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UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the

Securities Exchange Act of 1934

(Amendment (Amendment No.           )

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

☐Preliminary Proxy Statement
☐
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Preliminary Proxy Statement
​
☐
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
​
☒
Definitive Proxy Statement
​
☐
Definitive Additional Materials
​
☐
Soliciting Material under §240.14a-12
​
14a-6(e)(2))
☒Definitive Proxy Statement
☐Definitive Additional Materials
☐Soliciting Material under§240.14a-12

INCYTE CORPORATION

​
(Name of Registrant as Specified In Its Charter)

​
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box)all boxes that apply):

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No fee required.
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14a-6(i)(1)and 0-11.
(1)

Title of each class of securities to which transaction applies:

(2)

Aggregate number of securities to which transaction applies:

(3)

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

(4)

Proposed maximum aggregate value of transaction:

(5)

Total fee paid:

☐Fee paid previously with preliminary materials.
☐Check box if any part of the fee is offset as provided by Exchange ActRule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
(1)

Amount Previously Paid:

(2)

Form, Schedule or Registration Statement No.:

(3)

Filing Party:

(4)

Date Filed:

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Dear Fellow Stockholders,

This past

2021 was a remarkable year of execution for Incyte. We delivered strong revenue growth across our portfolio of products; launched several new products and indications, including our very first dermatology product; and advanced a number of important programs within our pipeline. Total product and royalty revenues grew 17% year over year to $2.9 billion, representing a five-year compounded annual growth rate of 24%. Since the beginning of 2021, we have received 5 regulatory approvals across the United States, Europe and Japan, illustrating the continued growth and diversification of our product portfolio.
One of the most notable events of 2021 was onethe launch of significant progressOpzelura™ (ruxolitinib) cream, which is not only our first dermatology product, but also the first topical JAK inhibitor approved to treat mild to moderate atopic dermatitis in the United States, where millions of patients are living with inadequately controlled disease. The uptake of Opzelura has been strong, driven by its unique profile and the clear unmet medical need. Ruxolitinib cream is also in development for vitiligo, a disease that causes loss of skin color in patches and that affects millions of patients worldwide. There are currently no approved therapies for repigmentation in vitiligo. Ruxolitinib cream achieved primary and all key secondary endpoints in the Phase 3 clinical trials for vitiligo and is now under regulatory review by the FDA and EMA for this indication. We are also pursuing Phase 3 studies for ruxolitinib cream in pediatric atopic dermatitis and chronic hand eczema, as well as other potential new indications, as we seek to build Incyte into a diversified, fast-growingexpand our dermatology franchise and global biopharmaceutical company.

Before highlighting our achievements in 2018,make it an important although disappointing, event wassource of growth for Incyte.

2021 also saw the resultprogress ofECHO-301, our Phase 3 trial together with Merckhematology and oncology portfolio, another component of Incyte’s future growth strategy. Several important programs within LIMBER (Leadership in MPNs BEyond Ruxolitinib) are ongoing, including two pivotal trials evaluating epacadostatparsaclisib in combination with pembrolizumab, Merck’s PD-1 antagonist,ruxolitinib and proof-of-concept trials with ruxolitinib in combination with our BET and ALK2 inhibitors. For each of these programs, we have the potential to develop a fixed-dose combination with our once-a-day (QD) formulation of ruxolitinib, which is currently in testing. Other important programs include our oral PD-L1 program, where we were the first to ever show clinical activity, and our adenosine program, where we have an opportunity for triplet therapy with A2A/A2B, CD73 and PD-1. We also initiated a Phase 3 study in warm autoimmune hemolytic anemia with parsaclisib based on positive Phase 2 results. Our pipeline is robust and well-balanced across stages of development and indications. We are looking forward to another exciting year ahead.
These achievements would not be possible without the hard work of our Incyte colleagues worldwide, who have worked with determination to bring innovative medicines to our patients.
We also made significant progress in our Global Responsibility efforts this year. In early 2021, we set public environmental goals for the first-line treatment of patients with advanced or metastatic melanoma. The expectations internally and within the medical community were high,first time, and we were disappointed thatalready have achieved one of those goals with our Green Globes certified U.S. Headquarters building in Wilmington, DE. We also transitioned our U.S. Headquarters’ electricity to 100% renewable sources, which represents an important step towards our goal of being operationally carbon neutral by 2025. To demonstrate our commitment to Global Responsibility, Environmental, Social and Governance (ESG) matters, we have added ESG goals to our annual incentive compensation plan for the combination did not show a benefitfirst time in progression-free survival (PFS) over pembrolizumab monotherapy. 2022.
We continue to learn as much as we canengage with and respond to feedback from the results, but this event reinforcedyou, our belief in the importance of having a robust portfolio of development projects. I’d likestockholders, to now move on to our 2018 achievements.

Sales of Jakafi® (ruxolitinib) continue to grow in both approved indications, myelofibrosis (MF)1 and polycythemia vera (PV)1. The stories of the patients we treat inspire us to do better, and we are committed to maintaining our leadership position in the treatment of patients with myeloproliferative neoplasms (MPNs). To that end, we are pursuing strategies that may improve patient outcomes in three ways: improved formulations of ruxolitinib, investigating ruxolitinib-based combination therapies, and discovering new targets beyond JAK inhibition.

With the ongoing U.S. Food and Drug Administration (FDA) review of ruxolitinib in steroid-refractory acute graft versus host disease (GVHD) and NDA submissions expected in the near-term for pemigatinib in patients with cholangiocarcinoma and itacitinib intreatment-naïve GVHD, we are confident in our potential to drivetop-line growth in the years to come.

Our discovery and development teams have created multiple opportunities for growth. In the coming year, we plan to focus on six key late-stage product candidates outlined below that, together, we believe may drive significant revenue growth in the near future.

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We also have two late-stage product candidates, baricitinib and capmatinib, which areout-licensed globally to Eli Lilly and Novartis, respectively. In June, we, along with Eli Lilly, announced the FDA approval of Olumiant® (baricitinib) for the treatment of certain patients with rheumatoid arthritis (RA)5. Lillycontinually improve. Your input is also developing baricitinib in multiple other autoimmune disorders and recently announced that the first two Phase 3 trials of baricitinib in atopic dermatitis achieved their primary endpoints. Lilly expects the last three of the five Phase 3 trials needed to seek approval in patients with moderate to severe atopic dermatitis to readout later in 2019. Data from capmatinib were presented innon-small cell lung cancer patients with MET exon 14 skipping mutations at the European Society for Medical Oncology 2018 Congress (ESMO), and Novartis has stated that it plans to submit an NDA in this indication this year.

It’s also important to note that should these goals come to fruition as we expect, five Incyte-invented molecules will have received FDA approval. We believe this remarkable achievement would be an excellent illustration of the quality of the work of our world class biologists and chemists.

On the financial front, total revenues reached $1.9B in 2018, an increase of over 20% versus 2017. Iclusig® (ponatinib)6 continues to grow, and royalties from Jakavi® (ruxolitinib)7 and Olumiant® (baricitinib) are contributing more to ourtop-line growth with each passing year. GAAP Net Income grew to $110M for 2018 as compared to a GAAP Net Loss of $313M in 2017.

We also had the opportunity to strengthen our executive management team with three new members in the last twelve months. First, we welcomed Maria Pasquale, J.D. as our General Counsel in April 2018. Ms. Pasquale has nearly 20 years of legal and compliance experience in the biopharmaceutical industry and most recently held the position of Global Chief Compliance Officer at Celgene Corporation. In December 2018, we were excited to welcome Dr. Dashyant Dhanak to the team as our Chief Scientific Officer. Dr. Dhanak joined us from Janssen Research & Development, where he most recently served as Global Head, Discovery Sciences. In February 2019, we welcomed Christiana Stamoulis as our new Chief Financial Officer. Ms. Stamoulis has over 20 years of experience in the biopharmaceutical industry, 15 of which was in investment banking and management consulting, and thereafter in executive positions at Vertex Pharmaceuticals and most recently serving as the President and CFO of Unum Therapeutics. We believe the collective experience of our new leadership team members will be a great asset for Incyte as we embark on our next stage of growth.

In October, we were proud to be recognized as the number two top employer in the biopharma industry byScience magazine. We believe that the collective experience and passion of our over 1,300 talented colleagues is foundationalvital to our success, and as our organization continuesmy fellow Directors and I would like to grow, we are committed to maintaining a culture that is driven by a passion for innovative science and where patients are at the forefront of everything we do.

Together, we strive to make a meaningful difference in the lives of those with cancer and other serious diseases, and in doing so, we aim to create long-term and sustainable value for you, our stockholders.

We thank you for your continued support and encouragement. We look forward to keeping you updatedreporting on what I expect to be another year of important milestones where we will develop and expand our progress.

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Sincerely,

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Hervé Hoppenot

Chairman of the Board of Directors

1.

Jakafi (ruxolitinib) is approved in intermediate or high-risk myelofibrosis (MF), including primary myelofibrosis, post-polycythemia vera myelofibrosis and post-essential thrombocythemia myelofibrosis, and in patients with polycythemia vera (PV) who have had an inadequate response to or are intolerant of hydroxyurea.

2.

Development of ruxolitinib in GVHD in collaboration with Novartis.

3.

Inflammation and Autoimmunity.

4.

All epidemiology data is for U.S., Europe and Japan except where noted for U.S. only; all incidence data for unresectable or metastatic disease, except prevalence for ruxolitinib cream.

5.

Olumiant (baricitinib) is approved for the treatment of mild to moderate rheumatoid arthritis in patients with inadequate response to standard-of-care therapies.

6.

Iclusig® is marketed by ARIAD Pharmaceuticals, Inc in the U.S. and by Incyte in the European Union and select countries. In the European Union, Iclusig is indicated for adult patients withCP-,AP-, orBP-CML who are resistant to dasatinib or nilotinib; who are intolerant to dasatinib or nilotinib and for whom subsequent treatment with imatinib is not clinically appropriate; or who have the T315I mutation, and adult patients with Ph+ ALL who are resistant to dasatinib; who are intolerant to dasatinib and for whom subsequent treatment with imatinib is not clinically appropriate; or who have the T315I mutation.

7.

Ex-U.S. rights to ruxolitinib license to Novartis; commercialized by Novartis as Jakavi.

Company Historypipeline, deliver new data in key clinical programs and continue driving uptake of Success

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Current Portfolio of Projects

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our existing and newly launched products and indications.

Solve On.
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Hervé Hoppenot
Chairman, President and Chief Executive Officer

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Incyte Corporation


1801 AugustineCut-Off


Wilmington, Delaware 19803

Notice of Annual Meeting of Stockholders

Friday, April 26, 2019

​
Wednesday, June 15, 2022
1:00 PM Eastern Daylight Time

1815 AugustineCut-Off, Wilmington, Delaware 19803

19803*

To the Stockholders of Incyte Corporation:

The Annual Meeting of Stockholders of Incyte Corporation, a Delaware corporation (the “Company”), will be held at the Company’s offices located at 1815 AugustineCut-Off, Wilmington, Delaware 19803, on Friday, April 26, 2019,Wednesday, June 15, 2022, at 1:00 PM Eastern Daylight Time, for the following purposes:

purposes specified below:

Purposes:

1.
Elect eight directors to serve until the 2023 Annual Meeting of Stockholders and thereafter until their successors are duly elected and qualified;
​
2.
Approve, on a non-binding, advisory basis, the compensation of the Company’s named executive officers;
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3.
Ratify the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for 2022; and
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4.
Transact such other business as may properly come before the Annual Meeting of Stockholders and any postponement or adjournment of the Annual Meeting.
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1.​

To elect eight directors to serve until the 2020 Annual Meeting of Stockholders and thereafter until their successors are duly elected and qualified;

2.

To approve, on anon-binding, advisory basis, the compensation of the Company’s named executive officers;

3.

To approve amendments to the Company’s Amended and Restated 2010 Stock Incentive Plan;

4.

To ratify the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for 2019;

5.

To vote on a stockholder proposal, if properly presented, described in more detail in the proxy statement; and

6.

To transact such other business as may properly come before the Annual Meeting of Stockholders and any postponement or adjournment of the Annual Meeting.

Record Date:

​March 12, 2019—​April 18, 2022—Stockholders of record as of the close of business on March 12, 2019April 18, 2022 are entitled to notice of and to vote at the Annual Meeting and any postponement or adjournment thereof.​

It is important that your shares be represented at this meeting. Even if you plan to attend the meeting, we hope that you will vote as soon as possible. Voting now will ensure your representation at the Annual Meeting regardless of whether you attend in person. You may vote over the internet, by telephone or by mailing the enclosed proxy card or voting instruction form. Please review the instructions on page 3pages 1 and 86 of the attached Proxy Statement and your proxy card or voting instruction form regarding each of these voting options.

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By Order of the Board of Directors
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​Maria E. Pasquale

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​Secretary​
April 29, 2022

March 21, 2019

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*
We intend to hold our Annual Meeting in person. However, we continue to monitor the coronavirus (COVID-19) situation and are sensitive to the public health and travel concerns our stockholders may have and the protocols that federal, state, and local governments may impose. If stockholder attendance is not permitted or we determine that it is not in the best interest of our employees, stockholders and community to permit stockholder attendance, we will announce alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting solely by means of remote communication. If we take this step, we will announce the decision to do so via a press release, and will post details on how to participate on our website and file additional proxy materials with the SEC. Please note that Incyte requires all visitors to provide proof of COVID-19 vaccination.
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TABLE OF CONTENTS​
Table of Contents

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​1​​
1
Proxy Statement Summary
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​22​​
Frequently Asked QuestionsPerformance Highlights
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6​9​​
Corporate Governance Highlights
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​12​​
Stockholder Engagement
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8​14​​
Executive Compensation Highlights
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​16​​
Global Responsibility
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​21​​
Proposal 1 Election of Directors
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14​​​​
26
​​Board Committees​​
16​​Corporate Governance
24​​
29
​​Compensation of Directors​​
27​​​​
Executive Compensation32
​​Corporate Governance​​
​4027​​
Compensation Discussion and Analysis
46Compensation Committee Report
47Executive Compensation Tables
61Equity Compensation Plan Information
62Report of the Audit Committee of the Board
63Proposal 2 Advisory Vote to Approve Executive Compensation​​
64​​​​
Proposal 3 Proposal to Amend the Amended and Restated 2010 Stock41
​​Executive Compensation​​
​​​​​​​Incentive Plan48​​Compensation Discussion and Analysis​​
76​​​​​​​62​​Compensation Committee Report​
​​​​​​​63​​Executive Compensation Tables​​
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76
​​CEO Pay Ratio​​
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77
​​Equity Compensation Plan Information​​
​78​​
Report of the Audit and Finance Committee of the Board
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​79​​
Proposal 43 Ratification of Independent Registered Public Accounting Firm
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78​80Proposal 5 Stockholder Proposal
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Security Ownership of Certain Beneficial Owners and Management
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86​82​​
Other Matters
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A-1​84Appendix A: Note RegardingForward-Looking Statements

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Frequently Asked Questions
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Appendix A: Note Regarding Forward-Looking Statements
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Proxy Statement 2019    2022|i
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Proxy Statement Summary

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Meeting Information

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Time and Date:​​1:00 PM EDT, April 26, 2019June 15, 2022​  LOGO​​
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Place:​​1815 Augustine Cut-Off*
Cut-Off
Wilmington, DE 19803​​
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Record Date:​March 12, 2019​April 18, 2022​​
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Admission:​​Please follow the instructions
contained in this Proxy Statement​​
​Statement
Mail Date:​This​The Proxy Statement and the
accompanying form of proxy
are beingAvailability Notice will be mailed to
stockholders on or about April 29, 2022​​
Voting Matters
PROPOSAL​​​​​
BOARD’S VOTING
RECOMMENDATION
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1​March 25, 2019

Voting Matters

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PROPOSALBOARD’S VOTING
RECOMMENDATION

1

Election of Directors��​

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Eacheach Nominee

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2​​

2

Advisory Vote to Approve Executive Compensation​

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3​​

3

Amend the Amended and Restated 2010 Stock Incentive

Plan

FOR

4

Ratification of Independent Registered Public Accounting

Firm

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5

Stockholder Proposal

AGAINST

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    Proxy Statement Summary    

Frequently Asked Questions

Will there be any other items of business on the agenda?

We do not expect any other items of business because the deadline for stockholder proposals and nominations has already passed. Nonetheless, in case there is an unforeseen need, the accompanying proxy gives discretionary authorityHow to the persons named on the proxy with respect to any other matters that might be brought before the meeting. Those persons intend to vote that proxy in accordance with their best judgment.

Vote

Who is entitled to vote?

Stockholders of record at the close of business on March 12, 2019, the Record Date, may vote at the Annual Meeting. Each stockholder is entitled to one vote for each share of our common stock held by such stockholder as of the Record Date.

How many shares must be present to hold the Annual Meeting?

The presence, in person or by proxy, of the holders of a majority of our outstanding common stock on the Record Date constitutes a quorum, which is required to hold and conduct business at the Annual Meeting. As of the close of business on the Record Date, there were 214,264,527 shares of our common stock outstanding. If you are a record holder and you submit your proxy, regardless of whether you abstain from voting on one or more matters, your shares will be counted as present at the Annual Meeting for purposes of determining a quorum. If your shares are held in street name, your shares are counted as present for purposes of determining a quorum if your broker, bank or other nominee submits a proxy covering your shares. Your broker, bank or other nominee is entitled to submit a proxy covering your shares as to certain “routine” matters, even if you have not instructed your broker, bank or other nominee on how to vote on those matters. Please see “How are votes counted?” below. If a quorum is not present, we expect that the Annual Meeting will be adjourned until we obtain a quorum.

What is the difference between holding shares as a stockholder of record and as a beneficial owner?

Stockholder of Record.    If your shares are registered directly in your name with our transfer agent, Computershare, you are considered, with respect to those shares, the “stockholder of record.” This Proxy Statement, our Annual Report and the proxy card have been sent directly to you by Incyte.

Beneficial Owner.    If your shares are held in a stock brokerage account or by a broker, bank or other nominee, you are considered the “beneficial owner” of shares held in street name. This Proxy Statement and our Annual Report have been forwarded to you by your broker, bank or other nominee who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker, bank or other nominee how to vote your shares by using the voting instruction form provided by your broker, bank or other nominee.

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    Proxy Statement Summary    

How do I vote?

You may vote using any of the following methods:

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​INTERNET​​TELEPHONE​​MAIL​​IN PERSON​

By Mail

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Stockholders of record may vote
online at
www.envisionreports.com/INCY
​​

By TelephoneStockholders of record

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may call toll-free
1-800-652—VOTE (8683)
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By Internet

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In Person at the Annual Meeting

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Mail – Follow the instructions in your
proxy materials.		​​Telephone – Stockholders of record may calltoll-free1-800-652–VOTE (8683)By Internet – Stockholders of record may vote online atwww.envisionreports.com/INCYIn Person at the Annual Meeting – You may obtain directions to the Annual Meeting by contacting our Company’s Investor Relations Department at(302) 498-6700.
Most stockholders who hold shares beneficially in street name may provide voting instructions to their brokers, banks or other nominees by telephone by calling the number specified on the voting instruction form provided by their brokers, banks or other nominees. The telephone voting facilities will close at 11:59pm, Eastern Daylight Time, the day before the meeting date.Most stockholders who hold shares beneficially in street name may provide voting instructions to their brokers, banks or other nominees by accessing the website specified on the voting instruction form provided by their brokers, banks or other nominees. The internet voting facilities will close at 11:59pm, Eastern Daylight Time, the day before the meeting date.Even if you plan to attend the Annual Meeting, we recommend that you also submit your proxy or voting instructions or vote by telephone or the internet so that your vote will be counted if you later decide not to attend the meeting​

