivity across the supply chain, and accelerated turnarounds from strategic planning to execution. We are confident that we found the right leader with the right background to step into this new role.”

Results for Zoetis’s second quarter ended June 30 were below expectations: The business recorded a 5% slump in net income year-over-year, which hit $691 million for the period, according to its Thursday earnings release. Revenue for the quarter remained relatively flat YoY meanwhile, decreasing by 1% on an operational basis to $2.5 billion, according to its earnings release.

The results come as rising prices have led to consumer pet owners becoming “more selective” about how they spend, which is impacting both veterinary visit and purchasing patterns, Peck said Thursday. Additionally, newer entrants are moving into the market, and making use of higher discounting and other incentives to compete for patients, she said.

“These are broad pet care market dynamics and not unique to Zoetis, but they matter more for us because of where we lead,” Peck said. “Competitive intensity has increased and many of the categories facing the greatest pressure are categories Zoetis pioneered or helped establish as standards of care.”