​
Can I change my vote or revoke my proxy?*

You may change your vote or revoke your proxy at any time prior

We intend to hold our Annual Meeting in person. However, we continue to monitor the coronavirus (COVID-19) situation and are sensitive to the votepublic health and travel concerns our stockholders may have and the protocols that federal, state, and local governments may impose. If stockholder attendance is not permitted or we determine that it is not in the best interest of our employees, stockholders and community to permit stockholder attendance, we will announce alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting solely by means of remote communication. If we take this step, we will announce the decision to do so via a press release, and will post details on how to participate on our website and file additional proxy materials with the SEC. Please note that Incyte requires all visitors to provide proof of COVID-19 vaccination.
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Proxy Statement 2022|1
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Performance Highlights
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2021 Financial Performance
2021 was another year of strong performance for Incyte. Product and royalty revenues grew 17% year-over-year to $2.9 billion, driven by growth across all products commercialized by Incyte as well as Incyte products commercialized by our partners. During the year, we achieved 5 regulatory approvals across the U.S., Europe and Japan. These launches are currently underway and are expected to contribute more meaningfully to revenue going forward.
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Revenues of Jakafi® (ruxolitinib), our largest product by net sales, grew 10% to reach $2.1 billion for the year, with new patient starts driving performance across our approved indications in myelofibrosis, polycythemia vera and graft-versus-host disease (GVHD). In the fourth quarter, Jakafi received approval of its fourth indication for the treatment of patients with steroid-refractory chronic GVHD.
Within our hematology and oncology franchise, we further expanded our commercial portfolio with several new approvals, including Pemazyre® (pemigatinib) in cholangiocarcinoma (CCA) in Europe and Japan and Minjuvi® (tafasitamab) in relapsed or refractory diffuse large B-cell lymphoma (DLBCL) in Europe, establishing both as global brands following their U.S. launches in 2020.
An important achievement in 2021 was the approval and launch in October of Opzelura™ (ruxolitinib) cream for atopic dermatitis. Opzelura is a significant future growth driver for Incyte and a cornerstone program for our newly established dermatology franchise. Opzelura is a potent and selective inhibitor of JAK1 and JAK2, designed specifically for topical application. Its unique profile, which positions the product in between other topical therapies and systemic drugs, addresses a significant unmet need in a market where there are millions of patients living with inadequately controlled mild to moderate atopic dermatitis. In the first twelve weeks of commercialization of Opzelura, over 19,000 new patients were treated with Opzelura and we continue to see strong uptake week over week. In addition to atopic dermatitis, we have another substantial opportunity for ruxolitinib cream in vitiligo, a disease that causes loss of skin color in patches and which affects over 1.5 million people in the U.S. Currently, there are no approved therapies for repigmentation.
In addition to our product revenues, we receive royalties on Jakavi® (ruxolitinib) and Tabrecta® (capmatinib), commercialized by Novartis, and on Olumiant® (baricitinib), commercialized by Eli Lilly and Company. Jakavi is indicated for the treatment of patients with myelofibrosis and polycythemia vera and in March 2022, received a positive CHMP opinion for acute and chronic graft-versus-host disease. Tabrecta is approved in the U.S. and Japan for the treatment of patients with metastatic non-small cell lung cancer whose tumors have a mutation that leads to METex14 and in April 2022, received a positive CHMP opinion for the same indication. Olumiant is approved for rheumatoid arthritis (in the U.S., Europe and Japan) and atopic dermatitis (in Europe and Japan), and last year,
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TABLE OF CONTENTS
​Performance Highlights​
was authorized for use under an Emergency Use Authorization for the treatment of COVID-19. Total royalties grew 45% in 2021 to reach $569 million
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(1)
Monjuvi revenues recognized by MorphoSys and included in our collaboration loss sharing line item on our consolidated statement of operations for the year ended December 31, 2021.
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(2)
Totals may not add due to rounding.
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Proxy Statement 2022|3
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TABLE OF CONTENTS
​Performance Highlights​
2021 and YTD Regulatory and Clinical Achievements
Throughout 2021 and year-to-date, we achieved numerous important milestones. These are summarized in the graphic below and described in more detail thereafter.
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AD = atopic dermatitis; GVHD = graft-versus-host disease; DLBCL = diffuse large B-cell lymphoma; CCA = cholangiocarcinoma; BTC = biliary tract carcinoma; AAD = American Academy of Dermatology; MAA = Marketing Authorization Application; EMA = European Medicines Agency; NSCLC = non-small cell lung cancer.
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(1)
Development of axatilimab in collaboration with Syndax Pharmaceuticals
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Myeloproliferative Neoplasms (MPNs) and Graft-Versus-Host Disease (GVHD)
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Jakafi received its fourth approval in steroid-refractory chronic GVHD in September 2021. There are approximately 14,000 patients living with chronic GVHD in the U.S., of which over half require therapy beyond systemic corticosteroids.
Our Leadership In MPNs Beyond Ruxolitinib (LIMBER) program focuses on developing new therapies to improve and expand upon available therapeutic options for patients living with MPNs. Parsaclisib (PI3Kδ) plus ruxolitinib is being evaluated in pivotal trials (1L and inadequate responders), and INCB57643 (BET) and INCB00928 (ALK2) combination trials with ruxolitinib are in proof-of-concept. Once-a-day (QD) ruxolitinib is currently in testing and is expected to be submitted to the FDA for approval in the first half of this year.
In 2021, we entered into a global collaboration with Syndax Pharmaceuticals to clinically develop and commercialize axatilimab, an anti-CSF-1R monoclonal antibody, as a therapy for patients with chronic GVHD as well as in
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TABLE OF CONTENTS
​Performance Highlights​
additional immune-mediated diseases where CSF-1R-dependent monocytes and macrophages are believed to contribute to organ fibrosis. We expect to expand development of axatilimab in cGVHD with additional monotherapy and combination trials planned later this year.
Other Hematology and Oncology
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In 2020, Monjuvi® was approved under accelerated approval by the U.S. FDA based on data, including overall response rate, from the Phase 2 L-MIND study, a single-arm trial of Monjuvi in combination with lenalidomide as a treatment for adult patients with r/r DLBCL. Monjuvi’s launch is ongoing in the U.S. and uptake continues to increase in the second-line DLBCL setting, with continued penetration into new accounts.
In 2021, we received the approval in Europe of Minjuvi® as a treatment for patients with relapsed or refractory DLBCL and we are working to secure reimbursement on a country by country basis.
Updated 3-year L-MIND results were recently presented and demonstrated the potential for long-term disease control and durable responses in patients treated with tafasitamab in combination with lenalidomide followed by tafasitamab monotherapy in patients with r/r DLBCL.
Several trials evaluating tafasitamab in additional indications are currently ongoing, including a Phase 3 trial in first line DLBCL evaluating tafasitamab plus lenalidomide and R-CHOP versus R-CHOP and a Phase 3 trial evaluating tafasitamab plus lenalidomide and rituximab (R-squared) versus R-squared in patients with relapsed or refractory follicular or marginal zone lymphoma.
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Pemazyre is the first targeted therapy approved in the U.S for second-line cholangiocarcinoma and is the market leader. It is the first product to be commercialized by Incyte in multiple geographies following regulatory approvals in Europe and Japan in 2021.
Pemigatinib is currently being evaluated in a pivotal study in first-line cholangiocarcinoma. Additionally, based on findings from our solid tumor-agnostic trial (FIGHT-207) evaluating pemigatinib in patients with driver-alterations of FGF/FGFR, we intend to initiate Phase II studies in glioblastoma (GBM) and non-small cell lung cancer (NSCLC).
Other development highlights within hematology and oncology include:
•
We initiated a Phase 3 study of parsaclisib in warm autoimmune hemolytic anemia (AIHA) based on positive Phase 2 results. There are an estimated 1 in 8,000 people living with warm AIHA in the United States, of which the treatable population is approximately 30%. There are no approved therapies for patients living with this disease.
​
•
Our oral PD-L1 program was the first to ever demonstrate clinical activity.
​
•
Retifanlimab (PD-1) is currently being evaluated in a Phase 3 trial (POD1UM-303) as a treatment for previously treated patients with advanced squamous cell carcinoma of the anal canal (SCAC) who have
​
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TABLE OF CONTENTS
​Performance Highlights​
progressed following standard platinum-based chemotherapy. In addition, retifanlimab is being evaluated as a first line therapy in combination with platinum-based chemotherapy as a treatment for patients with NSCLC.
Inflammation and AutoImmunity (IAI) / Dermatology
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Opzelura™ (ruxolitinib) cream was launched on October 11, 2021 for mild to moderate atopic dermatitis (AD) and is pending regulatory approval for vitiligo.
We presented positive Phase 3 TRuE-V 24-week results of ruxolitinib cream treatment in patients with vitiligo at the European Academy of Dermatology and Venereology (EADV) last year. Primary and all key secondary endpoints were met and ruxolitinib cream demonstrated significant improvements in facial and total body repigmentation in vitiligo patients. At the 2022 American Academy of Dermatology (AAD) Annual Meeting, we presented new 52-week results from the pivotal program, which demonstrated that a longer duration of therapy with ruxolitinib cream was associated with greater repigmentation. A supplemental new drug application (sNDA) and a marketing authorization application (MAA) for ruxolitinib cream as a treatment for vitiligo are under review at the U.S. FDA and the European Medicines Agency (EMA), respectively. If approved, ruxolitinib cream would become the first product approved for repigmentation in vitiligo and would be a new therapeutic option for the millions of patients living with the disease today.
Further, as we work to maximize the opportunity for the dermatology franchise, we have established a broad clinical development program within dermatology that includes multiple new indications for ruxolitinib cream, as well as new products. Ruxolitinib cream is being evaluated in pediatric atopic dermatitis and in chronic hand eczema, where we are initiating two Phase 3 studies. We are also assessing INCB54707, our JAK1 specific inhibitor, in Phase 2 studies for hidradenitis suppurativa, prurigo nodularis and vitiligo. There is significant potential with each of these indications where there are limited treatment options, or in some cases, no FDA-approved therapies.
Partnered Programs (Incyte is eligible for royalties and milestone payments)
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We participate in multiple collaborative partnerships in which we are eligible for milestone payments and royalties on certain Incyte discovered products that we licensed to third parties. Currently, our key commercialized products include Jakavi® (ruxolitinib) and Tabrecta® (capmatinib), which are licensed to Novartis, and Olumiant® (baricitinib), which is licensed to Lilly.
Ruxolitinib is under review both at the EMA and the Pharmaceuticals and Medical Devices Agency (PMDA) as a treatment for steroid-refractory acute and chronic GVHD in Europe and Japan, respectively. In March 2022, the EMA’s Committee for Medicinal Products for Human Use (CHMP) issued a positive opinion recommending approval of ruxolitinib for the treatment of patients aged 12 and older with steroid-refractory acute graft-versus-host disease or chronic graft-versus-host disease. Capmatinib is under review at the EMA as a treatment for certain patients with NSCLC and in April 2022, the CHMP issued a positive opinion recommending approval of capmatinib for the treatment of adults with metastatic non-small cell lung cancer whose tumors have a mutation that leads to METex14.
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During 2021, Lilly announced positive results from two pivotal Phase 3 trials (BRAVE-AA1 and BRAVE-AA2) which found once-daily OLUMIANT® (baricitinib) 4-mg was superior to placebo in achieving significant scalp hair regrowth as early as 24 weeks in adults with severe alopecia areata (AA) as defined by ≥50% scalp hair loss at baseline. Lilly has submitted an sNDA, MAA and J-NDA for baricitinib as a treatment for AA in the U.S., Europe and Japan, respectively. There are no approved systemic therapies for AA.
Clinical Development Pipeline
Our pipeline is broad and diverse spanning across multiple mechanisms of action and diseases, all with the same goal of developing therapies that help to address unmet needs of patients and to ultimately be able to make a meaningful difference in the lives of patients and their caregivers. The chart below summarizes our clinical stage programs.
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​Performance Highlights​
Discovery Capabilities
Our approach to drug discovery, driven by our core competencies in medicinal chemistry and cellular and translational biology, has enabled us to bring forth numerous drug candidates into clinical development and through regulatory approval. We have established a focused set of drug discovery capabilities in-house, including target validation, high-throughput screening, medicinal chemistry, computational chemistry, pharmacological and translational sciences, ADME (absorption, distribution, metabolism and excretion) and toxicology assessment. We augment these capabilities through a network of collaborations with academic partners and contract research organizations with relevant expertise. In addition to our established small molecules expertise, we have expanded our drug discovery capabilities to include monoclonal antibody discovery in-house and access to bi-specific antibody discovery capabilities.
Our discovery process is target- and pathway-centric and leverages cross-program knowledge to identify and prosecute novel points of synergy, and our areas of focus are primarily in oncology and inflammation and autoimmunity.
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Corporate Governance Highlights
​
Our Board of Directors
​​​​​​​​​​​​​​​Committee Membership​
Name and Primary Occupation​​
Director
Since
​​Age​​Independent​​
Other
Outside
Public
Boards
​​Compensation​​
Audit
and
Finance
​​
Nominating
and
Corporate
Governance
​​
Science and
Technology
​
Hervé Hoppenot—Chairman of the Board
President and Chief Executive Officer
Incyte Corporation
​​2014​​62​​​​​1​​​​​​​​​​​​​
Julian C. Baker—Lead Independent Director
Managing Partner
Baker Brothers Investments
​​2001​​55​​✓​​2​​
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​​​​​
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​​​​
Jean-Jacques Bienaimé
Chief Executive Officer
BioMarin Pharmaceutical Inc.
​​2015​​68​​
✓​
​​1​​
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​​​​​
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​​​​
Otis W. Brawley, M.D.
Bloomberg Distinguished Professor of Oncology and Epidemiology
Johns Hopkins University
​​2021​​62​​✓​​3​​​​​​​​​​​
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​
Paul J. Clancy
Former Executive Vice President
and Chief Financial Officer
Alexion Pharmaceuticals, Inc.
​​2015​​60​​✓​​3​​
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​​​​​​​
Wendy L. Dixon, Ph.D.1
Former Chief Marketing Officer and
President, Global Marketing
Bristol-Myers Squibb Company
​​2010​​66​​
✓​
​​2​​​​​
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​​​​​​​
Jacqualyn A. Fouse, Ph.D.
Chief Executive Officer
Agios Pharmaceuticals, Inc.
​​2017​​60​​
✓​
​​1​​​​​
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​​
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​​​​
Edmund P. Harrigan, M.D.
Former Senior Vice President of Worldwide Safety and Regulatory
Pfizer Inc.
​​2019​​69​​
✓​
​​2​​​​​​​​​​​
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​
Katherine A. High, M.D.
President, Therapeutics
Asklepios Biopharmaceutical, Inc.
​​2020​​70​​
✓​
​​1​​​​​​​​​​​
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​
​
[MISSING IMAGE: tm2025328d39-icon_chairpn.jpg]
​​Committee Chair​​
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​​Financial Expert​​
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​​Member​
​
1.
Dr. Wendy L. Dixon is retiring from the Board as of the Annual Meeting. If you submitted your proxy by mail, you must file
​
Board Skills and Experience
Our Board is made up of a diverse group of individuals with various pertinent areas of expertise. Continuous refreshment has led to a complementary mix of new, mid-term and seasoned directors. We believe this group of directors collectively has the Secretaryskills and experience to support Incyte in the achievement of our Company a written noticelong-term goals.
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TABLE OF CONTENTS
​Corporate Governance Highlights​
Matrix of revocation or deliver, prior to the vote at the Annual Meeting, a valid, later dated proxy. If you submitted your proxy by telephone or the internet, you may change your vote or revoke your proxy with a later telephone or internet proxy, as the case may be. Attendance at the Annual Meeting will not have the effect of revoking a proxy unless you give written notice of revocation to the Secretary before the proxy is exercised or you vote by written ballot at the Annual Meeting. For shares you hold beneficially in street name, you may change your vote or revoke your proxy by submitting new voting instructions to or informing your broker, bank or other nominee in accordance that entity’s procedures for changing or revoking your voting instructions.

Board Nominees

Expertise​​Hoppenot​​Baker​​Bienaimé​​Brawley​​Clancy​​Fouse​​Harrigan​​High​
Biopharma Industry​​✓​​✓​​✓​​✓​​✓​​✓​​✓​​✓​
Operational Leadership​​✓​​​​​✓​​​​​✓​​✓​​✓​​✓​
International​​✓​​​​​✓​​​​​✓​​✓​​✓​​​​
Drug Discovery, Development & Regulatory​​✓​​​​​✓​​✓​​​​​​​​✓​​✓​
Commercial​​✓​​​​​✓​​​​​​​​✓​​​​​​​
Financial​​✓​​✓​​✓​​​​​✓​​✓​​​​​​​
Additional Information​​​​​​​​​​​​​​​​​​​​​​​​​
PhD/MD​​​​​​​​​​​✓​​​​​✓​​✓​​✓​
Attendance​​100%​​100%​​93%​​100%​​100%​​100%​​88%​​100%​
Independence​​​​​✓​​✓​​✓​​✓​​✓​​✓​​✓​
How are votes counted?

In the election of directors, you may vote “FOR,” “AGAINST” or “ABSTAIN” for each nominee. For each of Proposals 2, 3, 4Board Evaluation and 5, you may vote “FOR,” “AGAINST” or “ABSTAIN.”

If you provide specific instructions, your shares will be voted as you instruct. If you sign your proxy card or voting instruction form with no further instructions, your shares will be voted in accordance with the recommendations ofRefreshment

At least annually, the Board (“FOR” allassesses its composition, taking into consideration: the knowledge, experience and diverse perspectives of the nomineesits directors; each individual director’s performance and contributions to the Board and its committees; the other time commitments of Directors, “FOR”directors; and other factors the approvalBoard deems appropriate, such as independence, absence of the compensation of our named executive officers, “FOR” the approval of the amendments to our Amendedconflicts and Restated 2010 Stock Incentive Plan, “FOR” the ratification of the independent registered public accounting firm, “AGAINST” the stockholder proposal, if properly presented, and in the discretion of the proxy holders on any other matters that may properly come before the meeting).

If you hold shares beneficially in street name and do not provide your broker, bank or other nominee with voting instructions, your shares may constitute “brokernon-votes.” Generally, brokernon-votes occur on a matter when a broker, bank or other nominee is not permitted to vote on that matter without instructions from the beneficial owner and instructions are not given. If you hold shares beneficially in

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    Proxy Statement Summary    

street name and do not vote your shares, your broker, bank or other nominee can vote your shares at its discretion only on Proposal 4, the ratification of the independent registered public accounting firm. In tabulating the voting result for any particular proposal, shares that constitute brokernon-votes are not considered entitled to vote on that proposal. Thus, brokernon-votes will not affect the outcomelack of any matter being voted on at the Annual Meeting, other than Proposal 4, assuming that a quorum is obtained.

What vote is required to approve each item?

We have a majority voting standard for the election ofreputational risks. The Board weighs these factors with Incyte’s priorities and needs. Our directors in an uncontested election, which is generally defined as an election in which the number of nominees does not exceed the number ofserve one-year terms and all continuing directors to be elected at the meeting. Cumulative voting is not permitted, which means that each stockholder may vote no more than the number of shares he or she owns for a single director candidate. Under our majority voting standard, in uncontested elections of directors, such as this election, each director must be elected by the affirmative vote of a majority of the votes cast by the shares present in person or represented by proxy. A “majority of the votes cast” means that the number of votes cast “FOR” a director nominee exceeds the number of votes cast “AGAINST” the nominee. If a director nominee is an incumbent director and does not receive a majority of the votes cast in an uncontested election, that director will continue to serve on the Board as a “holdover” director, but will beare subject to our director resignation policy. Additional information concerningstockholders’ votes every year.

As our director resignation policy is set forth under the heading “Corporate Governance—Majority Voting Policy.”

The table below describes the proposals to be considered at the Annual Meeting and the vote required for each proposal:

ProposalVote RequiredEffect of
Abstentions(1)

Broker

Discretionary
Voting Allowed?(2)

1 Election of DirectorsA nominee for director will be elected if the votes cast “FOR” such nominee exceed the votes cast “AGAINST” such nominee.

No effect

Not considered votes cast on this proposal

No

Brokers without voting instructions will not be able to vote on this proposal

2 Advisory Vote to Approve Executive CompensationNon-binding, advisory proposal. We will consider the matter approved if it receives the affirmative vote of a majority of the shares of common stock present at the Annual Meeting in person or by proxy and entitled to vote.

Counted as vote

Same effect as votes against

No

Brokers without voting instructions will not be able to vote on this proposal

3 Approval of Amendments to the Amended and Restated 2010 Stock Incentive PlanThe affirmative “FOR” vote of a majority of the shares present at the Annual Meeting in person or by proxy and entitled to vote.

Counted as vote

Same effect as votes against

No

Brokers without voting instructions will not be able to vote on this proposal

4 Ratification of the Appointment of Ernst & Young LLPThe affirmative “FOR” vote of a majority of the shares present at the Annual Meeting in person or by proxy and entitled to vote.

Counted as vote

Same effect as votes against

Yes

Brokers without voting instructions will have discretionary authority to vote

5 Stockholder ProposalNon-binding, advisory proposal. We will consider the matter approved if it receives the affirmative vote of a majority of the shares of common stock present at the Annual Meeting in person or by proxy and entitled to vote.

Counted as vote

Same effect as votes against

No

Brokers without voting instructions will not be able to vote on this proposal

(1)

As noted above, abstentions will be counted as present for purposes of establishing a quorum at the Annual Meeting.

(2)

Only relevant if you are the beneficial owner of shares held in street name. If you are a stockholder of record and you do not cast your vote, no votes will be cast on your behalf on any of the items of business at the Annual Meeting.

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    Proxy Statement Summary    

If any other matter is properly brought before the Annual Meeting, such matter also will be determined by the affirmative vote of a majority of the shares of common stock present at the Annual Meeting in person or by proxy and entitled to vote at the Annual Meeting.

What is “householding” and how does it affect me?

We have adopted a process for mailing our Annual Report and this Proxy Statement called “householding,” whichBoard has been approved by the Securities and Exchange Commission. Householding means that stockholders who share the same last name and address will receive only one copy of our Annual Report and this Proxy Statement, unless we receive contrary instructions from any stockholder at that address. We will continue to mail a proxy card to each stockholder of record.

If you prefer to receive multiple copies of our Annual Report and this Proxy Statement at the same address, additional copies will be provided to you upon request. If you are a stockholder of record, you may contact us by writing to Investor Relations Department, Incyte Corporation, 1801 AugustineCut-Off, Wilmington, Delaware 19803 or by calling(302) 498-6700 and asking for Investor Relations. Eligible stockholders of record receiving multiple copies of our Annual Report and this Proxy Statement can request householding by contacting usdone in the same manner. We have undertaken householding to reduce printing costs and postage fees, and we encourage you to participate.

If you arepast, when it sees a beneficial owner, you may request additional copies of our Annual Report and this Proxy Statementcurrent or you may request householding by notifying your broker, bank or other nominee.

How are proxies solicited?

Our employees, officers and directors may solicit proxies. We will pay the cost of printing and mailing proxy materials, and will reimburse brokerage houses and other custodians, nominees and fiduciariesfuture need, it undertakes a thorough search for their reasonableout-of-pocket expenses for forwarding proxy and solicitation material to the owners of our common stock.new directors. In addition,recent years, we have engaged D.F. King & Co., Inc. to assist usadded three new independent directors, with an emphasis on strengthening the Board’s expertise in soliciting proxies for a feethe areas of $12,500, plusout-of-pocket expenses.

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Stockholder Engagement

Throughout the year, we maintaindrug discovery, clinical development and regulatory, given Incyte’s extensive development portfolio across hematology/oncology and dermatology. Dr. Brawley, an ongoing stockholder outreach program to garner feedbackoncologist, joined our Board in September 2021 and brings significant scientific, medical and public health leadership experience. His expertise within hematology and oncology will provide valuable insights into our drug discovery and development efforts, as well as into healthcare delivery.

​​​Relevant Experience​
Director​​
Executive/
Industry
​​Drug Discovery​​
Clinical
Development
​​Regulatory​​
Business
Development
​
Otis W. Brawley, M.D.​​✓​​​​​✓​​✓​​​​
Edmund P. Harrigan, M.D.​​✓​​​​​✓​​✓​​✓​
Katherine A. High, M.D.​​✓​​✓​​✓​​✓​​​​
Board Diversity
Our Board consists of a diverse group of highly skilled and experienced leaders who bring both different perspectives and areas of expertise, contributing to answer any questions stockholders may have both during and outsidethe overall effectiveness of proxy season. Our goal is to ensure that our corporate governance practices, our compensation program and our stockholder communications align with best practices.

Each year, we proactively reach out to our stockholders to determine how our corporate governance, compensation practices and stockholder communications might improve. In 2018 and 2017, we contacted stockholders representing over 80% and 60%the Board.Two of our shares outstanding, respectively. Our CEO, our Lead Independent Director and the resteight Board nominees are women, representing 25% of our Board – alongof Directors. This is in line with the rest2021 average among S&P 500 constituents, in which 29% of all Board seats are currently taken by women. Two (25%) of our executive management – regularly discuss the learnings from these thoroughdirectors were born in Europe, one self-identifies as Black/African American and informative conversations. As a result of this ongoing stockholder engagement over the last four years, we have implemented several significant enhancements in our corporate governance and compensation policies and in our stockholder communication practices, including most recently in 2019. We believe these changes help us to further align the Company’s interests with the best interests of our stockholders.

one self-identifies as LGBTQ+.
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Stockholder Engagement
​
​
Each year, we conduct stockholder outreach to gather direct feedback on our corporate governance, compensation practices and environmental, social and governance (ESG) practices. Since 2018, we have contacted stockholders who represent the top 80% of our shares outstanding.
As a result of our annual stockholder engagement, we have implemented several significant enhancements in our corporate governance, compensation policies, ESG activities and stockholder communication practices. The following changes were made in response to feedback received:
​​
ANNUAL OUTREACH TO
STOCKHOLDERS:
80%​
OF SHARES OUTSTANDING
​
​​​Action​​Year of Implementation​
What We Heard​​What We Did​Governance​​​​

LOGO

✓		​

2018Say-on-pay stockholder discussions made clear that ad hoc retention​

Adopted a proxy access bylaw​​2021​
✓​​Adopted equity grantsownership guidelines​​2016, amended 2021​
✓​​Adopted a director overboarding policy​​2020​
​​​Compensation​​​​
✓​​Adjusted the executive compensation pay mix to include higher percentages of performance shares​​Performance Shares added in 2018; increased % of performance shares in 2020 and 2022​
✓​​Established a three-year performance period for our CEO were outand other U.S.-based executive officers​​2020​
✓​​Restructured director pay to be based on a set target value instead of favor

fixed share grants		​

LOGO

​		2019

Compensation Committee eliminated​

✓​​Eliminated special option grants to the CEO in ​​2019

​

LOGO

✓		​

Compensation to Board of Directors should be better aligned with best practices

​		Added enhanced disclosure on certain items such as goal achievement

LOGO

​		​

Restructured director compensation to eliminate fixed share grants and instead use target dollar value equity awards

2017		​

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​		​

Need for enhanced disclosure about our Corporate Responsibility efforts

​		ESG

LOGO

​		​

New disclosure detailing our commitment to patients, employees, the community and the environment

​		​

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✓		​

Not enough​

Added ESG goals to our Annual Incentive Plan​​2022​
✓​​Disclosed ethnic and racial diversity data for U.S. workforce​​2021​
✓​​Enhanced ESG disclosure​​2019​
Stockholder feedback in 2021 was largely positive, with investors expressing support for the progress Incyte has made in recent years. Our conversations focused on Board refreshment and diversity, executive compensation and ESG. We continue to progress in each of these areas. Beginning with Board refreshment and diversity, the graphic below highlights our improvements in this area as well as improvements related to outside Board commitments.
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​Stockholder Engagement​
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1.
Average number of outside public board commitments.
​
Changes to our executive compensation structure have also been well received. We believe that our current compensation structure, as described in more detail in subsequent pages of this Proxy Statement, strikes the right balance of motivation and retention for our executives. The graphic below shows the evolution of our executive compensation structure over the last several years.
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1.
Note that long-term compensation vests over 4 years.
​
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Executive Compensation Highlights
​
Incyte has made significant progress in ensuring executive compensation reflects our performance. Stockholder feedback has been a significant driver of the evolution of our compensation structure.
Below is a comprehensive list of our compensation policies and policy enhancements made in our continuing effort to be responsive to issues discussed during our stockholder outreach and to address advice provided by stockholder advisory firms.
​
What We Do​
​
​
✓
We pay for performance, including having a total stockholder return (TSR) component for 2021 performance shares
​
​​
✓
We have a compensation for executive officers

clawback policy
​
​
​

LOGO

Commencing in July 2018, executive officers receive 25%

✓
30% of executives’ target equity award value is in the form of performance shares tied(and that percentage will increase to 33% for 2022)
​
​​
pre-specified✓ performance goals


Our Compensation Committee uses an independent compensation consultant, Compensia, and considers peer groups in establishing executive compensation
​
​

LOGO

​
✓
Performance shares have a three-year performance period
​

​

​
“Plurality-plus”✓ voting for directors
Robust anti-hedging and anti-speculation policies in uncontested elections not preferred

place
​

LOGO

Our Bylaws now require majority voting for directors in uncontested elections

​

LOGO

​
✓
Robust stock ownership guidelines for our CEO, executive officers and our directors
​

No clawback policy for executives

​		​

LOGO

✓
Our Compensation Committee is comprised of all independent directors
​

Adopted a 3 year cash clawback for executives

​

LOGO

​
✓
Double-trigger equity vesting in the event of a change-in-control
​

No minimum vesting period for employee equity​

​
✓
We conduct an annual say-on-pay vote
​
​
​
✓
Equity awards

LOGO

Implemented have a minimum vesting period of 12 months generally for employees

with a vesting period over 4 years.
​
​​
✓
We engage proactively with our stockholders throughout the year
​
​
​
What We Don’t Do​
​

LOGO

​
✗
We do not reprice stock options
​

Need for further diversification of expertise on Board and executive team

​		​

LOGO

✗
We do not provide golden parachute excise tax gross-ups
​

Increased gender diversity on our Board and our executive team

​
​
6 ✗
We do not provide single-trigger equity vesting in the event of a change-in-control
​
​​
✗
We do not provide excessive perquisites for executives
​
​
Executive compensation at Incyte comprises both salary and an annual cash bonus opportunity, as well as a long-term equity compensation program that is allocated between restricted stock units, performance shares and stock options.
In early 2022, the Compensation Committee considered the result of the stockholder advisory vote, direct feedback from investors and market-driven data guidance from the Committee’s independent compensation consultant, Compensia, and decided to make the following adjustments for 2022:
•
Change the equity mix for its U.S.-based executives from 40% stock options, 30% restricted stock units and 30% performance shares to equal proportions of the total grant date target dollar value awarded
​
•
The 2022 equity awards total grant date target dollar values were increased as follows:
​
•
CEO total grant date target value was increased from $12,400,000 to $13,400,000;
​
•
For other executive officers, the total grant date target values increased from a range of $500,000 to $2,200,000 to a range of $500,000 to $4,200,000
​
•
The cash bonus targets were increased as follows:
​
•
The CEO cash bonus target was increased from 100% to 110% of base salary;
​
​
14|Proxy Statement 20192022
​LOGO​
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​

TABLE OF CONTENTS
​Executive Compensation Highlights​
•
The funding targets for other executive officers were adjusted from 50% to range between 50% and 60% of base salary based on individual roles
​
CEO Compensation versus Peers
The compensation of our CEO is in-line with our peer group’s compensation as disclosed in 2021 proxy reports, with Mr. Hoppenot’s at-risk compensation percentage higher than that of the peer group average.
CEO AT-RISK COMPENSATION IS HIGHER THAN PEER GROUP
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Average peer CEO compensation reflects 2020 compensation from the 2021 proxies of the peer group.
​
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​​
Proxy Statement 2022|15
​
TABLE OF CONTENTS​
Global Responsibility
​
Our commitment to operating responsibly is a core purpose of our organization. Incyte was founded on the objective of discovering and developing novel therapies for patients in need. As the company has grown, we have challenged ourselves to also Expect More. Operating a sustainable business means more to us than creating solutions and generating revenues. It means giving back to our communities, protecting our planet and supporting our colleagues. It also means a commitment to ethical and responsible behavior in all aspects of our business.
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Incyte’s Global Responsibility initiatives are driven by the Executive Team. Oversight on set objectives is then provided by the entire Board of Directors.
For the most up to date Environmental, Social and Governance information, please visit
www.incyte.com/responsibility. Please note that the information provided on our website is not part of this Proxy Statement.
Below are Global Responsibility areas of focus that have been communicated as top priorities by our stakeholders.
Human Capital Management
In order to collectively achieve our goal of delivering novel therapies to patients, it is important to cultivate an environment where our colleagues know they are valued members of our team.
​
16|Proxy Statement 2022
​​
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TABLE OF CONTENTS
​Global Responsibility​
To that end, below are improvements executed during 2021 to better protect and support our colleagues:
Area of Focus​​Progress in 2021​
Professional Development​    Stockholder Engagement    

​
✓
Revamped individual development planning to focus on the most relevant core competencies for each division
​
✓
Added pilot program for continuing education
​
​
What We Heard
Safety and
Wellness
​What We Did​
✓
Required all employees and those who enter our buildings to be fully vaccinated against COVID-19
​
✓
Offered COVID-19 vaccinations and testing on-site
​
✓
Eliminated use of PTO when sick
​
​

LOGO

Compensation
and Benefits
​

Insufficient rationale​

✓
Adjusted 2022 merit increases to reflect higher inflation
​
✓
Added Wellthy, which provides personalized support to help tackle the logistical and administrative tasks related to caring for family
​
✓
Added Hinge, which provides exercise therapy tailored to each employee’s specific need
​
✓
Added Omada, which provides personalized support to achieve individual health goals
​
✓
Updated parental leave policy:
​
✓
Primary caregivers are now entitled to a total of 16-18 weeks of family leave inclusive of short-term disability
​
✓
Secondary caregiver is entitled to 4 weeks of family leave
​
​
Recognition
​​​​​​
​
We were proud to be named the #2 Top Employer by Science in 2021, making it four consecutive years that Incyte has been ranked in the top three of this global survey.
Incyte was recognized specifically for:
✓
being socially responsible
​
✓
having loyal employees
​
✓
treating employees with respect
​
​​
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​
​
For the first time, Incyte was recognized as one of Newsweek’s Top 100 Most Loved Workplaces for 2021. We ranked #77 on why CEO also servesthe list and were one of four biopharma companies included in the list.
Newsweek noted that Incyte was loved because of benefits such as the Chairman of the Board

LOGO

Provided more insight into the Board’s rationale behind our current leadership structure,100% coverage for health insurance as well as enhanced detail onparental leave for all situations, such as in the functioncase of adoption.

​​
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​
Diversity
We know that our continued and future success depends on the creativity that only a diverse team can generate. Diversity of thoughts, backgrounds, perceptions and ideas helps us create the medical solutions that patients require.
​
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​​
Proxy Statement 2022|17
​
TABLE OF CONTENTS
​Global Responsibility​
Gender Diversity
As of December 31, 2021, 51% of our global workforce are women, and 38% of our global leadership positions are filled by women.
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​
1.
Includes positions of Director and above.
​
Ethnic and Racial Diversity (U.S.)
​
As of December 31, 2021, 33% of our Lead Independent Director

LOGO

Limited detail on corporate goals

LOGO

Provided a more detailed retrospective analysisU.S. workforce self-reported as non-white, which is comparable to the 2020 United States Census data from the State of Delaware, the location of our 2017 and 2018 corporate goals, and also general prospective overviewglobal headquarters (38% non-white). We do not collect racial diversity data outside of current year goals

LOGO

No official stock ownership guidelines for Board and executives

LOGO

Implemented robust stock ownership guidelinesthe U.S., given various privacy restrictions.

We are committed to recruiting from the most diverse talent pool possible. This is true for our Board,workforce, our CEOExecutive Management Team and all other executive officers

LOGO

leadership positions across the organization.		​

Excise taxgross-ups are not in line with best practices

​
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LOGO

Eliminated excise taxgross-ups

LOGO

Insider trading policy unclear to stockholders

LOGO

Enhanced disclosure to make clear that robust anti-hedging and anti-speculation policies are in place​

Executive Management Team Diversity
Our Executive Management Team (“ET”) is made up of a diverse group of individuals with a range of experiences and backgrounds. Nine of the thirteen ET members were born outside of the U.S. We continuallybelieve this diversity of perspectives and approaches drives innovation, fosters new ideas and creates a work environment that values equality and collaboration.
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​
18|Proxy Statement 2022
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TABLE OF CONTENTS
​Global Responsibility​
U.S. Diversity and Inclusion Initiative
We support all actions that remove barriers and provide increased opportunities to underrepresented groups. Our Inclusion Committee in the U.S. is co-chaired by our Chief Executive Officer and our Head of Human Resources and brings forth actionable plans related to diversity and inclusion. The Committee established 5 key sub-committees, each with a different area of focus:
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Minimizing our Environmental Impact
Incyte is committed to operating in a way that minimizes our environmental impact. Since the spring of 2020, when we published our inaugural SASB Summary, we have worked to expand upon our environmental measurements and disclosures and seek solutions that may reduce our impact on the environment. During 2021, we transitioned the source of our electricity at U.S. Headquarters to engage with stockholders throughout the year,be 100% renewable. We also completed a project to make airflow in our labs more efficient.
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​
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​​
Proxy Statement 2022|19
​
TABLE OF CONTENTS
​Global Responsibility​
For our 2020 measured emissions, our objective was to find more local carbon credit projects, and we invite youwere able to partner with NCX to achieve that goal. NCX seeks to protect existing forests by working with individual landowners who would otherwise harvest their trees for income. The support forest owners receive typically goes towards paying their property taxes or land maintenance costs. Through our partnership, we are helping to support landowners and protect forests in the Mid-Atlantic region, and specifically for our neighbors in Delaware, while also working towards achieving our carbon reduction goals.
Global Responsibility Goals
In the 2021 Proxy Statement, we disclosed our key environmental target to be an operationally carbon neutral organization by 2025. In addition, we set three environmentally-related goals, as shown below, and we have already made progress toward their achievement.
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​
(1)
The TCFD (Task Force on Climate-related Financial Disclosures) has developed recommendations for voluntary, consistent climate-related financial risk disclosures for use by companies in providing information to investors, lenders, insurers, and other stakeholders.
​
Our key environmental target is to attain operation carbon neutrality by 2025 and we aim to reach out with any comments or questions at any time. Please see the Investor sectionthis target through combinations of absolute CO2 reductions and offsets of our websiteremaining emissions. We implemented three specific tactical goals to support our efforts and we have already achieved one, which was to obtain Green Globe’s Certification for our U.S. Headquarters building. Green Globes is a comprehensive, science-based building rating system that also takes into consideration the appropriate contact information.

operations of the building. By incorporating the initial design/construction along with the operational review by Green Globes, the certification is an accurate view of a building’s true level of sustainability. We continue to work on the transition of our fleet to hybrid or electric options, and we remain confident in our ability to achieve this goal on time. We are also on track to report under TCFD by 2023. We continue to make progress on our goal of operational neutrality, and our top priority is to complete the measurement of our global Scope 1 and Scope 2 emissions.
In early 2022, we added three ESG goals to our 2022 Annual Incentive Plan. The first goal is related to increasing diversity in our U.S. workforce. The second is tied to reducing single-use plastics. The last goal is to achieve Green Globes Certification for Building 1709, which we have now received. In 2021, we completed the construction of Building 1709, a site dedicated to labs and offices to support the growth of our company, at our U.S. Headquarters in Wilmington, DE. Following this completion and through our work with Green Globes, we achieved Green Globes Certification in March 2022. The building was granted 3 out of the 4 available Globes, a substantial achievement for a building containing laboratory space. It is our belief that by connecting short-term compensation to ESG metrics, we can incentivize the full organization to attain rapid and meaningful results.
​
LOGO
20|Proxy Statement 2019 2022| 7
​​
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TABLE OF CONTENTS​
Proposal2022 Proposals
​
PROPOSAL 1

Election of Directors

​
The Board proposes the election of eight directors of our Company to serve until the next annual meeting of stockholders, or thereafter until their successors are duly elected and qualified. If any nominee is unable or declines to serve as director at the time of the Annual Meeting, an event that we do not currently anticipate, proxies will be voted for any nominee designated by the Board to fill the vacancy.

    Committee Membership
Name and Primary Occupation 

Director

Since

 Age Independent  Compensation Audit 

Nominating

and Corporate

Governance

  Finance

Hervé Hoppenot—Chairman of the Board

 2014 59     ●

President and Chief Executive Officer

       

Incyte Corporation

       

Julian C. Baker—Lead Independent Director

 2001 52  ●  ●   LOGO  ●

Managing Partner

       

Baker Brothers Investments

       

Jean-Jacques Bienaimé

 2015 65  ●  ●   

Chief Executive Officer

       

BioMarin Pharmaceutical Inc.

       

Paul A. Brooke

 2001 73  ●  LOGO LOGO  ●  LOGO

Former Founder and Managing Partner

venBio, LLC

       

Paul J. Clancy

 2015 57  ●   LOGO  

Executive Vice President

and Chief Financial Officer

     

 

LOGO

  

Alexion Pharmaceuticals, Inc.

       

Wendy L. Dixon, Ph.D.

 2010 63  ●   ●  ●  

Former Chief Marketing Officer and

       

President, Global Marketing

       

Bristol-Myers Squibb Company

       

Jacqualyn A. Fouse, Ph.D.

 2017 57  ●     

Chief Executive Officer

       

Agios Pharmaceuticals, Inc.

       

Paul A. Friedman, M.D.

 2001 76  ●     

Chief Executive Officer

       

Madrigal Pharmaceuticals, Inc.

       

LOGO   Committee ChairLOGO   Financial Expert●    Member

8 | Proxy Statement 2019LOGO

Dr. Wendy L. Dixon is retiring from our Board as of the Annual Meeting. We are very grateful for her years of service to Incyte and to our stockholders.
    Proposal 1 Election of Directors    

Director Nominees

Names of the nominees and certain biographical information about them are set forth below:

Hervé
Hoppenot
​​
CHAIRMAN OF
THE BOARD
Age: 62
​​
COMMITTEES:
•
None
​
​​
DIRECTOR SINCE:
2014
​
Hervé Hoppenot

Age 59

Director since 2014

Chairman of the

Board

Committees

• Finance

BACKGROUND

BACKGROUND:
Mr. Hoppenot joined Incyte as President and Chief Executive Officer and a Director in January 2014, and was appointed Chairman of the Board in May 2015. Mr. Hoppenot served as the President of Novartis Oncology, Novartis Pharmaceuticals Corporation, the U.S. subsidiary of Novartis AG, a pharmaceutical company, from January 2010 to January 2014. Prior to that, Mr. Hoppenot served in other executive positions at Novartis Pharmaceuticals Corporation, serving from September 2006 to January 2010 as Executive Vice President, Chief Commercial Officer of Novartis Oncology and Head of Global Product Strategy & Scientific Development of Novartis Pharmaceuticals Corporation and from 2003 to September 2006 as Senior Vice President, Head of Global Marketing of Novartis Oncology. Prior to joining Novartis, Mr. Hoppenot served in various increasingly senior roles at Aventis S.A. (formerly Rhône Poulenc S.A.), a pharmaceutical company, including as Vice President Oncology US of Aventis Pharmaceuticals, Inc. from 2000 to 2003 and Vice President US Oncology Operations of Rhone Poulenc Rorer Pharmaceuticals, Inc. from 1998 to 2000.

QUALIFICATIONS

QUALIFICATIONS:
The Board has concluded that Hervé Hoppenot should serve on the Board because he has significant leadership and senior management experience from his various executive positions in the healthcare industry, including as the President of Novartis Oncology, Novartis Pharmaceuticals Corporation. His past experiences and his current role as our CEO give him strong knowledge of our strategy, markets, competitors, financials and operations.

OTHER PUBLIC COMPANY BOARDS

BOARDS:
​
Current
Cellectis S.A.
​
​Current
Past 5 Years
None
​
​
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​​
Proxy Statement 2022|21
​
TABLE OF CONTENTS
​
PROPOSAL 1 Election of Directors​
​
Julian C.
Baker
​​
LEAD
INDEPENDENT
DIRECTOR
Age: 55
​​
COMMITTEES:
•
Nominating and Corporate
Governance (Chair)
​
•
Compensation
​
​​
DIRECTOR SINCE:
2001
​
Cellectis S.A.None
BACKGROUND:

Julian C. Baker

Age 52

Director since 2001

Lead Independent

Director

Committees

• Compensation

• Finance

• Nominating & Corporate Governance (Chair)

BACKGROUND

Mr. Baker is a Managing PartnerMember of Baker Brothers Investments,Bros. Advisors LP, which he and his brother, Felix Baker, Ph.D., founded in 2000. Baker Brothers InvestmentsBros. Advisors LP is ana biotechnology-focused investment advisor focused on long term investments in life sciences companies.to fund partnerships whose investors are primarily endowments and foundations. Mr. Baker’s career as a fund manager began in 1994 when heco-founded a biotechnology investing partnership with the Tisch family. Previously, Mr. Baker was employed from 1988 to 1993 by the private equity investment arm of Credit Suisse First Boston Corporation.

QUALIFICATIONS

QUALIFICATIONS:
The Board has concluded that Julian C. Baker should serve on the Board because he is an experienced investor in many life sciences companies. He brings to the Board significant strategic and financial expertise and extensive knowledge of the life sciences and biopharmaceuticals industries as a result of his investments in and service as a director of other publicly and privately held life sciences companies.

OTHER PUBLIC COMPANY BOARDS

BOARDS:
​
Current
ACADIA Pharmaceuticals Inc.
Prelude Therapeutics Incorporated
​
​Current
Past 5 Years
Acadia Pharmaceuticals,
Genomic Health, Inc.		 (2001-2019)
Idera Pharmaceuticals, Inc. (2014-2018)		​
Jean-Jacques
Bienaimé
​​
INDEPENDENT
DIRECTOR
Age: 68
​​
COMMITTEES:
•
Compensation (Chair)
​
•
Nominating and Corporate
Governance
​
​​
DIRECTOR SINCE:
2015
​
Genomic Health, Inc.

LOGO
BACKGROUND:
Proxy Statement 2019 | 9

    Proposal 1 Election of Directors    

Jean-Jacques

Bienaimé

Age 65

Director since 2015

Independent Director

Committees

• Compensation

BACKGROUND

Mr. Bienaimé has served as Chief Executive Officer and a member of the board of directors of BioMarin Pharmaceutical Inc., a biopharmaceutical company, since May 2005. Mr. Bienaimé has also served as Chairman of BioMarin since June 2015. From November 2002 to April 2005, Mr. Bienaimé served as Chairman, Chief Executive Officer and President of Genencor, a biotechnology company focused on industrial bioproducts and targeted cancer biotherapeutics. Prior to joining Genencor, Mr. Bienaimé was Chairman, President and Chief Executive Officer of SangStat Medical Corporation, an immunology focused biotechnology company that was later acquired by Genzyme Corporation. He became President of SangStat in 1998 and Chief Executive Officer in 1999. Prior to joining SangStat, Mr. Bienaimé held various management positions from 1992 to 1998 with Rhône Poulenc Rorer Pharmaceuticals (now known as Sanofi Aventis), including Senior Vice President of Corporate Marketing and Business Development, and Vice President and General Manager of the advanced therapeutic and oncology division. Mr. Bienaimé is a director of the Biotechnology Innovation Organization and the Pharmaceutical Research and Manufacturers of America® (PhRMA).

QUALIFICATIONS

QUALIFICATIONS:
The Board has concluded thatJean-Jacques Bienaimé should serve on the Board because he has significant leadership experience in the management of biotechnology organizations, business development, and sales and marketing of both biotechnology and pharmaceutical products. He also brings significant experience as a director of other publicly held life sciences companies.

OTHER PUBLIC COMPANY BOARDS

BOARDS:
​
Current
BioMarin Pharmaceutical Inc.
​
​Current
Past 5 Years
BioMarin Pharmaceutical Inc.

InterMune, Inc. (2012-2014)

Portola Pharmaceuticals, Inc.
(2010-2014)

Vital Therapies, Inc. (2013–2018)

(2013-2018)		​

​
22|Proxy Statement 2022
​​
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TABLE OF CONTENTS
​
PROPOSAL 1 Election of Directors​
​
Otis W.
Brawley, M.D.
​​
INDEPENDENT
DIRECTOR
Age: 62
​​
COMMITTEES:
•
Science and Technology
​
​​
DIRECTOR SINCE:
2021
​
Paul A. Brooke

Age 73

Director since 2001

Independent Director

Committees

• Audit

• Compensation

(Chair)

• Finance (Chair)

• Nominating & Corporate Governance

BACKGROUND

Mr. Brooke was a founder and managing partner of venBio, LLC, a pharmaceutical investment company, from which he retired at the end of 2016. Mr. Brooke was Chairman of the Board of Directors of Alsius Corporation, a medical device company, from June 2007 through its sale in May 2009, and was the Chairman and Chief Executive Officer of a predecessor company from April 2005 to June 2007. Mr. Brooke

BACKGROUND:
Dr. Brawley has been the Managing Member of PMSV Holdings, LLC, a private investment firm, since 1993. He also served as a Senior Advisor to Morgan Stanley & Co. Incorporated fromBloomberg Distinguished Professor of Oncology and Epidemiology at Johns Hopkins University since January 2019. From April 20002007 to December 2009,2018, Dr. Brawley served as the Chief Medical and Scientific Officer of the American Cancer Society. From January 2002 to August 2007, Dr. Brawley was a Venture Partnerdirector of the Georgia Cancer Center at MPM Capital, a venture capital firm specializing in the healthcare industry, from 1997 through 2006.Grady Memorial Hospital. From April 1999 through May 2000, Mr. Brooke2001 to December 2018, Dr. Brawley served as a Managing DirectorProfessor of hematology, oncology, medicine and epidemiology at Tiger Management LLC. HeEmory University. Prior to joining Emory University, Dr. Brawley was a Managing Directoran assistant director and senior investigator at the Global HeadNational Cancer Institute and an internist and oncologist at the National Institutes of Healthcare ResearchHealth Clinical Center and Strategy at Morgan Stanley & Co. from 1983 to April 1999. Mr. Brooke is also a director of several privately held companies.

QUALIFICATIONS

Bethesda Naval Hospital.

QUALIFICATIONS:
The Board has concluded that Paul A. BrookeOtis W. Brawley should serve on the Board because he has significant medical and scientific leadership experience. Dr. Brawley’s medical and academic background in oncology and hematology, together with his medical, scientific and public health leadership experience, are expected to assist the Board in its oversight role over our drug discovery and development efforts and to provide the Board with relevant insight into the operations, challenges and complex issues facing healthcare companies gained from hisdelivery. In addition, Dr. Brawley has experience as head of healthcare research at a major investment bank and as an investor. He also has extensive financial and capital markets experience, which is critical to his role as Chair of the Finance Committee, and significant experienceserving as a director of other publicly and privately held life sciences and healthcare companies.

OTHER PUBLIC COMPANY BOARDS

BOARDS:
​
Current
Agilent Technologies, Inc.
Lyell Immunopharma, Inc.
PDS Biotechnology Corporation
​
​Current
Past 5 Years
None
​
Paul J.
Clancy
​​
INDEPENDENT
DIRECTOR
Age: 60
​​
COMMITTEES:
•
Audit and Finance (Chair)
​
•
Compensation
​
​​
DIRECTOR SINCE:
2015
​
Manning & Napier Fund, Inc.ViroPharma Incorporated(2001-2014)
BACKGROUND:

10 | Proxy Statement 2019LOGO

    Proposal 1 Election of Directors    

Paul J. Clancy

Age 57

Director since 2015

Independent Director

Committees

• Audit (Chair)

BACKGROUND

Mr. Clancy has more than 30 years of experience in financial management and strategic business planning, and has served as a senior advisor from October 2019 until July 2020 to, and as the Executive Vice President and Chief Financial Officer from July 2017 through October 2019 of, Alexion Pharmaceuticals, Inc., a biopharmaceutical company, since July 2017.company. Prior to joining Alexion, Mr. Clancy served as Executive Vice President, Finance and Chief Financial Officer of Biogen Inc. (formerly known as Biogen Idec Inc.), a biopharmaceutical company, from August 2007 until June 2017. He also served as Senior Vice President of Finance of Biogen, with responsibilities for leading the treasury, tax, investor relations and business planning groups. Prior to the 2003 merger of Biogen, Inc. and IDEC Pharmaceuticals Corporation to form Biogen, Mr. Clancy was the Vice President of Portfolio Management of Biogen. He joined Biogen in 2001 as Vice President of U.S. Marketing. Before Biogen, Mr. Clancy spent 13 years at PepsiCo Inc., a food and beverage company, serving in a variety of financial, strategy and general management positions, including Vice President and General Manager of their Great West Business Unit.

QUALIFICATIONS

positions.

QUALIFICATIONS:
The Board has concluded that Paul J. Clancy should serve on the Board because he has significant financial and executive leadership experience at largemulti-national biopharmaceutical companies. Mr. Clancy also has experience as a director of a publicly held biotechnology company, and his breadth and depth of financial experience position him well to serve onas Chair of the Audit and Finance Committee of the Board.

OTHER PUBLIC COMPANY BOARDS

BOARDS:
​
Current
Agios Pharmaceuticals, Inc.
Exact Sciences Corporation
Xilio Therapeutics, Inc.
​
​Current
Past 5 Years

None
Agios Pharmaceuticals, Inc.None​

​
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​​

Wendy L. Dixon,

Ph.D.

Age 63

Director since 2010

Independent Director

Committees

• Audit

• Nominating & Corporate Governance

BACKGROUND

Dr. Dixon served as Chief Marketing Officer and President, Global Marketing for Bristol Myers Squibb Company from December 2001 until May 2009 and served on the Chief Executive Officer’s Executive Committee. From 1996 to 2001 she was Senior Vice President, Marketing—USHH at Merck & Co., Inc., and prior to that she held executive management positions at West Pharmaceuticals, Osteotech, Inc. and Centocor, Inc. and various positions at SmithKline & French Pharmaceuticals in marketing, regulatory affairs, project management and as a biochemist.

QUALIFICATIONS

The Board has concluded that Wendy L. Dixon should serve on the Board because she has significant leadership experience in the pharmaceutical and biotechnology industry, including experience in drug development and regulatory affairs. Dr. Dixon has extensive experience in building successful marketing and sales teams and launching multiple pharmaceutical products across a broad range of therapeutic areas. Dr. Dixon also has significant experience serving as a director of other publicly held life sciences companies, including as a member of certain audit committees.

OTHER PUBLIC COMPANY BOARDS

CurrentPast 5 Years
Alkermes plcFuriex Pharmaceuticals, Inc.(2010-2014)
bluebird bio, Inc.Orexigen Therapeutics, Inc.(2010-2016)
Sesen Bio, Inc.
Voyager Therapeutics, Inc.

LOGO
Proxy Statement 2019 2022| 1123
​

TABLE OF CONTENTS
​
    Proposal
PROPOSAL 1 Election of Directors​
​

Jacqualyn A.
Fouse, Ph.D.
​​
INDEPENDENT
DIRECTOR
Age: 60
​​
COMMITTEES:
•
Audit and Finance
​
•
Nominating and Corporate
Governance
​
​​
DIRECTOR SINCE:
2017
​

Jacqualyn

A. Fouse, Ph.D.

Age 57

Director since 2017

Independent Director

Committees

• None

BACKGROUND

BACKGROUND:
Dr. Fouse has served as Chief Executive Officer of Agios Pharmaceuticals, Inc., a biopharmaceutical company, since February 2019. Prior to Agios, she served as Executive Chair of Dermavant Sciences, a biopharmaceutical company from July 2017 to September 2018. From September 2010 until June 2017, Dr. Fouse served in various capacities at Celgene Corporation, a biopharmaceutical company, serving as Strategic Advisor to the Management Executive Committee from April 2017 to June 2017, President and Chief Operating Officer from March 2016 to March 2017, President, Hematology and Oncology from August 2014 to February 2016, Executive Vice President and Chief Financial Officer from February 2012 to July 2014, and Senior Vice President and Chief Financial Officer from September 2010 to February 2012. Prior to joining Celgene, Dr. Fouse served as Chief Financial Officer of Bunge Limited, a global agribusiness and food company, from July 2007 to September 2010. Prior to joining Bunge, Dr. Fouse served as Senior Vice President, Chief Financial Officer and Corporate Strategy at Alcon Laboratories, Inc. since 2006, and as its Senior Vice President and Chief Financial Officer since 2002. Prior to her time with Alcon she held a variety of senior leadership roles with international companies.

QUALIFICATIONS

QUALIFICATIONS:
The Board has concluded that Jacqualyn A. Fouse should serve on the Board because she has significant corporate finance, financial reporting and accounting expertise as a result of her executive roles at Agios and previously at Dermavant Sciences and Celgene, as well as her prior positions with other companies. Additionally, Dr. Fouse is able to provide diverse and valuable corporate governance, management, operational and strategic expertise to the Board through her experience as an executive officer and a public company board member.

OTHER PUBLIC COMPANY BOARDS

BOARDS:
​
Current
Agios Pharmaceuticals, Inc.
​
​Current
Past 5 Years
Agios Pharmaceuticals, Inc.Perrigo Company
(2012-2016)Celgene Corporation (2016-2017)

Dick’s Sporting Goods, Inc. (2010-2020)		Celgene Corporation(2016-2017)​

Edmund P.
Harrigan, M.D.
​​
INDEPENDENT
DIRECTOR
Age: 69
​​
COMMITTEES:
•
Science and Technology (Chair)
​
​​
DIRECTOR SINCE:
2019
​
12 | Proxy Statement 2019LOGO

    Proposal 1 Election of Directors    

Paul A. Friedman,

BACKGROUND:

Edmund P. Harrigan, M.D.

Age 76

Director since 2001

Independent Director

Committees

• None

BACKGROUND

Dr. Friedman has served as Chief Executive Officer and Chairman of joined the Board of Directors of Madrigal Pharmaceuticals, Inc., a biopharmaceutical company, since July 2016.in December 2019. Dr. Friedman served as our Chief Executive Officer from November 2001 to January 2014 and was our President from May 2004 to January 2014. From 1998 until October 2001, Dr. Friedman served as President of DuPont Pharmaceuticals Research Laboratories, a wholly owned subsidiary of DuPont Pharmaceuticals Company (formerly The DuPont Merck Pharmaceutical Company), from 1994 to 1998 he served as President of Research and Development of The DuPont Merck Pharmaceutical Company, and from 1991 to 1994 heHarrigan served as Senior Vice President of Worldwide Safety and Regulatory for Pfizer Inc. from 2012 until his retirement in 2015. Dr. Harrigan’s previous executive leadership roles at Merck Research Laboratories.Pfizer included serving as Senior Vice President, Head of Worldwide Business Development, Senior Vice President, Head of Worldwide Regulatory Affairs and Quality Assurance, and Vice President, Head of Neuroscience and Ophthalmology. Previously, Dr. Harrigan served in senior leadership positions at Karuna Pharmaceuticals, Inc., Sepracor Inc., and Neurogen Corporation. Prior to his work at Merck and DuPont,entering the pharmaceutical industry in 1990, Dr. FriedmanHarrigan was an Associate Professor of Medicine and Pharmacology at Harvard Medical School. Dr. Friedman is a Diplomate of the American Board of Internal Medicine and a Member of the American Society of Clinical Investigation. Dr. Friedman is a director of two privately held companies.

QUALIFICATIONS

practicing neurologist for seven years.

QUALIFICATIONS:
The Board has concluded that Paul A. FriedmanEdmund P. Harrigan should serve on the Board because he has extensive expertise in our business andsignificant executive leadership experience in the pharmaceutical and biotechnology industry, including experience in drug discovery and development, regulatory affairs and discovery industry. His past experiences, including as our former CEO, give him strong knowledge of our strategy, markets, competitors, financialsbusiness development. Dr. Harrigan also brings substantial medical and operations. He alsoscientific experience to the Board. In addition, Dr. Harrigan has significant experience serving as a director of other publicly held life sciences and healthcare companies.

OTHER PUBLIC COMPANY BOARDS

BOARDS:
​
Current
ACADIA Pharmaceuticals, Inc.
PhaseBio Pharmaceuticals, Inc.
​
​Current
Past 5 Years
Alexion
Bellicum Pharmaceuticals, Inc.		Auxilium (2018-2019)
Pharmaceuticals, Inc. (2010-2015)
Madrigal Pharmaceuticals, Inc.Cerulean Pharma Inc.(2014-2017)
DurataKaruna Therapeutics, Inc.(2013-2014) (2011-2020)
Verastem, Inc.(2014-2017)​

​

LOGO

The Board recommends a vote“FOR” election as director of each of the nominees set forth above.24

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TABLE OF CONTENTS
​
PROPOSAL 1 Election of Directors​
​
Katherine A.
High, M.D.
​​
INDEPENDENT
DIRECTOR
Age: 70
​​
COMMITTEES:
•
Science and Technology
​
​​
DIRECTOR SINCE:
2020
​
BACKGROUND:
Katherine A. High, M.D., joined the Board in March 2020. Dr. High has served as President, Therapeutics of Asklepios Biopharmaceutical, Inc., a biotechnology and gene therapy company that is a wholly-owned subsidiary of Bayer AG, since January 2021. Dr. High served as President of Spark Therapeutics, Inc., a gene therapy company, from September 2014 until February 2020 and as Head of Research and Development of Spark from September 2017 until February 2020. From September 2014 through September 2017, Dr. High served as Chief Scientific Officer of Spark. Prior to serving as President of Spark, Dr. High provided advice to Spark and subsequently served as an independent consultant to Spark from December 2013 to September 2014. From July 1999 through September 2014, Dr. High was a Professor at the Perelman School of Medicine at the University of Pennsylvania. From March 2003 through September 2014, Dr. High was an Investigator of the Howard Hughes Medical Institute. Dr. High served as the Director of the Center for Cellular and Molecular Therapeutics at Children’s Hospital of Philadelphia from September 2004 to April 2014.
QUALIFICATIONS:
The Board has concluded that Katherine A. High should serve on the Board because she has significant executive, scientific and medical leadership experience, including extensive academic and industry experience in drug discovery and development. Her medical background, together with her experience leading drug discovery and development efforts at Spark Therapeutics, are expected to assist the Board in its oversight role over our drug discovery and development efforts. In addition, Dr. High has experience serving as an executive officer and director of publicly traded life sciences companies.
OTHER PUBLIC COMPANY BOARDS:
​
Current
CRISPR Therapeutics AG
​​
Past 5 Years
Spark Therapeutics, Inc. (2014-2019)
​
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Proxy Statement 2022|25
​
TABLE OF CONTENTS​
Board Committees

​
The Board has appointed an Audit and Finance Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee and a Science and Technology Committee. The Board has determined that each director who serves on these committees is “independent,” as that term is defined by applicable listing standards of The Nasdaq Stock Market and Securities and Exchange Commission rules. The Board has approved a charter for each of these committees, acommittees. A current copy of each committee’s charter can be found on our website athttp://www.incyte.com under the “Corporate Governance” heading in the “For Investors” portion of our website. The Board has also appointed a Finance Committee and aNon-Management Stock Option Committee.

The Board will update committee composition as appropriate after the Annual Meeting.
Audit and Finance Committee​​COMMITTEE MEMBERS​
Audit CommitteeCOMMITTEE MEMBERS
The Audit and Finance Committee’s responsibilities include:

Paul J. Clancy (Chair)

Paul A. Brooke

Wendy L. Dixon

Met 8 times in 2018

Ø➤
assisting the Board in fulfilling its oversight responsibilities relating to the Company’s financial statements, systems of internal control over financial reporting, auditing, accounting and financial reporting processes, and compliance with legal and regulatory requirements;

requirements, financing strategies, capital allocation, capital structure, and enterprise risk assessment;

​
Ø➤
appointing, compensating, evaluating and, when appropriate, replacing our independent registered public accounting firm;

​
Ø➤
reviewing andpre-approving audit and permissible non-audit services;
​
non-audit➤ services;

Ø

reviewing the scope of the annual audit;

​
Ø➤
monitoring the independent registered public accounting firm’s relationship with the Company;

​
Ø➤
meeting with the independent registered public accounting firm and management to discuss and review our financial statements, internal control over financial reporting, and auditing, accounting and financial reporting processes;

​
Ø➤
reviewing the results of management’s efforts to monitor compliance with the Company’s programs and policies designed to promote adherence to applicable laws and regulations; and

​
Ø➤
overseeing the management of risks associated with financial and accounting systems, accounting policies, public reporting, investment strategies and cybersecurity, including the periodic review of management’s efforts to identify and mitigate such risks.

risks;

​
➤
overseeing our internal audit function; and
​
➤
reviewing matters related to the Company’s capital allocation strategies, capital structure and tax structure.
​
The Board has determined that Mr. Clancy and Mr. BrookeDr. Fouse are each qualified as an Audit Committee Financial Expert under the definition outlined by the Securities and Exchange Commission;

Commission.

No membersmember of our Audit and Finance Committee sitsits on more than three public company audit committees, including ours.

​​
Paul J. Clancy (Chair)
Wendy L. Dixon1
Jacqualyn A. Fouse
Met 8 times in 2021
​

​
1.
Dr. Wendy L. Dixon is retiring from the Board as of the Annual Meeting.
​
​
26|Proxy Statement 2022
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TABLE OF CONTENTS
​Board Committees​
Compensation Committee​​COMMITTEE MEMBERS​
14 | Proxy Statement 2019LOGO

  Board Committees  

Compensation Committee

COMMITTEE MEMBERS

The Compensation Committee’s responsibilities include:

Paul A. Brooke (Chair)

Julian C. Baker

Jean-Jacques➤ Bienaimé

Met 8 times in 2018

Ø

assisting the Board in meeting its responsibilities with regard to oversight and determination of executive compensation;

​
Ø➤
reviewing and making recommendations with respect to major compensation plans, policies and programs of the Company;

​
Ø➤
developing and monitoring compensation arrangements for our executive officers;

​
Ø➤
determining compensation for our CEO and other executive officers;

​
Ø➤
determiningstock-based compensation awards for our executive officers;

​
Ø➤
administeringperformance-based compensation plans such as our Amended and Restated 2010 Stock Incentive Plan (the “2010 Stock Incentive Plan”);

​
Ø➤
reviewing and recommending directors’ compensation to the full Board; and

​
Ø➤
possessing sole authority to select, retain, terminate and approve the fees and other retention terms of consultants as it deems appropriate to perform its duties.

​
​​
Jean Jacques Bienaimé (Chair)
Julian C. Baker
Paul J. Clancy
Met 5 times in 2021
​
Nominating and Corporate Governance Committee​​COMMITTEE MEMBERS​

The Nominating and Corporate Governance Committee’s responsibilities include:

Julian C. Baker (Chair)

Paul A. Brooke

Wendy L. Dixon

Met 1 time in 2018

Ø➤
identifying qualified individuals to become members of the Board;

​
Ø➤
determining the composition of the Board and its committees;

​
Ø➤
monitoring a process to assess Board effectiveness;

​
Ø➤
recommending nominees to fill vacancies on the Board;

​
Ø➤
reviewing and making recommendations to the Board with respect to candidates for director proposed by stockholders;

​
Ø➤
reviewing the composition, functioning and effectiveness of the Board and its committees;

​
Ø➤
developing and recommending to the Board codes of conduct applicable to officers, directors and employees and charters for the various committees of the Board; and

​
Ø➤
reviewing and making recommendations to the Board regarding the succession plan relating to our CEO and other executive officers.

​
​​
Julian C. Baker (Chair)
Jean Jacques Bienaimé
Jacqualyn A. Fouse
Met 4 times in 2021
​
Science and Technology Committee​​COMMITTEE MEMBERS​
Finance CommitteeCOMMITTEE MEMBERS

The FinanceScience and Technology Committee’s responsibilities include:

Paul A. Brooke (Chair)

Julian C. Baker

Hervé Hoppenot

Did Not Meet in 2018

Ø➤
assisting the Board in its general oversight of the Company’s research and development programs and progress in achieving research and development goals and objectives;
​
➤
providing strategic financing matters;

advice to the Board and management regarding emerging science and technology issues and trends;

​
Ø➤
reviewing and recommending matters relatedassessing the Company’s approaches to the capital structure of the Company;acquiring and

maintaining technology positions or otherwise investing in research and development programs; and

​
Ø➤  exercising the powers of
assisting the Board that may be lawfully delegated towith its oversight responsibility for enterprise risk management in areas affecting the Finance CommitteeCompany’s research and development activities.
​
​​
Edmund P. Harrigan (Chair)
Otis W. Brawley
Katherine A. High
Met 2 times in connection with the authorization, issuance and sale of debt or equity securities of the Company.

2021
​

​
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Proxy Statement 2019 2022| 1527
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TABLE OF CONTENTS
​Board Committees​
​​​​​​​​​​​​Committee Membership​
Name and Primary Occupation​​
Director
Since
​​Age​​Independent​​Compensation​​
Audit and
Finance
​​
Nominating
and Corporate
Governance
​​
Science
and
Technology
​
Hervé Hoppenot—Chairman of the Board
President and Chief Executive Officer
Incyte Corporation
​​2014​​62​​​​​​​​​​​​​​​​
Julian C. Baker—Lead Independent Director
Managing Partner
Baker Brothers Investments
​​2001​​55​​
✓​
​​
[MISSING IMAGE: tm2025328d39-icon_memberpn.jpg]
​​​​​
[MISSING IMAGE: tm2025328d39-icon_chairpn.jpg]
​​​​
Jean-Jacques Bienaimé
Chief Executive Officer
BioMarin Pharmaceutical Inc.
​​2015​​68​​
✓​
​​
[MISSING IMAGE: tm2025328d39-icon_chairpn.jpg]
​​​​​
[MISSING IMAGE: tm2025328d39-icon_memberpn.jpg]
​​​​
Otis W. Brawley, M.D.
Bloomberg Distinguished Professor of Oncology and Epidemiology
Johns Hopkins University
​​2021​​62​​
✓​
​​​​​​​​​​​
[MISSING IMAGE: tm2025328d39-icon_memberpn.jpg]
​
Paul J. Clancy
Former Executive Vice President
and Chief Financial Officer
Alexion Pharmaceuticals, Inc.
​​2015​​60​​
✓​
​​
[MISSING IMAGE: tm2025328d39-icon_memberpn.jpg]
​​
[MISSING IMAGE: tm2025328d39-icon_chairpn.jpg] [MISSING IMAGE: tm2025328d39-icon_chirfinpn.jpg]
​​​​​​​
Wendy L. Dixon, Ph.D.1
Former Chief Marketing Officer and
President, Global Marketing
Bristol-Myers Squibb Company
​​2010​​66​​
✓​
​​​​​
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​​​​​​​
Jacqualyn A. Fouse, Ph.D.
Chief Executive Officer
Agios Pharmaceuticals, Inc.
​​2017​​60​​
✓​
​​​​​
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​​
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​​​​
Edmund P. Harrigan, M.D.
Former Senior Vice President of Worldwide Safety and Regulatory
Pfizer Inc.
​​2019​​69​​
✓​
​​​​​​​​​​​
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​
Katherine A. High, M.D.
President, Therapeutics
Asklepios Biopharmaceutical, Inc.
​​2020​​70​​
✓​
​​​​​​​​​​​
[MISSING IMAGE: tm2025328d39-icon_memberpn.jpg]
​
​
[MISSING IMAGE: tm2025328d39-icon_chairpn.jpg]
​​Committee Chair​​
[MISSING IMAGE: tm2025328d39-icon_chirfinpn.jpg]
​​Financial Expert​​
[MISSING IMAGE: tm2025328d39-icon_memberpn.jpg]
​​Member​
​
1.
Dr. Wendy L. Dixon is retiring from the Board as of the Annual Meeting.
​
​
28|Proxy Statement 2022
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TABLE OF CONTENTS​
Compensation of Directors
​
Our director compensation program is designed to attract and retain highly qualified directors by ensuring that our director compensation is in line with compensation offered by our peer companies that compete with us for director talent. The program is designed to address the time, effort, expertise and accountability required of active board membership. Directors who are employees of the Company, namely Mr. Hoppenot, do not receive any fees for their service on the Board or any committee. The Compensation Committee, with the assistance of its independent compensation consultant, periodically reviews the compensation for our non-employee directors in relation to the peer group used for compensation purposes (as described below under “Compensation Discussion and Analysis”).
In 2021, we sought approval for, and our stockholders approved, changes to our Amended and Restated 2010 Stock Incentive Plan (the “2010 Stock Incentive Plan”) that enable the Board to set the total grant date target value of equity awards to our non-employee directors up to a maximum of $500,000, which was the total grant date target value for equity awards made to non-employee directors in 2020. In addition, the mix of equity awards was changed from 75% stock options and 25% restricted stock unit (RSU) awards to 60% stock options and 40% RSU awards. For 2021, the Board, upon the recommendation of the Compensation Committee, reduced the total grant date target value of non-employee director equity awards from $500,000 to $400,000. Based on the Compensation Committee’s most recent review in November 2021, the Compensation Committee recommended, and in November 2021, the Board approved, retaining the total grant date target value of non-employee director equity awards at $400,000 through at least the 2023 annual meeting of stockholders.
In addition, in November 2021, based on the Compensation Committee’s review of compensation for non-employee directors of peer group companies, effective January 1, 2022, the Board increased the annual retainers for the Lead Independent Director from $90,000 to $100,000, the chair of the Nominating and Corporate Governance Committee from $16,000 to $18,000, members of the Audit and Finance Committee from $12,000 to $12,500 and members of the Nominating and Corporate Governance Committee from $8,000 to $9,000. All other annual retainers for committee membership and chair service remained the same.
Role​​
Cash Retainer
($)(1)
​​
Total Equity Awards
($)(2)
​
Lead Independent Director​​​​100,000​​​​​400,000​​
Non-Employee Director​​​​60,000​​​​​400,000​​
​
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TABLE OF CONTENTS
​Compensation of Directors​
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Role​​
Cash Retainer
($)(1)
​
Chair of Audit and Finance Committee​​​​25,000​​
Members of Audit and Finance Committee​​​​12,500​​
Chair of Compensation Committee​​​​25,000​​
Members of Compensation Committee​​​​10,000​​
Chair of Nominating and Corporate Governance Committee​​​​18,000​​
Members of Nominating and Corporate Governance Committee​​​​9,000​​
Chair of Science and Technology Committee​​​​25,000​​
Members of Science and Technology Committee​​​​10,000​​
​
(1)
Annual cash retainers are payable quarterly. Non-employee directors may elect to receive their retainers and committee fees in the form of restricted shares that vest immediately when the associated quarterly retainer amount is paid.
​
(2)
Equity awards are 60% stock options and 40% RSU awards, determined in the same manner as with awards to our executive officers, as described in “Compensation Discussion and Analysis.” The Board has determined that for 2021 and 2022, total grant date target value for equity awards will be $400,000 for all non-employee directors. The exercise price of the options will be equal to the fair market value on the date of grant and have a term of 10 years. Each award will vest in full on the first anniversary of the date of the grant or, if earlier, the date of the next annual meeting of stockholders or upon a change in control.
​
Cash and equity awards are prorated for such portion of the year that the director serves on the Board. All directors are reimbursed for their travel and out-of-pocket expenses in accordance with our travel policy for each in-person Board or committee meeting that they attend.
2021 Director Compensation Table
Name​​
Fees Earned
or Paid
in Cash
($)
​​
Stock
Awards
($)(1)(3)
​​
Option
Awards
($)(2)(3)
​​
Total
($)
​
Julian C. Baker​​​​—​​​​​275,917​​​​​239,875​​​​​515,792​​
Jean-Jacques Bienaimé​​​​69,750​​​​​159,917​​​​​239,875​​​​​469,542​​
Otis W. Brawley​​​​652​​​​​86,921​​​​​130,461​​​​​218,034​​
Paul J. Clancy​​​​—​​​​​254,917​​​​​239,875​​​​​494,792​​
Wendy L. Dixon​​​​—​​​​​231,917​​​​​239,875​​​​​471,792​​
Jacqualyn A. Fouse​​​​—​​​​​239,917​​​​​239,875​​​​​479,792​​
​
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TABLE OF CONTENTS
​Compensation of Directors​
Name​​
Fees Earned
or Paid
in Cash
($)
​​
Stock
Awards
($)(1)(3)
​​
Option
Awards
($)(2)(3)
​​
Total
($)
​
Edmund P. Harrigan​​​​—​​​​​229,917​​​​​239,875​​​​​469,792​​
Katherine A. High​​​​52,500​​​​​159,917​​​​​239,875​​​​​452,292​​
​
(1)
Amounts listed in this column represents the sum of the aggregate grant date value of restricted stock awards issued quarterly at the election of the director in lieu of his or her annual retainer and committee fees and the aggregate grant date fair value of RSU awards granted upon re-election at the 2021 Annual Meeting or, in the case of Dr. Brawley, upon his election to the Board, determined in accordance with the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (ASC 718) for financial reporting purposes. See Note 11 of the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of our assumptions in determining the ASC 718 values of our stock awards.
​
The following table provides the grant date value of restricted stock awards and the grant date fair value of RSUs shown in the above table:
Name​​
Value of
Restricted
Stock Awards
($)
​​
Grant Date Fair
Value of
RSU Awards
($)
​
Julian C. Baker​​​​116,000​​​​​159,917​​
Jean-Jacques Bienaimé​​​​—​​​​​159,917​​
Otis W. Brawley​​​​—​​​​​86,921​​
Paul J. Clancy​​​​95,000​​​​​159,917​​
Wendy L. Dixon​​​​72,000​​​​​159,917​​
Jacqualyn A. Fouse​​​​80,000​​​​​159,917​​
Edmund P. Harrigan​​​​70,000​​​​​159,917​​
Katherine A. High​​​​—​​​​​159,917​​
​
(2)
Amounts listed in this column represents the aggregate grant date fair value of option awards granted upon re-election at the 2021 Annual Meeting or, in the case of Dr. Brawley, upon his election to the Board, determined in accordance with the ASC 718 for financial reporting purposes. See Note 11 of the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of our assumptions in determining the ASC 718 values of our option awards.
​
(3)
The following table provides the number of shares of common stock subject to outstanding unvested RSU awards and options held at December 31, 2021 for each director who was then serving on the Board.
​
Name​​
Number of Unvested
RSU Awards
​​
Number of Shares
Underlying
Unexercised Option
​
Julian C. Baker​​​​1,923​​​​​145,996​​
Jean-Jacques Bienaimé​​​​1,923​​​​​120,996​​
Otis W. Brawley​​​​1,255​​​​​5,910​​
Paul J. Clancy​​​​1,923​​​​​120,996​​
Wendy L. Dixon​​​​1,923​​​​​125,996​​
Jacqualyn A. Fouse​​​​1,923​​​​​79,746​​
Edmund P. Harrigan​​​​1,923​​​​​22,884​​
Katherine A. High​​​​1,923​​​​​19,809​​
​
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TABLE OF CONTENTS​
Corporate Governance

​
​
What We Do​
​

LOGO

​

✓
Majority voting for directors in uncontested elections

​
​

LOGO

​

✓
Audit and Finance Committee receives semiannual updates by our Chief Compliance Officer

​
​

LOGO

​

✓
Strong and active Lead Independent Director, representing one of our largest stockholder

stockholders
​
​

LOGO

​
✓
Board and the committees may seek advice from outside advisors
​

​

​
✓
Audit and Finance Committee, Nominating and Corporate Governance Committee and Compensation Committee comprised solely of independent directors
​
​​
✓
Pre-clearance by our General Counsel required for trading in our stock by any director, and all executive trading must be through a pre-cleared trading plan
​
​
​
✓
Audit and Finance Committee regularly meets with Ernst & Young LLP, our independent registered public accounting firm, as well as our corporate audit services team—without members of executive management present
​
​​
✓
Maintain robust Code of Business Conduct and Ethics, Senior Financial Officers’ Code of Ethics and Board of Directors Code of Conduct and Ethics

requirements
​
​

LOGO

​

Audit Committee, Nominating and Corporate Governance Committee and Compensation Committee comprised solely of independent directors

LOGO

Pre-clearance✓ by our General Counsel required for trading in our stock by any director or executive officer

LOGO

Audit Committee regularly meets in executive session with Ernst & Young, our independent registered public accounting firm, as well as our internal controls team – without members of executive management present

LOGO

Board members have complete access to management and employees in their discretion

LOGO


An independent compensation consultant is engaged by and reports directly to our Compensation Committee

​
​

LOGO

​
✓
Board members have complete access to management and employees in their discretion
​

Board and the committees may seek advice from outside advisors

​

LOGO

​

✓
Annual election of directors

​
​

LOGO

​

Review corporate strategic plan at least annually

LOGO

✓
High Board and committee attendance

​
​
​

LOGO

✓
Review and approve Companycorporate strategic plan, including the budget, at least annually

LOGO

​
​

Limits on outside Board and audit committee service

​

LOGO

✓
Robust commitment to corporate, environmental and social responsibility

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✓
Limits on outside board and audit committee service
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​​
✓
Extensive ongoing stockholder outreach, often involving Lead Independent Director
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✓
Proxy access bylaw (3% ownership, 3 years, nominees up to 20% of the Board)
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​​
✓
Audit and Finance Committee is updated by our cybersecurity team at least twice per year
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What We Don’t Do​
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LOGO

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✗
No staggered or classified Board

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LOGO

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✗
No hedging or speculative trading in our stock by directors, executives or other employees

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LOGO

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✗
No plurality voting in uncontested Board elections

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LOGO

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✗
Board members may not be “overboarded”

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    Corporate Governance    

Corporate Responsibility

At Incyte, in addition to our commitment to innovation and the rigorous pursuit of research and development excellence, we are also committed to enhancing the communities in which we operate, improving the treatment and experience of patients, supporting our colleagues and operating our business in a way that protects the environment. For more information, please see “Our Commitment” in the “Our Company” portion of our website athttp://www.incyte.com; however, the information on our website is not part of this proxy statement.

LOGO

PATIENTS

At Incyte, we believe in the power of research to advance scientific innovation and improve patient health and outcomes. Every day we

LOGO

EMPLOYEES

Incyte is committed to promoting a collaborative, safe and innovative work environment at which everyone can contribute to their fullest potential.

are driven to discover and deliver medicines that will positively impact the lives of patients with cancer and other serious diseases.

We support our patients through commitments in four key areas:

•  Patient Safety

•  Scientific Excellence

•  Access to Medicine

•  Patient Education and Awareness

We appreciate, celebrate, and thrive on one another’s differences and strengths. A strong safety culture is a fundamental part of how we work. Our philosophy is that everyone at Incyte has a responsibility to create and maintain a safe and healthy workplace with a goal to reduce risk and prevent injuries.

•  Recognized as the number two employer in the biopharma industry byScience magazine.

•  Specifically recognized by team members for its innovation, work culture and respect for employees.

LOGO

COMMUNITY

Incyte is committed to being an active participant in improving the communities where we live and work.

LOGO

ENVIRONMENT

At Incyte, we seek to operate in a way that reduces our environmental impact. This includes programs for data collection and

Incyte Involved is comprised of three initiatives focused on philanthropy as well as employee and community engagement.

The Incyte Charitable Giving Foundation

•  Includes the Incyte Cancer Care Assistance Fund for Delaware, which provides emergency financial assistance for cancer patients, their caregivers, and family members living in Delaware.

The Community Service Program

•  Incyte colleagues donated over 1,200 hours to working with organizations, including the Food Bank of Delaware and the Salvation Army in 2018.

The Matching Gifts Program

•  In 2018, Incyte matched more than $120,000 donated by our colleagues.

analysis in order to measure and reduce hazardous air emissions, greenhouse gases and water use. In 2019, Incyte launched Greencyte, which is a cross-functional and global team dedicated to seeking ways to minimize our impact on the environment.

United States:

•  All hazardous waste is recycled, reused, fuel-blended or disposed of at an EPA approved facility.

•  Incyte’s Environmental, Health and Safety team works to identify waste minimization and pollution prevention.

Ex-U.S.:

•  Construction of two sites in Switzerland follow strict Swiss regulations regarding environmental protection and energy consumption.

•  Solar panels are being used on both buildings.

Majority Voting Policy

Our Bylaws include a majority voting standard for the election of directors. In order to receive a majority of the votes cast, the number of shares voted “FOR” must exceed the number of votes “AGAINST”; abstentions and brokernon-votes do not count as votes cast. Our Bylaws provide that, in an uncontested election, director nominees must receive a majority of the votes cast to be elected to

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    Corporate Governance    

the Board. Our Corporate Governance Guidelines state that if a nominee for director in an uncontested election does not receive a majority of the votes cast, the director should submit a resignation for consideration by the Board. The Nominating and Corporate Governance Committee will evaluate and make a recommendation to the Board with respect to the proffered resignation. The Board must take action on the recommendation within 90 days following certification of the stockholder vote. The director whose resignation is under consideration cannot participate in any decision regarding his or her resignation. The Nominating and Corporate Governance Committee and the Board may consider any factors they deem relevant in deciding whether to accept a director’s resignation.

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Board Leadership Structure and Role in Risk Oversight

Our current leadership structure and governing documents permit the roles of Chairman and CEO to be filled by the same or different individuals. Where the Chairman and CEO roles are filled by the same individual, our Corporate Governance Guidelines require the independent directors on our Board to appoint a Lead Independent Director.
The Board has currently determinedvalues the flexibility to select, from time to time, a leadership structure that it believes is most able to serve our Company’s and stockholders’ best interests based on the qualifications of individuals available and circumstances existing at the time. As such, the Board periodically evaluates whether combining or separating the roles of Chairman and CEO is in the best interests of our Company and our stockholders.
Currently the Board believes it is in the best interests of our stockholders to have Hervé Hoppenot, our President and CEO, serve as Chairman, coupled with an active Lead Independent Director. As such, Mr. Hoppenot holds the position of Chairman, President and CEO, and Julian C. Baker serves as our Lead Independent Director. Mr. Baker is Baker—a managing member of the general partner of one of our largest stockholder—namely, Bakerstockholders (Baker Bros. Advisors LP and affiliated entities—entities (the “Baker Funds”) who collectively holds 16.1%hold 16.4% of our common stock as of March 12, 2019.April 18, 2022)—serving as our Lead Independent Director. The Board reviews its leadership structure on an ongoing basis and retains the authority to modify this structure as it deems appropriate.

Focus on Independence.   The Board maintains a strong commitment to ensuring Board independence so that it is able to maintain effective oversight of management. The Board’s commitment to independence includes:

✓

Annual appointment of a strong Lead Independent Director, who also represents our largest stockholder, thereby ensuring strong representation of stockholder interests

✓

Robust duties of the Lead Independent Director:

✓

Annual appointment of a strong Lead Independent Director, who also represents one of our largest stockholders, the Baker Funds, thereby ensuring strong representation of stockholder interests
​
✓
Robust duties of the Lead Independent Director, which include:
​
•
presiding at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent directors

​

•
serving as liaison between the ChairmanChairman/CEO and the other independent directors

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•
approving information sent to the Board

​

•
approving meeting agendas for the Board

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•
approving meeting schedules to assure that there is sufficient time for discussion of all agenda items

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•
authority to call meetings and executive sessions of the independent directors

​

•
being available for consultation with stockholders, when appropriate.

✓

Review, at least annually, of the Company’s strategic plan and the following year’s capital and operating budgets

✓

Annual election of all directors, ensuring accountability to stockholders

✓

​
✓
Review, at least annually, of the Company’s strategic plan and the following year’s capital and operating budgets
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✓
Annual election of all directors, ensuring accountability to stockholders
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✓
Regular executive sessions of the independent, non-management directors—without Mr. Hoppenot—to review Company performance, CEO performance, management effectiveness, proposed programs and transactions and the Board meeting agenda items
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✓
Requirement that only independent directors serve on the Audit and Finance Committee, the Compensation Committee and the Nominating and Corporate Governance Committee
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✓
Requirement that a majority of the Board be comprised of independent directors, with 89% of the current Board being independent
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✓
non-management directors—without Mr. Hoppenot—to review Company performance, management effectiveness, proposed programs and transactions and the Board meeting agenda item

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    Corporate Governance    

✓

Requirement that only independent directors serve on the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee

✓

Requirement that a majority of the Board be comprised of independent directors, with 87.5% of the current Board being independent

✓

Corporate Governance Guidelines providing that the Board may have access to Company management and employees and its own advisors, at the Board’s discretion.

Benefits of Combined Leadership Structure.    The Board believes that the Company and our stockholdersBoard may have been best served by having Mr. Hoppenot in the role of Chairman and CEO for the following reasons:

Mr. Hoppenot is most familiar with our business and the unique challenges we face. As such, Mr. Hoppenot is the director best suitedaccess to identify strategic opportunities and focus the activities of the Board. Mr. Hoppenot’sday-to-day insight into our challenges facilitates a timely deliberation by the Board of important matters.

Mr. Hoppenot has and will continue to identify agenda items and lead effective discussions on the important matters affecting us. Mr. Hoppenot’s knowledge and extensive experience regarding our operations and thehighly-regulated industries and markets in which we compete position him to identify and prioritize matters for Board review and deliberation.

As Chairman and CEO, Mr. Hoppenot serves as an important bridge between the Board andCompany management and provides critical leadership for carrying out our strategic initiativesemployees and confronting our challenges. The Board believes that Mr. Hoppenot brings a unique,stockholder-focused insight to assistits own advisors, at the Company to most effectively execute its strategy and business plans to maximize stockholder value.

Board’s discretion.

The strength and effectiveness of the communications between Mr. Hoppenot as our Chairman and Mr. Baker as our Lead Independent Director result in effective Board oversight of the issues, plans and prospects of our Company.

​

This leadership structure provides the Board with more complete and timely information about the Company, a unified structure and consistent leadership direction internally and externally and provides a collaborative and collegial environment for Boarddecision-making.

Flexibility of the Leadership Structure.   The Board is committed to high standards of corporate governance. The Board values itsthe flexibility to select, from time to time, a leadership structure that is most able to serve the Company’s and stockholders’ best interests based on the qualifications of individuals available and circumstances existing at the time. As such, the Board periodically evaluates whether combining or separating the roles of Chairman and CEO is in the best interestsinterest of the Company and of our stockholders.The Board believes that a policy limiting its flexibility to choose, consistent with its fiduciary duties, a leadership structure that will enable the Company to most effectively execute its strategy and business plans to maximize stockholder value would be detrimental to the Company and our stockholders.

Board’s Role in Risk Oversight.   Our Board is responsible for overseeing the overall risk management process at the Company directly and through its committees. The responsibility for managing risk rests with executive
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management while the committees of the Board and the Board as a whole participate in the oversight process. The Board’s risk oversight process builds upon management’s

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    Corporate Governance    

risk assessment and mitigation processes, which include reviews of long term strategic and operational planning, executive evaluation, development and evaluation,succession planning, regulatory and legal compliance, and financial reporting and internal controls. The Board considers strategic and operational risks and opportunities and regularly receives reports from executive management regarding specific aspects of risk management. The Audit and Finance Committee receives periodic reports from executive management with respect to, and reviews such risks associated with, our financial and accounting systems, accounting policies, investment strategies, regulatory compliance and our information systems and technology, including cybersecurity risks and readiness. In addition, the Audit and Finance Committee oversees our internal audit team. The Audit and Finance Committee also meets regularly with our Chief Compliance Officer, our internal controls team and our independent registered public accounting firm in executive session without the presence of other members of management. The Compensation Committee evaluates our compensation policies and practices to help ensure that these policies and practices do not incentivize employees to take unnecessary or excessive risks that are reasonably likely to have a material adverse effect on our Company and provide appropriate incentives for meeting both short-term and long-term objectives and increasing stockholder value over time. The Nominating and Corporate Governance Committee reviews our risks associated with governance matters andnon-compensation related human resources matters.

Director Independence

In 2018,2021, our Board determined that each individual who served as a member of the Board in 2018,2021 except for Mr. Hoppenot, was an “independent director” within the meaning of Rule 5605 of The Nasdaq Stock Market.

Mr. Hoppenot is not considered independent as he is currently employed as our CEO. For Mr. Bienaimé, Mr. Baker, Mr. Brooke, Mr. Clancy, Dr. Dixon, Dr. Fouse and Dr. Friedman,all other directors, the Board considered their relationship and transactions with our Company as directors and security holders of our Company.

All of the nominees are current members of the Board.

Board Evaluation and Refreshment
At least annually, the Board assesses its composition, taking into consideration: the knowledge, experience and diverse perspectives of its directors; each individual director’s performance and contributions to the Board and its committees; the other time commitments of directors; and other factors the Board deems appropriate, such as independence, absence of conflicts and lack of any reputational risks. The Board weighs these factors with Incyte’s priorities and needs. Our directors serve one-year terms, and all continuing directors are subject to our stockholders’ votes every year.
As our Board has done in the past, when it sees a current or future need, it undertakes a thorough search for new directors. In recent years, we have added three new independent directors, with an emphasis on strengthening the Board’s expertise in the areas of drug discovery, clinical development and regulatory, given Incyte’s extensive development portfolio across hematology/oncology and dermatology. Dr. Brawley, an oncologist, joined our Board in September 2021 and brings significant scientific, medical and public health leadership experience. His expertise within hematology and oncology will provide valuable insights into our drug discovery and development efforts, as well as into healthcare delivery.
​​​Relevant Experience​
Director​​
Executive/​
Industry
​​
Drug
Discovery
​​
Clinical
Development
​​Regulatory​​
Business
Development
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Otis W. Brawley, M.D.​​​​✓​​​​​​​​​​​✓​​​​​✓​​​​​​​​
Edmund P. Harrigan, M.D.​​​​✓​​​​​​​​​​​✓​​​​​✓​​​​​✓​​
Katherine A. High, M.D.​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​​​​​​
We believe our Board represents a diverse group of individuals that bring various skills and experience. Our Board’s continuous efforts to refresh itself have led to a complementary mix of new, mid-term and seasoned directors. We believe this group of directors collectively has the skills to support Incyte in the achievement of our long-term goals.
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Matrix of Board Nominees
Expertise​​Hoppenot​​Baker​​Bienaimé​​Brawley​​Clancy​​Fouse​​Harrigan​​High​
Biopharma Industry​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​✓​
Operational Leadership​​​​✓​​​​​​​​​​​✓​​​​​​​​​​​✓​​​​​✓​​​​​✓​​​✓​
International​​​​✓​​​​​​​​​​​✓​​​​​​​​​​​✓​​​​​✓​​​​​✓​​​✓​
Drug Discovery, Development & Regulatory​​​​✓​​​​​​​​​​​✓​​​​​✓​​​​​​​​​​​​​​​​​✓​​​✓​
Commercial​​​​✓​​​​​​​​​​​✓​​​​​​​​​​​​​​​​​✓​​​​​​​​​​​
Financial​​​​✓​​​​​✓​​​​​✓​​​​​​​​​​​✓​​​​​✓​​​​​​​​​​​
Additional Information​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
PhD/MD​​​​​​​​​​​​​​​​​​​​​​✓​​​​​​​​​​​✓​​​​​✓​​​✓​
Attendance​​​​100%​​​​​100%​​​​​93%​​​​​100%​​​​​100%​​​​​100%​​​​​88%​​​100%​
Independence​​​​​​​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​​​✓​​​✓​
We believe having a diverse group of directors with different experiences and skills as well as broad representation benefits the interests of all Incyte stakeholders. Two of our eight Board nominees are women, representing 25% of our Board of Directors. This compares well with the 2021 average among S&P 500 constituents, in which 29% of all Board seats are currently taken by women. Two (25%) of our directors were born in Europe, one self-identifies as Black/African American and one self-identifies as LGBTQ+.
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Overboarding Policy
The Board of Directors recognizes that in order to be effective, each director must be fully engaged. Our Overboarding Policy states that no new director who is a sitting CEO of another public company shall sit on more than one public company board in addition to his or her own board and no new outside director who is not a sitting CEO of another public company may sit on more than four public company boards in total.
In addition, current directors who sit on less than the maximum number of public company boards may not exceed the maximum amount.
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All of our Board nominees are currently compliant with this policy.
​
Hoppenot2
​​Baker​​
Bienaimé2
​​Brawley​​Clancy​​
Fouse2
​​Harrigan​​High​
​2​​3​​2​​4​​4​​2​​3​​2​
​
(1)
Total board commitments includes Incyte
​
(2)
Sitting CEO
​
Further, the level of attendance of our directors at Board meetings continues to be high. The average attendance for 2021 is 98%, with six of the eight directors who are proposed for election in 2022 attending 100% of Board and Committee meetings last year, despite the additional demands placed on all corporate directors in 2021 due to the COVID-19 pandemic.
Director Nominations

The Board nominates directors for election at each annual meeting of stockholders and elects new directors to fill vacancies when they arise. The Board has as an objective, set forth in our Corporate Governance Guidelines, that its membership be composed of experienced and dedicated individuals with diversity of backgrounds, perspectives and skills. The Nominating and Corporate Governance Committee has the responsibility to identify, evaluate, recruit and recommend qualified candidates to the Board for nomination or election.

The Nominating and Corporate Governance Committee will selectseeks candidates for director based on their character,who have substantive knowledge of our business and industry, diverse experiences, proven leadership, sound judgment diversity of experience, business acumen, and ability tointegrity and who can act on behalf of all stockholders. In addition, directors need to be able to foster a respectful environment in which they listen to one another and can hold constructive discussions. The Nominating and Corporate Governance Committee believes that nominees for director should have operational and leadership experience such as experience in management, accounting, finance,well as drug discovery, andclinical development, regulatory, commercial and/or marketing, or industry and technology knowledge,financial experience that may be useful to the Company and the Board;Board. Additionally, prospective directors must demonstrate high personal and professional ethics and the willingness and ability to devote sufficient time to effectively carry out his or hertheir duties as a director. Although the Company has no formal diversity policy for board members, thedirectors. The Board and the Nominating and Corporate Governance Committee also consider diversity of backgrounds and experiences and other forms of diversity when selecting nominees.

20 nominees—to that end, we are proud to have 25% gender diversity among the nominees for election to our Board, in addition to the diverse set of skills and experience the Board collectively represents.| Proxy Statement 2019LOGO

    Corporate Governance    

The Nominating and Corporate Governance Committee believes it appropriate for at least one, and, preferably, multiple, members of the Board to meet the criteria for an “audit committee financial expert” as defined by Securities

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and Exchange Commission rules, and our Corporate Governance Guidelines require that a majority of the members of the Board meet the definition of “independent director” under the rules of The Nasdaq Stock Market. The Nominating and Corporate Governance Committee believes it is appropriate for certain key members of our management — management—currently, our CEO — CEO—to participate as members of the Board.

Prior to each annual meeting of stockholders, the Nominating and Corporate Governance Committee identifies nominees first by evaluating the current directors whose term will expire at the annual meeting and who are willing to continue in service. These candidates are evaluated based on the criteria described above, including as demonstrated by the candidate’s prior service as a director, and the needs of the Board with respect to the particular talents and experience of its directors. In the event that a director does not wish to continue in service, the Nominating and Corporate Governance Committee determines not tore-nominate the director, or if a vacancy is created on the Board as a result of a resignation, an increase in the size of the Board or other event, then the Committee will consider various candidates for Board membership, including those suggested by the Committee members, by other Board members, by any search firm engaged by the Committee and by stockholders. The Committee may only recommend, and the Board may only nominate, candidates for director who agree to tender, promptly following their election orre-election as a director, irrevocable resignations that would be effective if the director fails to receive a sufficient number of votes forre-election at the next annual meeting of stockholders at which he or she facesre-election and if the Board accepts the resignation. The Committee recommended all of the nominees for election included in this Proxy Statement. All of the nominees are current members of the Board.

A stockholder who wishes to suggest a prospective nominee for the Board should notify the Secretary of the Company or any member of the Nominating and Corporate Governance Committee in writing with any supporting material the stockholder considers appropriate. In addition, our Bylaws contain provisions that address the process by which a stockholder may nominate an individual to stand for election to the Board at our annual meeting of stockholders. Our Bylaws permit stockholders to nominate individuals for election to the Board (i) for inclusion in our proxy materials and consideration at an Annual Meeting of Stockholders pursuant to our recently adopted proxy access bylaw and (ii) for consideration at an Annual Meeting of Stockholders without being included in our proxy materials. In order to nominate a candidate for director, a stockholder must give timely notice in writing to the Secretary of the Company and otherwise comply with the provisions of our Bylaws.
Our proxy access bylaw permits an eligible stockholder, or group of up to 20 eligible stockholders, owning continuously for at least three years shares of our common stock representing an aggregate of at least 3% of our outstanding shares, to nominate and include in our proxy materials director nominees constituting up to the greater of two individuals or 20% of the Board, provided that the stockholder(s) and nominee(s) satisfy the requirements specified in the Bylaws (“Proxy Access”). To nominate a director pursuant to Proxy Access, all of the procedures, information requirements, qualifications and conditions set forth in our Bylaws must be complied with. A fully compliant nomination notice must be received by us no earlier than 150 days and no later than 120 days before the anniversary of the date that we issued our proxy statement for the prior year’s annual meeting of stockholders. However, in the event that the annual meeting is called for a date that is more than 30 days before or more than 60 days after the first anniversary date of the preceding year’s annual meeting of stockholders, the nomination notice, to be timely, must be so received by the Secretary of the Company not later than the close of business on the later of (1) the 180th day prior to the date of the meeting and (2) the 10th day following the first public announcement or disclosure of the meeting date.
For a nomination of an individual for election to the Board without being included in our proxy materials, our Bylaws provide that, to be timely, our Secretary must have received the stockholder’s notice not less than 90 days nor more than 120 days prior to the first anniversary of the preceding year’s annual meeting of stockholders. However, in the event that no annual meeting was held in the preceding year or the annual meeting is called for a date that is more than 30 days before or more than 60 days after the first anniversary date of the preceding year’s annual meeting of stockholders, notice by the stockholder to be timely must be so received by the Secretary of the Company not later than the close of business on the later of (1) the 90th day prior to the date of the meeting and (2) the 10th day following the first public announcement or disclosure of the meeting date. Information required by the Bylaws to be in the notice include the name and contact information for the candidate and the person making the nomination and other information about the nominee that must be disclosed in proxy solicitations under Section 14 of the Securities Exchange Act of 1934 and the related rules and regulations under that Section.

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Stockholder nominations must be made in accordance with the procedures outlined in, and include the information required by, our Bylaws and must be addressed to:

Secretary


Incyte Corporation


1801 AugustineCut-Off


Wilmington, DE 19803

You can obtain a copy of the full text of the Bylaw provisionprovisions by writing to the Company’s Secretary at the above address.

Board Meetings

The Board held fivesix meetings during 2018.2021—four regularly scheduled meetings and two other meetings. All directors attended all four regularly scheduled meetings held by the Board. Overall, each director attended at least 88% of the meetings held by the Board and of the committees on which such directorhe or she served during his or her tenure in 2018.

2021.

The independent directors regularly meet in executive sessions at regularly scheduled meetings of the Board without the participation of our CEO or other members of management. There were four regularly scheduled meetings of the Board in 2018.

In 2018, we did not, and for 2019, we

We do not have a policy that requires the attendance of directors at the Annual Meeting.

Corporate Governance Guidelines

The Board is committed to sound and effective corporate governance practices. Accordingly, the Board has adopted Corporate Governance Guidelines, which are intended to describe the governance principles and procedures by which the Board functions. The guidelines are subject to periodic review and update by the Nominating and Corporate Governance Committee and the Board, and were most recently amended in November 2017.February 2022. These Guidelines can be found on our website at http://www.incyte.com under the “Corporate Governance” heading in the “For Investors” portion of our website.

The Corporate Governance Guidelines provide, among other things, that:

•

a majority of the directors must be independent;

​

•
if the Chairman of the Board is not an independent director, the independent directors will appoint a Lead Independent Director, whose duties would include presiding at all meetings of the are described in detail above under “Corporate Governance—Board at which the Chairman is not present, presiding at executive sessions of the independent directors, serving as liaison between the ChairmanLeadership Structure and the independent directors, approving information sent to the board, approving meeting agendas for the Board, approving meeting schedules to assure that there is sufficient discussion time for all agenda items, and being available for consultation with stockholders (when appropriate)Role in Risk Oversight” on page 33;

​

•
directors should offer to resign from the Board if they experience a change in their principal occupation;

​

•
directors should submit their resignations from the Board if they do not receive the votes of a majority of the votes cast in an uncontested election;

directors should advise the chair of the Nominating and Corporate Governance Committee before accepting an invitation to serve on more than four other public company boards (or, if a director is a chief executive officer of a public company, more than two other public company boards);

​

•
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the Audit and Finance, Compensation, and Nominating and Corporate Governance Committees must consist solely of independent directors;

​

•
the Board and its committees may seek advice from outside advisors as appropriate;

​

•
the independent directors regularly meet in executive sessions without the presence of thenon-independent directors or members of our management; and

​

•
the Nominating and Corporate Governance Committee periodically reviews the composition, functioning, skills, diversity, tenure and effectiveness of the Board and its committees, and oversees theself-assessment of the Board and its committees.

​
Leadership Succession Planning
Our executive management team assesses its needs for succession planning at least annually. Incyte maintains a flat organizational structure, and hence Mr. Hoppenot has full exposure to the leaders of each function as well as key individuals within those functions; others in the executive management team are also in a position to provide
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additional insight and context. Should a need arise for succession planning in the executive management team, both internal and external candidates are considered on merit and on Incyte’s current and future goals. Regular succession planning updates are provided to the Nominating and Corporate Governance Committee, which is chaired by our Lead Independent Director, and reported to the full Board by the Nominating and Corporate Governance Committee chair.
Communications with the Board

If you wish to communicate with the Board, you may send your communication in writing to:

Secretary


Incyte Corporation


1801 AugustineCut-Off


Wilmington, DE 19803

You must include your name and address in the written communication and indicate whether you are a stockholder of the Company.

The Secretary will review any communications received from a stockholder and all material communications from stockholders will be forwarded to the appropriate director or directors or Committee of the Board based on the subject matter.

Certain Relationships and Related Transactions

Our policy is that all employees, officers and directors must avoid any activity that is or has the appearance of conflicting with the interests of the Company. This policy is included in our Code of Business Conduct, Ethics and Board Code of Conduct and Ethics. We conduct a review of all related party transactions for potential conflict of interest situations on an ongoing basis and all such transactions must be approved by the Audit and Finance Committee or another independent body of the Board.

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PROPOSAL 2
Advisory Vote to Approve Executive Compensation
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This Proposal 2, commonly known as a ‘say-on-pay’ proposal, provides our stockholders with the opportunity to vote to approve, on a non-binding, advisory basis, the compensation of our named executive officers as disclosed in this Proxy Statement in accordance with the compensation disclosure rules of the Securities and Exchange Commission.
As described in detail under the heading “Executive Compensation—Compensation of Directors

Our directorDiscussion and Analysis,” our executive compensation program isprograms are designed to enable continued attractionattract and retentionretain our named executive officers, who are critical to our success. Under these programs, our named executive officers are rewarded for the achievement of highly qualifiedannual and long-term corporate objectives, and the creation of increased stockholder value. Please read the Compensation Discussion and Analysis for additional details about our executive compensation programs, including information about the 2020 compensation of our named executive officers.

non-employee directors by ensuringEach year since 2011, we sought, and received, approval for our executive compensation program. In addition, in 2011, and again in 2017, we sought, and received, approval to hold a ‘say-on-pay’ vote each year. Accordingly, we are again asking our stockholders to indicate their support for our named executive officer compensation as described in this Proxy Statement. Proposal 2 gives our stockholders the opportunity to express their views on our named executive officers’ compensation. This vote is advisory, which means that our directorthe vote on executive compensation is in line with compensation offered by our peer companies that compete with us for director talent. The program is designed to address the time, effort, expertise, and accountability required of active board membership. Directors who are employees ofnot binding on the Company, do not receive any fees for their service on theour Board or any committee. Mr. Hoppenot is the Company’s only employee director. The Compensation Committee, with the assistance of its independent compensation consultant, periodically reviews the compensation for ournon-employee directors in relation to the peer group used for compensation purposes (as described below under “Compensation Discussion and Analysis”).

In the course of our stockholder engagement during 2018, it became clear that it was time tore-evaluate our director compensation practices. Existing director compensation practices included an equity grant of a fixed number of options. A consensus was forming among several of our stockholders that the equity component of director compensation should, instead, aim to deliver a fixed value. The goal of fixed-value equity compensation is to ensure that overall compensation amounts are generally consistent over time, thus avoiding theup-and-down values that occur when equity compensation grants are fixed to a particular number of stock options. Accordingly, based on the Compensation Committee’s most recent review in September 2018, the Compensation Committee recommended, and, in March 2019,of the Board of Directors approved the changes innon-employee director compensation described below, noting the continued heavy weightingBoard. This vote is not intended to address any specific item of compensation, toward equity and stock options. These changes will take effect uponbut rather the approval of amendments to our Amended and Restated 2010 Stock Incentive Plan (the “2010 Stock Incentive Plan”), as described below under “Proposal 3.”

Cash Compensation

Effective as of the date of stockholder approval of Proposal 3, the amendmentsvote relates to the 2010 Stock Incentive Plan, eachnon-employee director, other than the Lead Independent Director, will receive a $60,000 annual retainer, payable quarterly, and prorated for such portion of the year that the director serves on the Board. The Lead Independent Director will receive a $90,000 annual retainer. The chair of the Audit Committee will receive an additional $25,000 annual retainer, and each other member of the Audit Committee will receive an additional $12,000 annual retainer. The chair of the Compensation Committee will receive an additional $25,000 annual retainer, and each other member of the Compensation Committee will receive an additional $10,000 annual retainer. The chair of the Nominating and Corporate Governance Committee will receive an additional $16,000 annual retainer, and each other member of the Nominating and Corporate Governance Committee will receive an additional $8,000 annual retainer. The chair of the Finance Committee receives an additional $15,000 annual retainer, and each other member of the Finance Committee receives an additional $8,000 annual retainer. All retainers will be prorated for such portion of the year that the director serves on the Board.

Non-employee directors have the option to elect to receive their retainers and committee fees in the form of restricted stock that vests immediately when the associated quarterly retainer amount is paid. All directors are reimbursed for their travel andout-of-pocket expenses in accordance with our travel policy for eachin-person Board or committee meeting that they attend.

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    Compensation of Directors    

Equity Compensation

In addition to cash compensation for services as a member of the Board,non-employee directors also receive equity awards. If our stockholders approve Proposal 3, the 2010 Stock Incentive Plan will be amended to provide that following the conclusion of the Annual Meeting and each future annual meeting of our stockholders, eachnon-employee director who continues to serve as a member of the Board will receive awards with a grant date value of $500,000, of which 75% would be in the form of stock options and 25% would be in the form of restricted stock unit (RSU) awards, determined in the same manner as with awards to ournamed executive officers, as described below under “Compensation Discussion and Analysis.” The exercise pricein this Proxy Statement in accordance with the compensation disclosure rules of the optionsSecurities and Exchange Commission. Accordingly, we again will be equalask our stockholders to vote for the fair market valuefollowing resolution at the annual meeting:

“RESOLVED, that the Company’s stockholders approve, on a non-binding, advisory basis, the date of grant, and the options will have a term of ten years. Each of these options and RSUs will vest in full on the first anniversarycompensation of the date of the grant or, if earlier, the date of the next annual meeting of stockholders or upon a change in control. The initial stock option grants describednamed executive officers, as disclosed in the next paragraph will be eliminated.

Prior toCompany’s Proxy Statement for the date of stockholder approval of Proposal 3, each newnon-employee director appointed to the Board will receive an initial stock option to purchase 25,000 shares of our common stock at an exercise price equal to the fair market value of our common stock on the date of grant. The initial stock option vests and becomes exercisable as to 25% of those shares on the first anniversary of the date of the grant, and the remaining shares vest and become exercisable monthly over the following three years. In addition, on the date of each annual meeting of stockholders, eachnon-employee director who continues to serve as a member of the Board will receive an option to purchase 15,000 shares of our common stock at an exercise price equal to the fair market value of our common stock on the date of grant. Each of these annually granted options will vest in full on the first anniversary of the date of the grant or, if earlier, the date of the next annual meeting of stockholders or upon a change in control.

Under the 2010 Stock Incentive Plan, when a newnon-employee director is appointed to the Board at a time other than at an annual meeting, the director receives a pro rata portion of the automatic annual grants. On May 1, 2018, the date of our 20182022 Annual Meeting of Stockholders each then continuingnon-employee director received his or her annual grant of an option to purchase 15,000 shares of our common stock at an exercise price equalpursuant to the fair market valuecompensation disclosure rules of our common stock on the date of grant.

Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table and the other related tables and disclosure.”
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Executive Compensation
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2021 Financial Performance
2021 was another year of strong performance for Incyte. Product and royalty revenues grew 17% year-over-year to $2.9 billion, driven by growth across all products commercialized by Incyte as well as Incyte products commercialized by our partners. During the year, we achieved 5 regulatory approvals across the U.S., Europe and Japan. These launches are currently underway and are expected to contribute more meaningfully to revenue going forward.
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Revenues of Jakafi® (ruxolitinib), our largest product by net sales, grew 10% to reach $2.1 billion for the year, with new patient starts driving performance across our approved indications in myelofibrosis, polycythemia vera and graft-versus-host disease (GVHD). In the fourth quarter, Jakafi received approval of its fourth indication for the treatment of patients with steroid-refractory chronic GVHD.
Within our hematology and oncology franchise, we further expanded our commercial portfolio with several new approvals, including Pemazyre® (pemigatinib) in cholangiocarcinoma (CCA) in Europe and Japan and Minjuvi® (tafasitamab) in relapsed or refractory diffuse large B-cell lymphoma (DLBCL) in Europe, establishing both as global brands following their U.S. launches in 2020.
An important achievement in 2021 was the approval and launch in October of Opzelura™ (ruxolitinib) cream for atopic dermatitis. Opzelura is a significant future growth driver for Incyte and a cornerstone program for our newly established dermatology franchise. Opzelura is a potent and selective inhibitor of JAK1 and JAK2, designed specifically for topical application. Its unique profile, which positions the product in between other topical therapies and systemic drugs, addresses a significant unmet need in a market where there are millions of patients living with inadequately controlled mild to moderate atopic dermatitis. In the first twelve weeks of commercialization of Opzelura, over 19,000 new patients were treated with Opzelura and we continue to see strong uptake week over week. In addition to atopic dermatitis, we have another substantial opportunity for ruxolitinib cream in vitiligo, a disease that causes loss of skin color in patches and which affects over 1.5 million people in the U.S. Currently, there are no approved therapies for repigmentation.
In addition to our product revenues, we receive royalties on Jakavi® (ruxolitinib) and Tabrecta® (capmatinib), commercialized by Novartis, and on Olumiant® (baricitinib), commercialized by Lilly. Jakavi is indicated for the treatment of patients with myelofibrosis and polycythemia vera and in March 2022, received a positive CHMP opinion for acute and chronic graft-versus-host disease. Tabrecta is approved in the U.S. and Japan for the treatment of patients with metastatic non-small cell lung cancer whose tumors have a mutation that leads to METex14 and in April 2022, received a positive CHMP opinion for the same indication. Olumiant is approved for rheumatoid arthritis (in
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the U.S., Europe and Japan) and atopic dermatitis (in Europe and Japan), and last year, was authorized for use under an Emergency Use Authorization for the treatment of COVID-19. Total royalties grew 45% in 2021 to reach $569 million.
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(1)
Monjuvi revenues recognized by MorphoSys and included in our collaboration loss sharing line item on our consolidated statement of operations for the year ended December 31, 2021.
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(2)
Totals may not add due to rounding.
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2021 and YTD Regulatory and Clinical Achievements
Throughout 2021 and year-to-date, we achieved numerous important milestones. These are summarized in the graphic below and described in more detail thereafter.
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AD = atopic dermatitis; GVHD = graft-versus-host disease; DLBCL = diffuse large B-cell lymphoma; CCA = cholangiocarcinoma; BTC = biliary tract carcinoma; AAD = American Academy of Dermatology; MAA = Marketing Authorization Application; EMA = European Medicines Agency; NSCLC = non-small cell lung cancer.
(1)
Development of axatilimab in collaboration with Syndax Pharmaceuticals
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Myeloproliferative Neoplasms (MPNs) and Graft-Versus-Host Disease (GVHD)
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Jakafi received its fourth approval in steroid-refractory chronic GVHD in September 2021. There are approximately 14,000 patients living with chronic GVHD in the U.S., of which over half require therapy beyond systemic corticosteroids.
Our Leadership In MPNs Beyond Ruxolitinib (LIMBER) program focuses on developing new therapies to improve and expand upon available therapeutic options for patients living with MPNs. Parsaclisib (PI3Kδ) plus ruxolitinib is being evaluated in pivotal trials (1L and inadequate responders), and INCB57643 (BET) and INCB00928 (ALK2) combination trials with ruxolitinib are in proof-of-concept. Once-a-day (QD) ruxolitinib is currently in testing and is expected to be submitted to the FDA for approval in the first half of this year.
In 2021, we entered into a global collaboration with Syndax Pharmaceuticals to clinically develop and commercialize axatilimab, an anti-CSF-1R monoclonal antibody, as a therapy for patients with chronic GVHD as well as in additional immune-mediated diseases where CSF-1R-dependent monocytes and macrophages are believed to contribute to organ fibrosis. We expect to expand development of axatilimab in cGVHD with additional monotherapy and combination trials planned later this year.
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Other Hematology and Oncology
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In 2020, Monjuvi® was approved under accelerated approval by the U.S. FDA based on data, including overall response rate, from the Phase 2 L-MIND study, a single-arm trial of Monjuvi in combination with lenalidomide as a treatment for adult patients with r/r DLBCL. Monjuvi’s launch is ongoing in the U.S. and uptake continues to increase in the second-line DLBCL setting, with continued penetration into new accounts.
In 2021, we received the approval in Europe of Minjuvi® as a treatment for patients with relapsed or refractory DLBCL and we are working to secure reimbursement on a country by country basis.
Updated 3-year L-MIND results were recently presented and demonstrated the potential for long-term disease control and durable responses in patients treated with tafasitamab in combination with lenalidomide followed by tafasitamab monotherapy in patients with r/r DLBCL.
Several trials evaluating tafasitamab in additional indications are currently ongoing, including a Phase 3 trial in first line DLBCL evaluating tafasitamab plus lenalidomide and R-CHOP versus R-CHOP and a Phase 3 trial evaluating tafasitamab plus lenalidomide and rituximab (R-squared) versus R-squared in patients with relapsed or refractory follicular or marginal zone lymphoma.
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Pemazyre is the first targeted therapy approved in the U.S for second-line cholangiocarcinoma and is the market leader. It is the first product to be commercialized by Incyte in multiple geographies following regulatory approvals in Europe and Japan in 2021.
Pemigatinib is currently being evaluated in a pivotal study in first-line cholangiocarcinoma. Additionally, based on findings from our solid tumor-agnostic trial (FIGHT-207) evaluating pemigatinib in patients with driver-alterations of FGF/FGFR, we intend to initiate Phase II studies in glioblastoma (GBM) and non-small cell lung cancer (NSCLC).
Other development highlights within hematology and oncology include:
•
We initiated a Phase 3 study of parsaclisib in warm autoimmune hemolytic anemia (AIHA) based on positive Phase 2 results. There are an estimated 1 in 8,000 people living with warm AIHA in the United States, of which the treatable population is approximately 30%. There are no approved therapies for patients living with this disease.
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•
Our oral PD-L1 program, which includes INCB86550, INCB99280 and INCB99318, was the first to ever demonstrate clinical activity. We expect to make a lead program selection later this year.
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•
Retifanlimab (PD-1) is currently being evaluated in a Phase 3 trial (POD1UM-303) as a treatment for previously treated patients with advanced squamous cell carcinoma of the anal canal (SCAC) who have progressed following standard platinum-based chemotherapy. In addition, retifanlimab is being evaluated as a first line therapy in combination with platinum-based chemotherapy as a treatment for patients with NSCLC.
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Inflammation and AutoImmunity (IAI) / Dermatology
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Opzelura™ (ruxolitinib) cream was launched on October 11, 2021 for mild to moderate atopic dermatitis (AD) and is pending regulatory approval for vitiligo.
We presented positive Phase 3 TRuE-V 24-week results of ruxolitinib cream treatment in patients with vitiligo at the European Academy of Dermatology and Venereology (EADV) last year. Primary and all key secondary endpoints were met and ruxolitinib cream demonstrated significant improvements in facial and total body repigmentation in vitiligo patients. At the 2022 American Academy of Dermatology (AAD) Annual Meeting, we presented new 52-week results from the pivotal program, which demonstrated that a longer duration of therapy with ruxolitinib cream was associated with greater repigmentation. A supplemental new drug application (sNDA) and a marketing authorization application (MAA) for ruxolitinib cream as a treatment for vitiligo are under review at the U.S. FDA and the European Medicines Agency (EMA), respectively. If approved, ruxolitinib cream would become the first product approved for repigmentation in vitiligo and would be a new therapeutic option for the millions of patients living with the disease today.
Further, as we work to maximize the opportunity for the dermatology franchise, we have established a broad clinical development program within dermatology that includes multiple new indications for ruxolitinib cream, as well as new products. Ruxolitinib cream is being evaluated in pediatric atopic dermatitis and in chronic hand eczema, where we are initiating two Phase 3 studies. We are also assessing INCB54707, our JAK1 specific inhibitor, in Phase 2 studies for hidradenitis suppurativa, prurigo nodularis and vitiligo. There is significant potential with each of these indications where there are limited treatment options, or in some cases, no FDA-approved therapies.
Partnered Programs (Incyte is eligible for royalties and milestone payments)
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We participate in multiple collaborative partnerships in which we are eligible for milestone payments and royalties on certain Incyte discovered products that we licensed to third parties. Currently, our key commercialized products include Jakavi® (ruxolitinib) and Tabrecta® (capmatinib), which are licensed to Novartis, and Olumiant® (baricitinib), which is licensed to Eli Lilly and Company.
Ruxolitinib is under review both at the EMA and the Pharmaceuticals and Medical Devices Agency (PMDA) as a treatment for steroid-refractory acute and chronic GVHD in Europe and Japan, respectively. In March 2022, the EMA’s Committee for Medicinal Products for Human Use (CHMP) issued a positive opinion recommending approval of ruxolitinib for the treatment of patients aged 12 and older with steroid-refractory acute graft-versus-host disease or chronic graft-versus-host disease. Capmatinib is under review at the EMA as a treatment for certain patients with NSCLC and in April 2022, the CHMP issued a positive opinion recommending approval of capmatinib for the treatment of adults with metastatic non-small cell lung cancer whose tumors have a mutation that leads to METex14.
During 2021, Lilly announced positive results from two pivotal Phase 3 trials (BRAVE-AA1 and BRAVE-AA2) which found once-daily OLUMIANT® (baricitinib) 4-mg was superior to placebo in achieving significant scalp hair
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regrowth as early as 24 weeks in adults with severe alopecia areata (AA) as defined by ≥50% scalp hair loss at baseline. Lilly has submitted an sNDA, MAA and J-NDA for baricitinib as a treatment for AA in the U.S., Europe and Japan, respectively. There are no approved systemic therapies for AA.
Clinical Development Pipeline
Our pipeline is broad and diverse spanning across multiple mechanisms of action and diseases, all with the same goal of developing therapies that help to address unmet needs of patients and to ultimately be able to make a meaningful difference in the lives of patients and their caregivers. The chart below summarizes our clinical stage programs.
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Discovery Capabilities
Our approach to drug discovery, driven by our core competencies in medicinal chemistry and cellular and translational biology, has enabled us to bring forth numerous drug candidates into clinical development and through regulatory approval. We have established a focused set of drug discovery capabilities in-house, including target validation, high-throughput screening, medicinal chemistry, computational chemistry, pharmacological and translational sciences, ADME (absorption, distribution, metabolism and excretion) and toxicology assessment. We augment these capabilities through a network of collaborations with academic partners and contract research organizations with relevant expertise. In addition to our established small molecules expertise, we have expanded our drug discovery capabilities to include monoclonal antibody discovery in-house and access to bi-specific antibody discovery capabilities.
Our discovery process is target- and pathway-centric and leverages cross-program knowledge to identify and prosecute novel points of synergy, and our areas of focus are primarily in oncology and inflammation and autoimmunity.
Responsiveness to Stockholder Feedback
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Each year, we conduct stockholder outreach to gather direct feedback on our corporate governance, compensation practices and environmental, social and governance (ESG) practices. Since 2018, we have contacted stockholders who represent the top 80% of our shares outstanding.
As a result of our annual stockholder engagement, we have implemented several significant enhancements in our corporate governance, compensation policies, ESG activities and stockholder communication practices. The following changes were made in response to feedback received:
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ANNUAL OUTREACH TO
STOCKHOLDERS:
80%​
OF SHARES OUTSTANDING
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 Action​​Year of Implementation​
Governance​
✓
Adopted a proxy access bylaw
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​​2021​
✓
Adopted equity ownership guidelines
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​​2016, amended 2021​
✓
Adopted a director overboarding policy
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​​2020​
Compensation​
✓
Adjusted the executive compensation pay mix to include higher percentages of Directors    performance shares
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​​Performance Shares added in 2018; increased % of performance shares in 2020 and 2022​
✓
Established a three-year performance period for our CEO and other U.S.-based executive officers
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​​2020​
✓
Restructured director pay to be based on a set target value instead of fixed share grants
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​​2019​
✓
Eliminated special option grants to the CEO
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​​2019​
✓
Added enhanced disclosure on certain items such as goal achievement
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ESG​
✓
Added ESG goals to our Annual Incentive Plan
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​​2022​
✓
Disclosed ethnic and racial diversity data for U.S. workforce
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​​2021​
✓
Enhanced ESG disclosure
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​​2019​

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​Executive Compensation​
Stockholder feedback in 2021 was largely positive, with investors expressing support for the progress Incyte has made in recent years. We believe that our current compensation structure, as described in more detail in subsequent pages of this Proxy Statement, strikes the right balance of motivation and retention for our executives. The tablegraphic below shows the evolution of our executive compensation paid to eachstructure over the last several years.
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non-employee(1) director for his or her service in 2018:


2018 Director Compensation TableNote that long-term compensation vests over 4 years.

  Name  

Fees Earned
or Paid in
Cash

($)

   

Stock

Awards

($)(1)

   

Option

Awards

($)(2)(3)

   

Total

($)

 

Julian C. Baker

   —    76,000    427,371    503,371 

Jean-Jacques Bienaimé

   —    58,000    427,371    485,371 

Paul A. Brooke

   —    95,000    427,371    522,371 

Paul J. Clancy

   70,000    —    427,371    497,371 

Wendy L. Dixon

   —    65,000    427,371    492,371 

Jacqualyn A. Fouse

   —    50,000    427,371    477,371 

Paul A. Friedman

   50,000    —    427,371    477,371 

(1)

Value of restricted stock awards issued at the election of the director in lieu of some of his or her annual retainer and committee fees.

(2)

Amounts listed in this column represent the aggregate grant date fair value of option awards granted in 2018 determined in accordance with the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (ASC 718) for financial reporting purposes. See Note 13 of the Notes to Consolidated Financial Statements in our Annual Report on Form

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10-K for the year ended December 31, 2018 for a discussion of our assumptions in determining the ASC 718 values of our stock awards.

(3)

The following table provides the number of shares of common stock subject to outstanding options held at December 31, 2018 for each director. The number of shares shown for Dr. Friedman includes 107,500 shares underlying options received while he served as our CEO.

Name

Number of Shares

Underlying

Unexercised Options

Julian C. Baker175,000
Jean-Jacques Bienaimé90,000
Paul A. Brooke155,000
Paul J. Clancy90,000
Wendy L. Dixon188,334
Jacqualyn A. Fouse48,750
Paul A. Friedman182,500

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Executive Compensation

Compensation Discussion and Analysis

Below is a comprehensive list of our compensation policies and policy enhancements made in our continuing effort to be responsive to issues discussed during our stockholder outreach and to address advice provided by stockholder advisory firms.
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What We Do​
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LOGO
✓
We pay for performance, including having a total stockholder return (TSR) component for 2021 performance shares
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​LOGO​

✓
We have adopted a compensation clawback policy

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25%

✓
30% of executives’ target equity award value is in the form of performance shares

(and that percentage will increase to 33% for 2022)
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✓
Our Compensation Committee uses an independent compensation consultant, Compensia,

LOGO

We consider and considers peer groups in establishing executive compensation

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Performance shares have a three-year performance period
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We have robust​

✓
Robust anti-hedging andanti-speculation policies in place

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We have implemented robust

✓
Robust stock ownership guidelines for our CEO, executive officers and our directors

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We conduct an annual

say-on-pay✓ vote

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We havedouble-trigger equity vesting in the event of achange-in-control

LOGO


Our Compensation Committee is comprised of all independent directors

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LOGO​
✓
Double-trigger equity vesting in the event of a change-in-control
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✓
We conduct an annual say-on-pay vote
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✓
Equity awards have a minimum vesting period of 12 months.

months with a vesting period over 4 years.
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​LOGO​

✓
We engage proactively with our stockholders throughout the year

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What We Don’t Do​
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✗
We do not reprice stock options without stockholder approval

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We do not provide golden parachute excise taxgross-ups

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We do not providesingle-trigger equity vesting in the event of achange-in-control

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​LOGO​

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We do not provide executiveexcessive perquisites beyond financial and tax planning

for executives
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Compensation Program Strategy and Objectives

The Compensation Committee of our Board believes that the compensation of our executive officers should:

Pay for performance;

Encourage both creation of stockholder value and achievement of strategic corporate objectives;

Integrate compensation with our annual andlong-term corporate objectives and strategy, and focus executive behavior on the fulfillment of both of those objectives;

Provide a competitive total compensation package that enables us to attract and retain, on along-term basis, qualified personnel; and

Provide fair compensation consistent with internal compensation programs.

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    Executive Compensation    

Our executive officers’ compensation currently includes three primary components: base salary, cash bonus, andequity-based incentive awards. Equity-based incentive awards can be made up of restricted stock units, performance shares or stock options. Salary is a fixed amount and does not vary with our performance. All other components of our executives’ compensation are closely tied to our Company’s performance – either through the amounts (if any) of each component actually received or the value of each component over time, or both – and each contributes toward our goal of delivering long-term stockholder value. Each of the equity-based components – including the performance shares that only become earned upon achievement ofpre-determined goals – are also subject to time-based vesting, which the Compensation Committee believes incentivizes executive retention.The performance-based components and time-based components of our equity compensation program are designed to encourage both an appropriate level of risk-taking and a focus on sound long-term decision-making, thus aligning executive interests with the long-term best interests of our Company and our stockholders.

The chart below sets out eachCompensation Committee of these components.

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Fixed Compensation Performance-Based Compensation Short Term Cash Compensation Program Long Term Equity Compensation Program Partially At-Risk Wholly At-Risk Salary Incentive Compensation Program Restricted Stock Units1 Performance Shares Stock Options2 Formour Board believes that the compensation of our executive officers should:

•
Pay for performance;
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•
Encourage both creation of stockholder value and Key Features Provides baseachievement of strategic corporate objectives;
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•
Integrate compensation that is predictable and competitive with our peer group Reflectsannual and long-term corporate objectives and strategy, and focus executive behavior on the scopefulfillment of both of those objectives;
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•
Provide a competitive total compensation package that enables us to attract and complexityretain, on a long-term basis, qualified personnel; and
​
•
Provide fair compensation consistent with internal compensation programs.
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Our executive officers’ compensation currently includes three primary components: base salary, cash bonus, and equity-based incentive awards.
•
Salary is a fixed amount and does not vary with our performance.
​
•
Cash bonus under our annual incentive compensation plan varies with our performance
​
•
Equity-based incentive awards can be made up of executives' roles restricted stock units, performance shares or stock options.
​
All components of our executives’ compensation, other than base salary, are closely tied to our Company’s performance—either through the amounts (if any) of each component actually received or the value of each component over time, or both—and responsibilities Reviewed and approved annually byeach such component of executive compensation contributes toward our goal of delivering long-term stockholder value. Each of the equity-based components—including the performance shares that only become earned upon achievement of pre-determined goals—are also subject to time-based vesting, which the Compensation Committee Annual cash bonus opportunity Percentage of base salary awardedbelieves incentivizes executive retention.
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Below is determined by level of achievement of commercial, R&D and strategic goals Goals approved at the start of each year by thea our 2022 Compensation Committee Achievement percentage determined at the end of each year by the Compensation Committee 25%Matrix:
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​
(1)
Restricted Stock Units comprised 30% of target equity value Value is tied tofor 2021 and will comprise 1/3 for 2022. For a further description of the stock price Vests over four years 25%evolution of the equity compensation program for our executive officers, see “—Our Equity Grant Practices”, starting on page 52.
​
(2)
Performance shares comprised 30% of target equity value Goals approved atfor 2021 and will comprise 1/3 for 2022. For a further description of the startevolution of each year by the Compensation Committee Performance goals align with stockholder interests Only earned if we meet pre-determined performance goals If achieved, value is directly tied to the stock priceVests over four years50%equity compensation program for our executive officers, see “—Our Equity Grant Practices”, starting on page 52.
​
(3)
Stock options comprised 40% of target equity value Value is directly tied tofor 2021 and will comprise 1/3 for 2022. For a further description of the stock price Vests over four years Purpose Rewards current contributions toevolution of the CompanyAttracts and retains high-level talentProvides opportunityequity compensation program for near-term cash bonus basedour executive officers, see “—Our Equity Grant Practices”, starting on the achievement of short-term strategic corporate objectives, which are intended to drive long-term growthSets the stage for potential continued growthProvides opportunity for compensation when stock price is volatileProvides long-term retention of key talentEncourages long-term decision making Aligns management objectives with stockholder interest Provides incentive to achieve key objectives intended to maximize stockholder valueProvides long-term retention of key talentEncourages long-term decision making Aligns management objectives with stockholder interestProvides incentives for strategic risk-taking to maximize value, which correlates to our longer-term R&D plans, and aligns with longer-term stockholder valueProvides long-term retention of key talentEncourages long-term decision makingAligns management objectives with stockholder interest Equity Ownership Guidelines for Executives Help Ensure Continued Alignment with Stockholder Interests Year After Year

1.

Restricted Stock Units were not used as part of the 2018 equity compensation program, but comprise 25% of target equity compensation for 2019. For a further description of the evolution of the equity compensation program from 2018 through 2019, see “-Recent Evaluation of Our Equity Grant Practices”, starting on page 33.

2.

Stock options comprised 75% of target equity compensation for 2018, and now comprise 50% for 2019. For a further description of the evolution of the equity compensation program from 2018 through 2019, see “-Recent Evaluation of Our Equity Grant Practices”, starting on page 33.

page 52.

​
As the design of our executive compensation program shows, the Compensation Committee believes that executive compensation should be designed to pay for performance. Our Company has been very successfulmade great progress in recent years, and executive compensation has reflected that performance. While 2018 was also successful in many respects, we did miss a very important development goal

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CEO Compensation versus Peers
    Executive Compensation    

when ourECHO-301 trial failed, resulting in a lower cash bonus of 81% of target as well as decreased value of equity holdings. In addition, in the case of performance shares which were tied topre-determined, internal, stretch revenue targets, the shares earned amounted to only 83% of target shares. The charts below illustrate how our CEO’s compensation is closely tied to our Company’s performance goals over the last three years and how the percentage of our CEO’s compensation that is tied to performance compares with those of our peer group of companies. The chart below illustrates this evolution with respect to our CEO’sCompensation Committee believes Mr. Hoppenot’s compensation demonstrating that our CEO’s total compensation tracks our achievement of Board-approved corporate goals:

CEO Total Compensation is Linked to Performance

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Total CEO Compensation

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Incentive Compensation Program50

Achievement|

Performance Share Achievement

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in-line with our peer group’s compensation as disclosed in their 2021 proxy statements, with Mr. Hoppenot’s at-risk compensation percentage higher than that of the peer group average.
CEO AT-RISK COMPENSATION IS HIGHER THAN PEER GROUP
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At-RiskAverage peer CEO compensation reflects 2020 compensation from the 2021 proxy statements of the peer group. Compensation is
In-Line with 2019 Peer Group

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Implementing Our Objectives – Objectives—Role of Compensation Committee and Our Chief Executive Officer

The Compensation Committee approves, administers and interprets our executive compensation and benefits policies, including our 2010 Stock Incentive Plan. The Compensation Committee evaluates the performance of our CEO and determines his compensation in light of the goals and objectives of our compensation program. Our CEO and the Compensation Committee together assess the performance of our other executive officers and determine their compensation, based on initial recommendations from our CEO.

Role of the Independent Compensation Consultant

Under its charter, the Compensation Committee has the sole authority to retain any independent compensation consultant or other advisor as the Committee may deem appropriate. Pursuant to this authority, the Compensation Committee has engaged Compensia, a national compensation consulting firm, for support on matters related to the compensation of our executive officers. Compensia does not provide any other services to our Company.

Compensia was retained by the Compensation Committee to prepare compensation analyses for our executive officers and thenon-employee members of our Board of Directors. Specifically, for our executive officers, Compensia was directed to provide a competitive market analysis of the base salary, annual cash incentive awards, andlong-term incentive equity compensation of our executive officers compared against our compensation peer groups and to review other market practices and trends. This market analysis was reviewed with the Compensation Committee in connection with its January 2018early 2021 compensation decisions, and was used to guide decisions regarding base salary adjustments and target annual cash and equity incentive award opportunities. Updated data prepared by Compensia were used to inform the July 2018 equity award decisions made by the Compensation Committee.

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Market Reference Data

While the

The Compensation Committee reviews market benchmarks, it does not necessarily target a specific percentile within our peer group but rather utilizes market reference data to evaluate the competitiveness of our executive officers’ compensation and to determine whether the total compensation paid to each of our named executive
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officers was reasonableis appropriate. When arriving at final compensation decisions, the Compensation Committee considers and assesses factors in addition to market reference data, including individual and company performance, each executive’s role and responsibilities, internal equity, retention requirements and the aggregate.

competitive market, unrealized equity gains, and best compensation governance practices. The Committee does not tie compensation to specified target percentiles. In connection with its analysis for purposes of 20182021 compensation decisions, the Compensation Committee reviewed information prepared by Compensia comparing the compensation for our executive officers with data from SEC filings and the Radford Global Life Sciences Survey for a peer group comprised of 16publicly-traded18 publicly traded biopharmaceutical companies. Where peer data was unavailable, Compensia used survey data from the Mercer SIRS Survey. We collectively refer to thisthese data as the competitive compensation data.

The peer group for 20182021 compensation decisions, referred to as the 20182021 peer group, was chosen based on the following characteristics: major labordirect competitors for talent; comparable business models and capital market competitors,stage; and of broadly similar size in revenue, market capitalization and headcount, and similar product and business models.

and/or headcount.

In September 2018,2021, following discussion by the Compensation Committee, the peer group was changed because one company, Bioverativ, had beento exclude Alexion, Agios and bluebird bio. Alexion was acquired and another company, Tesaro, no longer met ourstopped providing compensation detail in public disclosures. Agios and bluebird bio were undertaking divestiture and spin-off processes, placing these companies below the threshold revenue and market capitalization criteria. Two newrange for the peer group. The other 15 companies that did meet our criteria, Jazz Pharmaceuticals and Neurocrine Biosciences, were added to ourfrom the 2021 peer group were retained, and this new group (referred to replaceas the dropped companies. This updated2022 peer groupgroup) was used for 20192022 compensation decisions and is referred to as the 2019 peer group.

decisions.

The following table sets forth ourshows Incyte versus the 2022 peer group criteriaon 2021 total revenue, total employees, and a comprehensive list of the peer group companies used for 2018 and 2019 compensation decisions:

How We Establish Our Peer Group

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Using recentmarket capitalizations (market cap). All data is as of December 31, 2018, the following tables illustrate Incyte’s twelve trailing months of revenue performance relative to the 2019 peer group and also illustrate our relative headcount and2021.

Company​​
Total
Revenue ($M)
​​Company​​
Total
Employees
​​Company​​
Market
Cap ($M)
​
Gilead​​​​27,305​​​Gilead​​​​14,400​​​Gilead​​​​91,081​​
Regeneron​​​​16,072​​​Regeneron​​​​10,368​​​Regeneron​​​​67,916​​
Biogen​​​​10,982​​​Biogen​​​​9,610​​​Vertex​​​​55,834​​
Vertex​​​​7,574​​​Vertex​​​​3,900​​​Biogen​​​​35,243​​
Jazz​​​​3,094​​​Jazz​​​​3,200​​​SeaGen​​​​28,270​​
Incyte​​​​2,986​​​BioMarin​​​​3,045​​​Alnylam​​​​20,282​​
BioMarin​​​​1,846​​​SeaGen​​​​2,675​​​BioMarin​​​​16,220​​
SeaGen​​​​1,574​​​Alkermes​​​​2,211​​​Incyte​​​​16,213​​
Exelixis​​​​1,435​​​Incyte​​​​2,094​​​Neurocrine​​​​8,080​​
Alkermes​​​​1,174​​​Alnylam​​​​1,665​​​Sarepta​​​​7,841​​
Neurocrine​​​​1,134​​​Exelixis​​​​954​​​Jazz​​​​7,831​​
Alnylam​​​​844​​​Neurocrine​​​​900​​​Exelixis​​​​5,784​​
Ionis​​​​810​​​Sarepta​​​​840​​​Ionis​​​​4,297​​
Sarepta​​​​702​​​Ionis​​​​660​​​Alkermes​​​​3,761​​
Amarin​​​​583​​​Amarin​​​​560​​​Sage​​​​2,506​​
Sage​​​​6​​​Sage​​​​471​​​Amarin​​​​1,337​​
revenue-to-employee ratio compared to the 2019 peer group. We believe this data helps underscore the efficiency of our operations.

2018 Revenue vs. Peers

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Revenue to Employee Ratio vs. Peers

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Recent Evaluation of Our Equity Grant Practices

In July 2016, the Compensation Committee, after consulting with Compensia with respect to peer group practices, revised our equity grant guidelines. In 2016 and 2017, 75% of the value of an executive officer’s annual equity-based incentive awards were in the form of stock options while the remaining 25% were in the form of restricted stock units (RSUs).

In response to stockholder feedback, in 2018, the Compensation Committee changed the RSU portion to performance share awards, which combine the time-based vesting aspects of RSUs with a performance-based vesting requirement, resulting in 75% of the value being in the form of stock options and 25% in performance share awards.

In 2019, the Compensation Committee noted Compensia’s observation that our mix for executives of 75% stock options and 25% performance shares put our executives’ equity-based compensation moreat-risk than our peer group and the broader market norm and that, on average, our peers deliver approximately 25% of executive equity compensation value in the form of time-based vesting RSUs, with approximately 50% being delivered in the form of stock options and approximately 25% being delivered in the form of performance-based shares or options. The Committee also noted that, due to our stock price decline and limited use of RSUs, realizable compensation for our executives for 2016 through 2018 fell well below target compensation values. Accordingly, to enhance executive retention and bring our executive equity compensation practices in line with our peers, the Committee determined that, for 2019, our executives willwould receive 50% of their total grant date target value in the form of stock options, 25% in the form of performance shares, and 25% in the form of RSUs.

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In 2020, the Compensation Committee noted stockholder feedback regarding our performance-based equity awards and determined that, for 2020, our executives will receive 40% of their total grant date target value in the form of stock options, 30% in the form of performance shares, and 30% in the form of RSUs. Those percentages remained the same for 2021. In addition, as discussed below under “Key Elements of Executive Compensation—​Equity Based Incentive Awards,” performance shares granted in 2020 and 2021 would have a three-year performance period.
For 2022, the Compensation Committee determined that our executives will receive 1/3 each of their total grant date target value in the form of stock options, performance shares and RSUs.
While the equity awards are actually granted in July of each year, the Compensation Committee determines the overall equity grant target value for our executive officers in the early portion of the year, in conjunction with the determination of base salary adjustments and the establishment of the annual incentive compensation plan described in greater detail below. Based on those target values, the share numbers of our annual stock option grants are determined in the middle of each calendar year, withone-half of the grants made at that time andone-half made at the beginning of the following calendar year, with a view toward countering some of the effects of the volatile trading price of our common stock.
Our annual stock option grants have aten-year term with four-yearservice-based vesting withone-quarter vesting after one year and the remainder vesting in 36 equal monthly installments. Our annual executive performance share and RSU awards are made in the middle of each calendar year. The
In 2020, three-year performance periods were introduced for performance share awards, and these performance share awards vest, assuming performance goals are achieved at specified levels, in equal annual installments over four yearsat the conclusion of the performance period, and are described further below. The RSU awards vest in equal installments on each of the first four anniversaries of the grant date.

The Compensation Committee also has the discretion to make outstanding merit stock option awards, which havefor 2019 were stock options with aten-year term that vest in a single installment after four years and starting in 2020 were RSUs that vest in a single installment after four years. ThoseThe change from stock options to RSUs was due to the significant volatility of our share price and the share prices of our peers, to provide greater certainty for the retentive value of these awards, if granted,granted. These awards can be made to executives other than our CEO as well as other key employees throughout our Company and are typically made in connection with salary adjustments at the beginning of each year as the awards are intended to relate toaward prior year performance and to incentivize and retain the recipients. Our CEO championed the creation of the outstanding merit grant program to recognize important contributions – contributions—both within a function and the Company as a whole - whole—by leaders throughout our organization. Previously, our CEO received these grants too, but, starting in 2019, in response to stockholder feedback, the Compensation Committee eliminated awards of outstanding merit grants to our CEO.

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In addition, as described below, in June 2018,November 2021, the Compensation Committee made retention planapproved equity awards to certain key R&D and salesforce employees, including the grant of performance share awards to certainour executive officers (not including our CEO).

with 50% of the approval date target value in the form of performance shares granted on December 1, 2021 and the remaining 50% of the approval date target value in the form of RSUs granted on January 1, 2022. As a result of these retention awards, no outstanding merit awards were made to any executive officer in January 2022 for prior year performance.

The exercise price of each stock option awarded under our 2010 Stock Incentive Plan is the closing price of our common stock on the date of grant, which for our annual stock option grants are the dates of the regularly scheduled Compensation Committee meetings or actions without meetings, which are taken following decisions at meetings, in the middle of the year at which equity awards for senior executives are formally determined and at the beginning of the year at which salary adjustments and cash bonuses under our incentive compensation plan are determined. These meetings are scheduled in advance, and we do not coordinate the timing of equity award grants with the release of financial results or other material announcements by our Company. Under our 2010 Stock Incentive Plan, we may not reprice or replace options at lower exercise prices without stockholder approval.

Compensation Practices and Policies

Equity Ownership Guidelines.   Effective January 1, 2016, our Board adopted robust equity ownership guidelines for members of senior management, including our executive officers, and members of the Board. The guidelines
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were amended and restated in November 2021 to narrow the types of securities that would count toward the ownership requirements. Under these guidelines, the covered individuals are expected to meet the following equity ownership requirements:

​
Equity Ownership Requirements​

CEO

​		CEO​​6x Annual Base Salary​

​

All Other Executive Officers

​​3x Annual Base Salary​

​

Non-Employee Members of the Board

​​6x Annual Cash Retainer​

Our CEO has met this requirement.
All other directors and executive officers have either met their respective equity ownership targets or are within the five-year period for achieving compliance.

Covered individuals as of January 1, 2016 must satisfyhave satisfied these guidelines by December 31, 2020, and individuals who subsequently become subject to the guidelines will have five years to reach their ownership requirements. Shares held directly, shares held indirectly, such as by a trust or a 401(k) plan, unvested restricted shares and RSUs, and earned performance shares underlying vested stock optionsthat remain subject to service-based vesting requirements are included in determining an individual’s equity ownership. Unvested stockStock options (whether vested or unvested) and unearned performance shares are not counted toward meeting these guidelines.

Prior to the 2021 guideline amendments, shares underlying vested stock options were included in determining equity ownership. For purposes of these guidelines, a non-employee director’s annual cash retainer does not include cash retainers for committee service.

Compensation Recovery Policy.   In late 2017, in response to our 2017 stockholder engagement campaign (described more fully under “Stockholder Engagement” starting on page 6)12), our Compensation Committee adopted a compensation recovery (“clawback”) policy which provides that, in the event that, on account of fraud or other intentional misconduct, we are required to prepare an accounting restatement, we may recover from any executive officer any incentive compensation erroneously paid or awarded in excess of what would have been paid under the accounting restatement. This policy applies prospectively to certain incentive compensation paid or awarded after January 1, 2018, its effective date, and covers thethree-year period preceding the date on which we are required to prepare the accounting restatement. The incentive compensation to which it applies is cash bonuses or other cash awards to the extent those bonuses or awards are earned based on the attainment of a financial reporting measure presented in our financial statements or derived from our accounting

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records. In addition, we are subject to the provisions of Section 304 of theSarbanes-Oxley Act of 2002, which provides that if we are required as a result of misconduct to restate our financial results due to our material noncompliance with any financial reporting requirements under the federal securities laws, our CEO and Chief Financial OfficerCFO may be legally required to reimburse us for any bonus or otherincentive-based orequity-based compensation they receive. To the extent our policy is inconsistent with any final regulations adopted by the SEC to implement the requirements of theDodd-Frank Wall Street Reform and Consumer Protection Act, we intend to revise our policy to comply with those regulations.

Limitations on Hedging and Pledging.   Under our insider trading policy, our employees, including our executive officers, and Board members are prohibited from trading in our securities on ashort-term basis, purchasing our securities on margin, making short sales in our securities, buying or selling put or call options on our stock, pledging our securities as collateral for a loan, and engaging in other hedging or monetization transactions such as prepaid variable forwards, equity swaps, collars and exchange funds, that permit a holder to continue to own our securities but, without the full risks and rewards of ownership.

Effects of Stockholder Advisory Vote on Executive Compensation, Stockholder Engagement

Approximately 72% of the votes cast in the stockholder advisory “say on pay” vote on executive compensation in 2018 approved our executive compensation described in last year’s proxy statement. Throughout the 2018 proxy season, we engaged directly or indirectly through our proxy solicitor, D. F. King & Co., with investors across the vast majority of our stockholder base, representing over 80% of our outstanding shares at that time, including our top ten stockholders. The Compensation Committee considered the result of the stockholder advisory vote as generally strong support for its overall compensation policies, practices and philosophy for our executive officers while also clearly understanding the perspective from several of our stockholders that some change was needed. Accordingly, as a result of this valuable stockholder feedback, the Compensation Committee eliminated the practice of granting special option grants (now called outstanding merit option grants) to our CEO on an ad hoc basis.

Whilesay-on-pay votes are a key indicator of stockholder feedback, we are committed to keeping an open dialogue with our stockholders, including our institutional investors, throughout the year, not just during proxy season. We regularly and frequently engage with our stockholders to discuss business topics, seek feedback on our performance and address other matters of importance to our stockholders, such as executive compensation and corporate governance. Even though our 2017say-on-pay vote resulted in nearly unanimous approval of our compensation practices, our 2017 stockholder engagement campaign (described more fully under “Stockholder Engagement” on page 6) made clear that a persistent stockholder concern was that our executive compensation program did not include anyperformance-based shares tied to financial metrics. As a result, and as described elsewhere in this proxy statement, the Compensation Committee included performance shares tied topre-specified performance goals (which wererevenue-based for 2018) starting with the equity grant cycle in July 2018. These performance share awards comprised 25% of each executive officer’s target equity award value for 2018 and 2019.

The Compensation Committee intends to continue to regularly review, assess and, when appropriate, adjust our compensation practices based on feedback from our stockholders or other determinations informed by best practices and trends.

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Tax Deductibility of Compensation

Section 162(m) of the Internal Revenue Code places a limit of $1,000,000 on the amount of compensation that we may deduct in any one year with respect to our CEO and each of the next three most highly compensated executive officers (excluding the chief financial officer for taxable years prior to 2018). Section 162(m) historically permitted deductions in excess of $1,000,000 for“performance-based “performance-based compensation,” which included stock options meeting certain requirements, but the exception for“performance-based “performance-based compensation” has been repealed effective for taxable years beginning after December 31, 2017.

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Stock options that we granted in 2017 and prior years should still qualify for full deductibility under a transition rule for amounts payable pursuant to written binding contracts in effect on November 2, 2017. To maintain flexibility in compensating our executive officers, the Compensation Committee has not adopted a policy requiring all executive compensation to be deductible.

Key Elements of Executive Compensation

Our executive officers’ compensation currently includes three primary components: base salary, cash bonus, and long-termequity-based incentive awards. Of these components, only base salary is not tied directly and meaningfully to our Company’s performance because base salary is intended to attract and retain key talent by providing a stable source of income. In addition, we provide our executive officers a variety of benefits that are available generally to all salaried employees. Each of these components is described in more detail below.

Base Salary

Base salaries are designed to attract and retain qualified personnel by providing a consistent cash flow throughout the year as compensation for acceptable levels of performance ofday-to-day responsibilities. Base salaries for our executive officers are established based on the scope of their responsibilities, their performance, and their prior relevant background, training and experience, taking into account competitive market compensation paid by the companies represented in the compensation data we review for similar positions and the overall market demand for those executive officers at the time of hire. The Compensation Committee reviews salaries on an annual basis. At such time, the Compensation Committee may change each executive officer’s salary based on the individual’s contributions and responsibilities over the prior twelve months and any change in competitive market pay levels.

In January 2018,2021, the Compensation Committee set the 20182021 base salaries for our executive officers. The Committee considered our Company’s performance in 2017,2020, including our commercial operations, clinical trial progress of our other drug candidates, job performance, internal pay alignment and equity, marketplace competitiveness and the 20182021 peer group data in determining the base salaries for 2018.

2021.

In January 2019,2022, the Compensation Committee set the 20192022 base salaries for our executive officers. The Committee considered our Company’s performance in 2018,2021, including our commercial operations, clinical trial progress of our other drug candidates, job performance, internal pay alignment and equity, marketplace competitiveness and the 20192022 peer group data in determining the base

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salaries for 2019.2022. The following table sets forth the salary history ofincreases that became effective on February 1, 2022 for our named executive officers listed in the Summary Compensation Table and for Christiana Stamoulis, our new Chief Financial Officer.

  Name  

2016

Base Salary

   

2017

Increase

  

2017

Base Salary

   

2018

Increase

  

2018

Base Salary

   

2019

Increase

  

2019

Base Salary

 

Hervé Hoppenot

  $940,000    3.0%  $968,200    3.0%  $997,246    5.0%  $1,047,108 

Christiana Stamoulis (1)

   —    —   —    —   —    —  $560,000 

David Gryska (2)

  $553,805    3.0%  $570,419    3.0%  $587,532    —   — 

Reid Huber (3)

  $480,000    3.0%  $494,400    3.0%  $509,232    —   — 

Steven Stein

  $442,900    7.3%  $475,000    10.5%  $525,000    5.0%  $551,250 

Wenqing Yao

  $430,000    4.7%  $450,000    3.0%  $463,500    5.0%  $486,675 

Maria Pasquale (4)

   —    —   —    —  $500,000    3.0%  $515,000 

(1)

Ms. Stamoulis joined us as our Executive Vice President and Chief Financial Officer effective February 2019.

(2)

Mr. Gryska resigned as Executive Vice President and Chief Financial Officer effective December 2018.

(3)

Dr. Huber resigned as Executive Vice President and Chief Scientific Officer effective November 2018.

(4)

Ms. Pasquale was appointed Executive Vice President and General Counsel effective April 2018.

For each of 2018 and 2019, 3.0% was the average base salary increase for all of ournon-executiveTable. employees.

Name​​
2021
Base Salary
​​
2022
Increase
​​
2022
Base Salary
​
Hervé Hoppenot​​​$1,143,444​​​​​8.0%​​​​$1,234,920​​
Christiana Stamoulis​​​$605,640​​​​​8.0%​​​​$654,092​​
Steven H. Stein​​​$636,695​​​​​18.0%​​​​$751,301​​
Barry P. Flannelly​​​$530,882​​​​​8.0%​​​​$573,353​​
Maria E. Pasquale​​​$546,364​​​​​8.0%​​​​$590,074​​
Annual Incentive Compensation Plan

Each year, we have established an incentive compensation plan that provides for cash incentive awards for all of our eligible employees. The plans have been designed to pay for performance by aligning incentive awards for each participant with an evaluation of our achievement of corporate objectives. These corporate objectives are approved by the independent members of our Board based on the recommendations of the Compensation Committee, as well as, in the case of individuals other than our CEO, the achievement of individual business objectives for a particular year. Eligibility to participate in the plans and actual award amounts are not guaranteed and are determined, in the case of our executive officers, at the discretion of the Compensation Committee. After the completion of each year, the Compensation Committee reviews with our CEO the level of achievement of the corporate objectives under the plan and determines the size of the overall bonus pool to be used for awards. The Compensation Committee, with input from our CEO with respect to our other executive officers, may use discretion in determining for each executive officer his or her bonus amount.

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Incentive awards for our executive officers were approved by the Compensation Committee and paid in 20192022 pursuant to our 20182021 incentive compensation plan. Each of our executive officers, who was with us for all of 2018, other than our CEO, had a funding target under the plan of 50% of his or her annual base salary for 2018,2021, with the potential for actual awards under the plan to either exceed or be less than the funding target depending upon corporate performance, as well as the executive officer’s achievement of certain individual goals that are predetermined by our CEO. Our CEO had a funding target under the plan of 100% of his annual base salary for 2018,2021, with the potential for actual awards under the plan to either exceed or be less than such funding target depending upon corporate performance.
Target incentive award amounts for each participant were based on the participant’s potential impact on our operating and financial results and on market competitive pay practices. Individual performance goals were also established for eligible employees other than our CEO, and evaluations were based upon whether the employee met, exceeded or did not meet each established goal. The Committee believes that it is appropriate to align a higher percentage of our executive officers’ total cash compensation with the achievement of ourBoard-approved corporate objectives because those objectives are determined with a view toward progressing our Company’s business and

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maximizing stockholder value. Linking a significant percentage of executive officer cash incentive awards to achievement ofCommittee-approved corporate objectives puts a substantial portion of our CEO’s and executive officers’ cash compensation at risk, and is another way the Committee has designed executive compensation to pay for performance.

While executive officers other than our CEO have individual performance objectives that are evaluated by our CEO, the outcome of those objectives did not affect awards under our 20182021 incentive compensation plan to those officers, and the award amounts were based solely on achievement of the corporate performance objectives.

Annual Incentive Compensation Plan

2018 2021 Corporate Performance Objectives

Corporate performance objectives for 20182021 were based on achievement of drugthe objectives in the following categories: discovery, objectives, drugclinical development and global commercial, with business development objectives commercial objectives, finance objectives, and technical operations objectives.

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providing additional bonus opportunities.

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Threshold, target and outperform achievement levels arewere defined for each corporate objective and, depending on the achievement of those performance levels, a payout ranging from 0% to 150% may behave been made for each core objective. TheECHO-301 component of our drug development objectives was only achievable at the outperform level and related to achieving data sufficient for a regulatory submission. Bonus objectives included an extra 5%20% for drug discovery,Discovery, an extra 25%20% for drug development, andClinical Development, an extra 5% for business development.Global Commercial and an extra 10% for Business Development. Collectively, the bonus opportunities enabled the payout of up to an additional 3555 percentage points for extraordinary achievements beyond core objectives.

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    Executive Compensation    

At the time the corporate performance objectives for 20182021 were set, the Compensation Committee and management believed that achievement of the target levels of performance for thenon-ECHO-301 objectives would be difficultchallenging and challenging, but achievable withwould require significant effort and skill, favorablepositive preclinical study and clinical trial results and continued strong commercial performance. As noted above, achievement of theECHO-301 component of our drug development objectives were dependent on clinical trial results.

In January 2019,2022, the Compensation Committee evaluated the achievement of the 20182021 corporate performance objectives and determined that incentive awards under our 20182021 incentive compensation plan should be based upon an achievement score of 81%101.5% of the target level of corporate performance objectives. While the Committee noted that the business development bonus opportunity relating to the establishment of a strategic relationship that provides near-term sales revenues was not met, the Committee determined that our establishment of our strategic collaboration in China with Innovent warranted the award of two percentage points. The various objective categories, target payouts and actual payouts, are listed in the table below.

Objectives  Target %     Payout %   

Drug Discovery

  15   22.5 
LOGO Achieved IND filings for INCAGN2385, INCAGN2390, and INCB86550  
LOGO Achievedpre-clinical objectives relating to certain programs  
    Bonus Achieved  —   5 
LOGO Achieved four objectives, including filing an IND for INCB86550  

Drug Development

  60   30 
    JAK Programs  5   5 
LOGO Submitted sNDA for ruxolitinib in steroid-refractory acute GVHD  
LOGO Completed enrollment targets forpre-specified trials, includingGRAVITAS-301  
    Immune Therapies – Large Molecule  5   7.5 
LOGO Achieved five of six objectives, including initiating three monotherapy clinical trials with registrational intent for INCMGA0012  
    Immune Therapies – Small Molecule  5   5 
LOGO Achieved three of five objectives, including opening enrollment for the first clinical trial of INCB86550  
    Epacadostat  35   — 

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 Did not achieve sufficient pivotal data fromECHO-301 to trigger a decision to submit to regulatory authorities  
LOGO Did not complete enrollment in other pivotal epacadostat trials  
    Targeted Therapies  5   — 
LOGO Only achieved four of eleven objectives, including opening enrollment for the Phase III study of pemigatinib in first-line cholangiocarcinoma  
    Bonus Achieved  —   5 
LOGO Reported preliminary data for pemigatinib in second-line FGFR2 translocated cholangiocarcinoma which, if confirmed in the full cohort, would support an NDA submission  
    Inflammation/Autoimmunity  5   7.5 
LOGO Achieved four out of five objectives, including the initiation of the Phase III trial of ruxolitinib cream in atopic dermatitis as well as trials with INCB54707 and parsaclisib inpre-specified indications  

Commercial

  25   21 
LOGO Achievedpre-specified level of revenue for Jakafi and Iclusig  
Business Development Bonus Achieved  —   2 
LOGO Achievedout-licensing collaboration that provides potential for royalties by 2021  

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The

Objectives​​Target %​​Payout %​
Discovery
✓
Achieve the requisite number of pre-specified goals to outperform, including 3 IND filings
​
​​20​​26.25​
Clinical Development​​50​​41.25​
Hematology and Oncology
✓
Obtain approval in the U.S. for Jakafi in steroid-refractory chronic GVHD
​
✓
Advance multiple programs within MPNs/GVHD, including once-a-day (QD) ruxolitinib and the initiation of combination trials by a specific time
​
✓
Advance multiple clinical research and early development programs within other hematology and oncology
​
✓
Obtain approval in the U.S. for retifanlimab in squamous cell carcinoma of the anal canal
​
✓
Regulatory submissions for approval for various assets by a specific time
​
✓
Enhance manufacturing capabilities to support expanding portfolio
​
​​40​​30​
Inflammation and AutoImmunity (IAI)
✓
Obtain approval in the U.S. for Opzelura in atopic dermatitis
​
✓
Submit U.S. sNDA for ruxolitinib cream in vitiligo by a specified time
​
✓
Submit EU MAA for ruxolitinib cream in vitiligo by a specified time
​
✓
Advance clinical development programs within inflammation and autoimmunity
​
​​10​​11.25​
Development Bonus Opportunities
✓
Obtain approval in Europe or Japan for pemigatinib in cholangiocarcinoma or biliary tract carcinoma, respectively
​
✓
File parsaclisib in NHL for approval in Europe or Japan
​
✓
Obtain approval in Europe for tafasitamab in r/r DLBCL
​
​​​​​15​
Global Commercial
✓
Achieve net product sales targets
​
✓
Successful U.S. launch of Opzelura in atopic dermatitis
​
​​30​​29​
Business Development Bonus
✓
Bring in complementary and/or supplemental assets with the potential to provide near to mid-term sales revenues and meaningful revenue growth in the 2025+ timeframe or a clinical stage asset that advances the LIMBER initiative
​
​​​​​5​
Total​​100​​101.5​
Detailed Discussion on Performance Objectives and Achievements
Discovery
In 2021, we achieved almost all pre-specified discovery goals, which spanned our small molecule and biologics programs. While we do not disclose many details about our discovery efforts due to potential competitive concerns, our efforts resulted in three Investigational New Drug (IND) applications, including our CDK2 inhibitor and CD73 monoclonal antibody, as well as the selection of numerous nomination and back-up compounds.
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Clinical Development
Throughout 2021, we made significant progress in advancing our clinical pipeline across hematology/oncology and IAI. While not every goal we set for ourselves was achieved, the year brought numerous development successes, some highlights of which are listed below.
Hematology and Oncology
We continued to expand within MPNs/GVHD and make progress within our LIMBER (Leadership in MPNs Beyond Ruxolitinib) program, a key priority for Incyte. Jakafi® received FDA approval of its fourth indication as a treatment for steroid-refractory chronic GVHD. Additionally, we advanced our once-a-day ruxolitinib formulation to support an NDA submission in H1 2022. We also initiated a combination trial of ruxolitinib + INCB00928, our ALK2 inhibitor, by a specific time. Within GVHD, we were able to achieve decision-enabling results for itacitinib from the dose-finding phase of the 1L chronic GVHD trial by a specific time.
Additionally, we achieved a bonus opportunity for Pemazyre® with the approval in Europe for cholangiocarcinoma and in Japan for biliary tract carcinoma. We also completed enrollment of the pemigatinib tumor agnostic study by a specific time.
Within our immuno-oncology (I/O) portfolio, we are developing a series of oral PD-L1 inhibitors as well as an injectable PD-1 therapy. We are also advancing our adenosine program which includes INCB106385, a dual antagonist of A2A/A2B receptors, and INCA00186, an anti-CD73 monoclonal antibody. We initiated a clinical study evaluating our anti-CD73 mAb by a specific time.
Finally, we achieved a bonus opportunity with the approval of Minjuvi® in Europe for r/r DLBCL and a regulatory submission goal for parsaclisib.
Inflammation and AutoImmunity (IAI)
In 2021, we achieved multiple successes within our IAI development program, which encompasses both dermatology and other inflammatory and autoimmune conditions.
A key goal was achieved with the approval of Opzelura® in the U.S. for atopic dermatitis. In addition, we submitted to the FDA an sNDA in vitiligo by a specified time and we also submitted to the EMA an MAA in vitiligo by a specified time.
We are also evaluating parsaclisib, our PI3Kδ inhibitor, in patients with warm autoimmune hemolytic anemia and were able to achieve health authority agreement on registration path in the indication by a specified time.
Global Commercial
Our oncology net product sales goal includes total net revenues from Jakafi® (ruxolitinib), Iclusig® (ponatinib), Pemazyre® (pemigatinib) and Monjuvi®/Minjuvi® (tafasitamab-cxix). Total combined oncology net product sales reached $2,396.4 million [includes Monjuvi U.S. sales as recorded by our partner MorphoSys], representing 15% year-over-year growth, which exceeded our threshold of $2,310.5 million and fell short of our target of $2,519.0 million. Additionally, we successfully launched our first dermatology product, Opzelura, with over 20,000 new-to-brand prescriptions in the fourth quarter which surpassed our target of 15,000 new-to-brand prescriptions.
Business Development Bonus
We advanced our LIMBER initiative by entering into an exclusive worldwide collaboration and license agreement to develop and commercialize axatilimab, an anti-CSF-1R monoclonal antibody, currently being evaluated as a monotherapy agent in patients with chronic GVHD in a pivotal phase 2 trial.
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Incentive Awards for Named Executive Officers
This table below sets forth the incentive awards under our 20182021 incentive compensation plan for our named executive officers:

 Name  

Year-End
Salary

(A) x

   Target
Bonus %
(B) x		  Overall
Multiplier
(C) =		  

Bonus
Award

(D)

 

 Hervé Hoppenot

  $997,246    100%   81.0%  $807,769 

 David W. Gryska (1)

  $587,532    50%   81.0%  $237,551 

 Reid M. Huber (2)

   —    —   —   — 

 Steven H. Stein

  $525,000    50%   81.0%  $212,625 

 Wenqing Yao

  $463,500    50%   81.0%  $187,718 

 Maria E. Pasquale (3)

  $  500,000    —   —  $  250,000 
(1)

Mr. Gryska resigned as Executive Vice President and Chief Financial Officer effective December 2018.

(2)

Dr. Huber resigned as Executive Vice President and Chief Scientific Officer effective November 2018.

(3)

Ms. Pasquale was appointed Executive Vice President and General Counsel effective April 2018. Her bonus award for 2018 was contractually agreed, independent of our corporate achievement factor.

Name​​
Year-End
Salary
(A) x
​​
Target
Bonus
(B) x
​​
Overall
Multiplier
(C) =
​​
Bonus
Award
(D)
​
Hervé Hoppenot​​​$1,143,444​​​​​100%​​​​​101.5%​​​​$1,160,596​​
Christiana Stamoulis​​​$605,640​​​​​50%​​​​​101.5%​​​​$307,363​​
Steven H. Stein​​​$636,695​​​​​50%​​​​​101.5%​​​​$323,123​​
Barry P. Flannelly​​​$530,882​​​​​50%​​​​​101.5%​​​​$269,423​​
Maria E. Pasquale​​​$546,364​​​​​50%​​​​​101.5%​​​​$277,280​​
Our incentive compensation program is designed to incentivize employees, including our executive officers, in every area of our Company, which we believe helps lead to significant achievement across all areas. Our Compensation Committee believes that measuring and rewarding achievements from all functions — functions—including functions such as discovery, development, technical operations and business development, whose efforts take a much longer time to make an impact on ourtop-line revenue or on our stock price — price—helps ensure that we are properly incentivizing the collective efforts that lead not only to successful current commercial performance but also critically set the stage for potential continued growth and potentiallong-term sustained success in the years ahead. Our Compensation Committee also believes that linking incentive compensation to corporate goals aligns employees’ incentives with strategic imperatives, thus paying for performance.

The chart below illustrates the achievement levels under our incentive compensation program over the last three years, and illustrates how the annual incentive compensation plan serves to execute on the Compensation Committee’s goal of paying for performance:

Incentive Compensation Plan Achievement —2016-2018Achievement—2019-2021

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Annual Incentive Compensation Plan

2019 2022 Corporate Performance Objectives

In January 2019,March 2022, the independent members of our Board, based on the recommendations of the Compensation Committee, approved corporate objectives for our 20192022 incentive compensation plan. Under this plan, the funding targets for our CEO was increased to 110% of base salary and the funding targets for our other executive officers remain the same as for 2018.range from 50% to 60% of base salary. Corporate performance objectives for 20192022 are based on achievement of drug discoveryDiscovery, Clinical Development and Global Commercial objectives drug developmentas well as ESG objectives and commercial objectives.

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Threshold, target and outperform achievement levels are defined for each corporate objective and, depending on the achievement of those performance levels, a payout ranging from 0% to 150% may be made for each objective. Bonus objectives include an extra 5%20% for Drug Discovery, an extra 20% for DrugClinical Development and an extra 10%5% for Business Development. Collectively, the bonus opportunities enable the payout of up to an additional 3545 percentage points for extraordinary achievements beyond core objectives.

The Committee and management believe that achievement of the target levels of performance will be difficult and challenging, but achievable with significant effort and skill, favorable preclinical study and clinical trial results and continued strong commercial performance.

Equity-Based Incentive Awards

The Compensation Committee administersequity-based incentive awards, such as stock option grants, RSUs and performance shares that are made to our executive officers under our 2010 Stock Incentive Plan. The Compensation Committee believes that by providing those persons who have substantial responsibility for our management and growth with an opportunity to increase their ownership of our stock, the best interests of our stockholders and executive officers will be closely aligned. Therefore, executive officers are eligible to receiveequity-based incentive awards when the Compensation Committee performs its annual review, although these awards may be granted at other times in recognition of exceptional achievements. As is the case when the amounts of base salary and initial equity awards are determined, the Compensation Committee conducts a review of all components

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of an executive officer’s compensation when determining annual equity awards to ensure that the executive’s total compensation conforms to our overall philosophy and objectives.

Under our 2010 Stock Incentive Plan, we may grant stock options, restricted shares, performance shares, RSUs or stock appreciation rights.

In 2018,2021, our U.S.-based executive officers received stock options, and performance shares and RSUs and our non-U.S.-based executives officers received RSUs for 2019, ourtheir annual equity awards. The award vehicles will remain the same in 2022. Our CEO received annual equity awards in 2021 with a total grant date target value of $12,400,000 and will be receiving annual equity awards in 2022 with a total target grant value of $13,400,000. For other executive officers, the total grant date target values of their annual equity awards in 2021 ranged between $500,000 to $2,200,000. For 2022, these will receive stock options, performance shares, and RSUs. The value of allrange between $500,000 to $4,200,000. All of these awards are inherently performance-based:
performance-based.•


Stock options are performance based because they pay nothing to our executive officers unless stockholders benefit by stock price appreciation. In addition, with aten-year life and afour-year vesting period, stock options are in sync with the time required for discovery, development and commercialization of new medicines. Our Compensation Committee believes that stock options help align executives’ interests with the long-term interests

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long-term interests of our Company and our stockholders. Stock options reinforce our belief that future potential growth of Incyte will be generated by innovation, our discovery and development pipeline, demand for our products and our commercial execution.

•

Performance shares do not become earned unlesspre-determined performance goals are met.

​

•
RSU awards grow or decline in value based on stock price, also linking executive officers’ compensation to the value delivered to stockholders.

​
In addition to theperformance-based aspects of stock options, performance shares and RSUs, thefour-year time-based vesting periods of all of these awards also serves a critical retention function.Time-based vesting helps ensure thelong-term retention of highly valuable executive officers, in whom we have invested considerable time and money, and the intellectual capital they create as well as continuity of their respective teams. The performance-based components and time-based components of our equity compensation program are designed to encourage both an appropriate level of risk-taking and a focus on sound long-term decision making, thus aligning executive interests with the long-term best interests of our Company and our stockholders.

For our 2018 annual equity grants,U.S.-based executive officers, stock options comprised 75%40%, performance shares comprised 30% and RSUs comprised 30% of the total grant date target value of an executive officer’s target2021 annual equity compensation and performance shares comprised 25%. As described above under “—Equity Grant Practices,” for 2019awards. For 2022 the Compensation Committee has determined that our U.S.-based executive officers’ annual equity award mix should be 50%will change from 40% stock options, 25%30% RSUs and 30% performance shares to equal proportions of the total grant date target dollar value awarded for stock options, RSUs and 25% RSUs to bring our practices in line with our peer group andperformance shares. The other general plan design features, such as the broader market norm and to provide greater retentive value from our equity awards.

Performancepayout percentage range for performance shares, will remain the same as those for 2021.

Fifty percent of performance shares granted in July 2018 had2021 are associated with certain clinical development objectives, including certain NDA, sNDA or MAA approvals and the initiation of certain first-in-human clinical trials. Forty percent of the performance shares have a product revenue triggerstrigger for the third year of the performance period that werewas determined by the Compensation Committee in February 2018.2021. The remaining ten percent is tied to the relative performance of the Company’s stock to the Nasdaq Biotechnology Index (NBI) between January 1, 2021 and December 31, 2023. Depending on revenuethe results actually achieved for all of these three metrics, the payout on these performance shares could have variedcan vary from 0% to 150% of target. These performance shares comprise 25%comprised 30% of an executive officer’s target equity compensation awarded in connection with our annual equity grants. The Compensation Committee believes that these performance shares align our executive officers’ interest even more closely with the financial performance of our Company and the eventual value delivered to stockholders. For 2018, the revenue target for the performance shares that would have yielded a 100% payout was an aspirational, internal, stretch target. The Compensation Committee believes such stretch revenue targets help incentivize executives to achieve maximum performance and are a key element of thepay-for-performance strategy. While we achieved record revenue in 2018, we nevertheless did not achieve the internal, stretch target. Accordingly, in February 2019, the Compensation Committee determined that the performance shares earned were only 83% of the target payout.

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Performance Share Achievement 2018

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Target Value of 2018 Equity Grants

For the 2018 annual equity grants, our CEO received awards with a grant date target value of $7,000,000 and each of our executive vice presidents received awards with a grant date target value of $1,800,000, in each case, unchanged from the values awarded in July 2017.

While, for our CEO, the Compensation Committee did not target a particular peer group percentile in setting the 2018 equity award values, in July 2018 when the Compensation Committee was actually granting these awards, it noted that then current peer group data indicated that the value of peer group long-term incentive awards had increased. Accordingly, the Compensation Committee noted that our CEO’s 2018 equity awards would result in target total direct compensation (target total cash compensation plus long-term incentive value of equity awards) approximating only the 30th percentile of our peer group. The Compensation Committee further noted that, for calendar year 2018, when including the outstanding merit stock option grant made to our CEO in January 2018 that was intended to relate to 2017 performance, our CEO’s target total direct compensation would approximate the peer group 40th percentile.

Similarly, for executive officers other than our CEO, the Compensation Committee noted in July 2018 that, because the value of peer group long-term incentive awards had increased since January 2018 when our equity target values were established, target award values likely no longer approximated the peer group 60th percentile.

Nevertheless, despite these target equity award values being lower relative to our then current peer group than initially designed to be, the Compensation Committee decided - in keeping with itspay-for-performance philosophy - that no changes would be made at that time.

For a discussion of updates to the equity grant target values undertaken by the Compensation Committee in 2019, see “—Target Value of 2019 Equity Grants” on page 45.

2021 Outstanding Merit Grants

In January 2018, certain2021, three of our named executive officers, Christiana Stamoulis, Executive Vice President and Chief Financial Officer, Steven Stein, Executive Vice President and Chief Medical Officer and Barry Flannelly, Executive Vice President, General Manager, North America, received outstanding merit optionRSU grants intended to incentivize and retain those individuals. Our CEO received a grantthem with a grant date target

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value values of $1,200,000 and certain other named executive officers - Drs. Huber,$2,000,000 for Dr. Stein and Yao - received grants with a grant date target value of $1,000,000.$1,000,000 each for Ms. Stamoulis and Dr. Flannelly. These outstanding merit optionRSU grants are subject tofour-year cliff vesting. As noted above under “—Compensation Practices and Policies—Effects of Stockholder Advisory Vote on

2021 Executive Compensation,”Team Retention Awards
In November 2021, the Compensation Committee has now eliminatedapproved retention awards for members of our executive leadership team, which includes all of our executive officers, other than our CEO. The objective of the practiceawards is to retain the leadership team through our company’s pivotal period and successful commercialization of awardingOpzelura through this period. Fifty percent of the approval date target value was granted in the form of performance shares on December 1, 2021 and the remaining 50% of the approval date target value was granted in the form of RSUs on January 1, 2022. As a result of these retention awards, no outstanding merit option grants (formerly named special option grants)were made to our CEO and no such grant was madeany executive officer in 2019.

2018 Retention Plans

With the failure of ourECHO-301 program in April 2018 and the significant stock price decline which accompanied it, the Compensation Committee believed it was vital to act to preserve the two key engines of growth within Incyte – namely, the salesforce which generates the revenue to fund ourday-to-day operations and the R&D effort which aims to produce the compounds thatJanuary 2022 for prior year performance. The performance shares will potentially lead to future growth. Accordingly, in June 2018, the Compensation Committee adopted retention plans utilizing performance share awards for certain groups of employees of our Company, namely key R&D employees and our salesforce. The R&D retention plan participants included three of our named executive officers, Drs. Huber, Stein and Yao, who each received performance share awards potentially representing 50,000 shares of common stock, which would bebecome earned based on a specific numbertriggers tied to global revenue of investigational new drug (IND) filings made by our Company during a specified time frame and,Opzelura from January 2024 to December 2024. Depending on revenue actually achieved, the payout on these performance shares can vary from 0% to 150% of target. The performance shares, if earned, would vest on the third anniversaryare subject to four-year cliff vesting. The RSUs are also subject to four-year cliff vesting. The range of the initial grant date.

Full Value Share Issuance Limits

While the Compensation Committee, in its discretion, may electtotal approval date target values of these equity awards was $500,000 to make grants of restricted shares, performance shares, RSUs or stock appreciation rights if it deems it advisable, the 2010 Stock Incentive Plan contains a limit on the total amount of shares that may be issued other than upon the exercise of stock options or stock appreciation rights or pursuant to sales of restricted shares at purchase prices at least equal to the fair market value of the shares sold. That limit is currently 3,500,000 shares and is proposed to be eliminated in connection with the amendments to the 2010 Stock Incentive Plan described under Proposal 3.

$4,000,000.

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Termination Based Compensation Under Employment Agreements and Offer Letters

Our executive officers are parties to employment agreements and offer letters, as described below under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements.”

These employment agreements and offer letters provide for severance payments and acceleration of vesting ofequity-based awards upon termination of employment under the circumstances described below under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements.” In general, the employment agreements provide for severance benefits if an officer’s employment is terminated within 24 months following a change in control. These agreements are designed both to attract executives, as we compete for talented employees in a marketplace where such protections are routinely offered, and to retain executives and provide continuity of management in the event of an actual or threatened change in control.

Other Compensation

All of ourfull-time employees, including our executive officers, may participate in our health programs, such as medical, dental and vision care coverage, and our 401(k) and life and disability insurance programs. These benefits are designed to provide our executive officers and eligible employees a competitive total compensation package that enables us to attract and retain qualified

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personnel. Under our employment agreement with our CEO, we paid the premiums with respect to asix-year insurance policy that becomes payable to the CEO or his estate upon his disability or death, although at his suggestion, in 2019, we recently amended his employment agreement to eliminate our obligation to pay the last year’s premium on that insurance policy, as described below under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements.”

Target Value of 2019 Equity Grants

In February 2019, the Compensation Committee established grant date target values for the 2019 annual equity grants for our CEO and other executive officers. In determining to establish a grant date target value of $12,900,000 for our CEO, the Committee noted that the 2019 peer group data presented to the Committee in November 2018 indicated that our CEO’s target total direct compensation (target total cash compensation plus long-term incentive value) for 2018 approximated the peer 25th percentile despite his target total cash compensation (base salary plus target bonus) approximating the peer 50th percentile. The Committee noted our Company’s overall performance in 2018 despite theECHO-301 disappointment and the CEO’s strong leadership following that development as our Company continued to increase product revenues and continued to advance product candidates through our clinical pipeline, with a number of late-stage candidates that can accelerate near-term growth. Our CEO’s 2019 equity grant date target value approximates the 2019 peer group 68th percentile for long-term incentive value and places him at approximately the peer 67th percentile for target total direct compensation. The Committee established grant date target values of $2,200,000 for each of our other executive officers who is eligible to receive annual equity grants in 2019, intended generally to approximate the peer 60th percentile for long-term incentive value. Ms. Stamoulis joined us in February 2019, received initial equity awards with an aggregate grant date target value of $3,300,000 on joining us, and will not receive a 2019 annual equity award but instead will be entitled to receive, on the first anniversary of the commencement of her employment and in July 2020, equity awards with an aggregate grant date target value of $1,300,000 and $2,200,000, respectively.

CEO Pay Ratio

As required by Section 953(b) of theDodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) ofRegulation S-K we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Hoppenot, our CEO. The pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) ofRegulation S-K.

For 2018, our last completed fiscal year:

the median of the annual total compensation of all employees of our Company (other than our CEO), was $228,006; and

the annual total compensation of our CEO, as reported in the Summary Compensation Table presented elsewhere in this Proxy Statement, was $9,314,189.

Based on this information, for 2018 the ratio of the annual total compensation of Mr. Hoppenot, our CEO, to the median of the annual total compensation of all employees was 41 to 1.

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To identify the median of the annual total compensation of all our employees, as well as to determine the annual total compensation of the “median employee,” the methodology and the material assumptions, adjustments, and estimates that we used were as follows:

We determined that, as of December 31, 2018, our employee population consisted of 1,367 employees, with 1,106 based in the United States and 261 based in Europe and Japan.

We selected December 31, 2018, which is within the last three months of 2018, as the date upon which we would identify the “median employee.”

For all employees, we examined total compensation, which included: base salary, incentive compensation plan payments fornon-sales employees, sales incentive compensation plan payments for sales employees, equity awards consisting of stock options and restricted stock units, and other compensation such as 401(k) matching contributions andCompany-paid life insurance premiums.

We included all employees, whether employed on afull-time orpart-time basis, and we annualized the compensation of all permanent employees who were not employed by us for all of 2018.

We did not make anycost-of-living adjustments in identifying the “median employee.”

For employees outside the United States, we converted their compensation to U.S. dollars using the average exchange rate for 2018.

Compensation Committee Report

This report shall not deemed to be “soliciting material” or “filed” with the Securities and Exchange Commission or be deemed incorporated by reference into any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates it by reference into a document filed under such Acts.

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis set forth in this Proxy Statement with our management. Based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference into the Company’s Annual Report onForm 10-K for the year ended December 31, 2018.

Compensation Committee

Paul A. Brooke (Chair)

Julian C. Baker

Jean-Jacques2021. Bienaimé

​Compensation Committee
Jean Jacques Bienaimé (Chair)
Julian C. Baker
Paul J. Clancy		​
​
62|Proxy Statement 2022
​​
[MISSING IMAGE: lg_incytenew-4c.jpg]
​
TABLE OF CONTENTS​​
​Executive Compensation​
Named Executive Officers

The Summary Compensation Table, Grants ofPlan-Based Awards Table and the tables that follow provide compensation information for our named executive officers, including Hervé Hoppenot, our President and CEO, David W. Gryska,Christiana Stamoulis, our Executive Vice President and Chief Financial Officer until December 31, 2018,CFO, and Reid M. Huber, Steven H. Stein, Wenqing YaoBarry P. Flannelly and Maria E. Pasquale.

46 | Proxy Statement 2019
LOGO

    Executive Compensation    

Our named executive officers’ total compensation for 20182021 as determined under the rules of the Securities and Exchange Commission, or SEC, is set forth in the following table under the caption “Total.”

SUMMARY COMPENSATION TABLE

  Name and Principal Position Year  

Salary

($)

  

Bonus

($)

  

Stock
Awards

($)(1)

  

Option
Awards

($)(1)

  

Non-Equity
Incentive  Plan
Compensation

($)(2)

  

All Other
Compensation

($)(3)

  Total ($) 

Hervé Hoppenot

  2018   995,575   —   1,733,822   5,564,508   807,769   212,515   9,314,189 

President and Chief

  2017   966,505   —   1,755,563   11,677,844   1,476,505   210,614   16,087,031 

Executive Officer

  2016   937,738   —   2,810,905   6,720,183   1,129,880   208,407   11,807,113 

David W. Gryska

  2018   586,547   —   445,824   1,123,701   237,551   38,875   2,432,498 

Executive Vice President and

  2017   569,421   —   451,372   1,588,433   434,945   35,519   3,079,690 

Chief Financial Officer (4)

  2016   552,792   —   715,609   1,649,443   332,837   17,485   3,268,166 

Steven H. Stein

  2018   522,123   —   3,733,824   2,119,070   212,625   23,874   6,611,516 

Executive Vice President and

  2017   473,070   100,000 (6)   451,372   2,688,504   362,188   24,121   4,099,255 

Chief Medical Officer (5)

  2016   442,089   —   715,609   1,649,441   266,183   16,338   3,089,660 

Reid M. Huber

  2018   465,129   —   3,733,824   2,119,070   —   34,578   6,352,601 

Executive Vice President and

  2017   493,534   —   451,372   2,688,504   376,980   40,680   4,051,070 

Chief Scientific Officer (7)

  2016   474,973   —   715,609   2,549,416   288,480   34,866   4,063,344 

Wenqing Yao

  2018   462,723   —   3,733,824   2,119,070   187,718   36,716   6,540,051 

Executive Vice President,

  2017   448,798   —   451,372   2,688,504   343,125   41,374   3,973,173 

Head of Discovery Chemistry

  2016   426,858   —   715,609   2,124,411   258,430   34,299   3,559,607 

Maria E. Pasquale

  2018   365,753   250,000 (9)   833,278   1,830,477   250,000   93,960   3,623,468 

Executive Vice President

        

and General Counsel (8)

        

(1)

SUMMARY COMPENSATION TABLE​
​
Name and Principal Position​​Year​​
Salary
($)
​​
Bonus
($)
​​
Stock
Awards
($)(1)
​​
Option
Awards
($)(1)
​​
Non-Equity
Incentive Plan
Compensation
($)(2)
​​
All Other
Compensation
($)(3)
​​
Total
($)
​
Hervé Hoppenot
President and Chief
Executive Officer
​​​​2021​​​​​1,139,709​​​​​—​​​​​7,399,170​​​​​4,689,466​​​​​1,160,596​​​​​55,324​​​​​14,444,265​​
​​​2020​​​​​1,094,731​​​​​—​​​​​8,317,223​​​​​5,515,024​​​​​1,403,468​​​​​47,746​​​​​16,378,192​​
​​​2019​​​​​1,044,376​​​​​—​​​​​6,740,953​​​​​5,937,070​​​​​1,382,183​​​​​46,656​​​​​15,151,238​​
Christiana Stamoulis
Executive Vice President and
Chief Financial Officer
​​​​2021​​​​​604,142​​​​​—​​​​​3,338,400​​​​​816,686​​​​​307,363​​​​​55,970​​​​​5,122,561​​
​​​2020​​​​​585,468​​​​​—​​​​​1,743,359​​​​​1,421,498​​​​​375,321​​​​​28,604​​​​​4,154,250​​
​​​2019​​​​​497,096​​​​​280,000(4)​​​​​824,960​​​​​2,474,685​​​​​369,600​​​​​49,327​​​​​4,495,668​​
Steven H. Stein
Executive Vice President and
Chief Medical Officer
​​​​2021​​​​​631,779​​​​​—​​​​​5,364,157​​​​​816,686​​​​​323,123​​​​​28,940​​​​​7,164,685​​
​​​2020​​​​​576,321​​​​​—​​​​​1,418,393​​​​​940,557​​​​​369,457​​​​​22,022​​​​​3,326,750​​
​​​2019​​​​​549,812​​​​​—​​​​​4,868,505​​​​​1,235,249​​​​​363,825​​​​​24,093​​​​​7,041,484​​
Barry P. Flannelly
Executive Vice President and
General Manager—NA
​​​​2021​​​​​526,783​​​​​—​​​​​2,945,522​​​​​816,686​​​​​269,423​​​​​46,644​​​​​4,605,058​​
​​​2020​​​​​480,542​​​​​—​​​​​2,342,694​​​​​940,557​​​​​308,057​​​​​45,034​​​​​4,116,884​​
​​​2019​​​​​458,438​​​​​—​​​​​1,149,505​​​​​3,490,293​​​​​303,361​​​​​41,345​​​​​5,442,942​​
Maria E. Pasquale
Executive Vice President,
General Counsel and
Corporate Secretary
​​​​2021​​​​​545,012​​​​​—​​​​​2,294,968​​​​​816,686​​​​​277,280​​​​​45,305​​​​​3,979,251​​
​​​2020​​​​​529,053​​​​​—​​​​​1,418,393​​​​​940,557​​​​​338,587​​​​​44,381​​​​​3,270,971​​
​​​2019​​​​​514,178​​​​​—​​​​​1,149,505​​​​​1,235,249​​​​​339,900​​​​​20,806​​​​​3,259,638​​
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​

​
(1)
Amounts shown do not reflect compensation actually received by the named executive officer. Instead, the amounts reported above in the “Stock Awards” and “Option Awards” columns represent the aggregate grant date fair value of stock awards and options awards granted in the respective fiscal years, as determined in accordance with ASC 718. The reported amounts for 2018 include the grant date fair value of awards of performance shares, restricted stock units (“RSUs”) and option awards. Additional information with respect to 2018 performance share, RSU and option awards is set forth in the “2018 Grants of Plan Based Awards” table below.

(2)

Amounts listed in this column represent bonuses paid under the annual incentive compensation plan for each of the respective years. These amounts are not reported in a separately identified Bonus column because the awards are tied to corporate performance objectives.

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    Executive Compensation    

(3)

Amounts listed in this column for each year represent payments made for group term life insurance and matching contributions under our 401(k) plan and also the following payments:

  Name  Year   

Life Insurance

Premiums

($)(1)

   

Financial Planning
Services

($)(2)

   

Statutory Fee for
Serving as
Director of EU
Subsidiary

($)

   

Relocation Fees

($)(3)

 

Hervé Hoppenot

   2018    160,207    27,649 (12,649)    4,400    — 
   2017    160,207    26,131 (12,631)    4,400    — 
   2016    160,207    24,118 (11,118)    4,400    — 

David Gryska

   2018    —    18,132 (6,270)    —    — 
   2017    —    15,211 (7,937)    —    — 
   2016    —    —    —    — 

Reid Huber

   2018    —    17,617 (5,617)    —    — 
   2017    —    23,683 (11,683)    —    — 
   2016    —    23,794 (11,794)    —    — 

Steven Stein

   2018    —    1,674 (479)    4,400    — 
   2017    —    2,358 (1,098)    4,400    — 
   2016    —    —    4,400    — 

Wenqing Yao

   2018    —    18,390 (5,640)    —    — 
   2017    —    23,123 (11,123)    —    — 
   2016    —    18,090 (6,090)    —    — 

Maria Pasquale

   2018    —    588 (176)    —    92,464 (28,639) 

(1)

Payment of life insurance premiums for Mr. Hoppenot is designed to compensate him for certain components of equity awards from his previous employer that he forfeited when joining Incyte. Our obligation to make these payments expired in 2019. For a more detailed explanation, please see “Employment Contracts, Termination of Employment andChange-in-Control Arrangements—President and CEO—Life Insurance and Disability Insurance Coverage” below.

(2)

Amounts in this column are inclusive of taxgross-up payments. The amount of the specific taxgross-ups are detailed in the parentheses next to the total amount.

(3)

Amounts in this column are inclusive of taxgross-up payments. The amount of the specific taxgross-ups are detailed in the parentheses next to the total amount.

(4)

Mr. Gryska resigned as Executive Vice President and Chief Financial Officer effective December 2018.

(5)

Dr. Stein was appointed Executive Vice President, Chief Medical Officer effective May 2016.

(6)

This amount represents a portion of Dr. Stein’s signing bonus in connection with the commencement of his employment and intended to compensate Dr. Stein for compensation forfeited by leaving his previous employer; payment of this portion was deferred until the second anniversary of the date of his employment.

(7)

Dr. Huber resigned as Executive Vice President and Chief Scientific Officer effective November 2018.

(8)

Ms. Pasquale was appointed Executive Vice President and General Counsel effective April 2018.

(9)

This amount represents Ms. Pasquale’s signing bonus in connection with the commencement of her employment.

48 | Proxy Statement 2019LOGO

    Executive Compensation    

2018 Grants ofPlan-Based Awards

   

Estimated Future Payouts
Under Non-Equity  Incentive
Plan Awards(1)(2)		 
 
 		   

Estimated Future Payouts
Equity Incentive
Plan Awards Shares (3)		 
 
 		  





All Other
Stock Awards:
Number of
Shares of
Stocks or
Units

(#) (4)

 
 
 
 
 
 

 

  





All Other
Option Awards:
Number of
Securities
Underlying
Options

(#)

 
 
 
 
 
 

 

  




Exercise
or Base
Price of
Option
Awards
($/Sh)		 
 
 
 
 
 		  




Grant Date
Fair Value
of Stock
and Option
Awards
($)(5)		 
 
 
 
 
 
  Name Grant
Date		  Threshold
($)		  Target
($)		  Maximum
($)		     Threshold
(#)		  Target
(#)		  Maximum
(#)		 

Hervé Hoppenot

   747,935   997,246   1,495,869         
  01/23/2018           47,168 (6)   94.63     1,766,502 
  01/24/2018           25,401 (7)   95.34     1,194,472 
  07/02/2018           88,557 (8)   68.62     2,603,534 
  07/02/2018       12,633   25,267   37,900     68.62     1,733,822 

David W. Gryska (9)

   220,325   293,766   440,649         
  01/23/2018           12,128 (6)   94.63     454,212 
  07/02/2018           22,772 (8)   68.62     669,489 
  07/02/2018       3,248   6,497   9,745     68.62     445,824 

Steven H. Stein

   196,875   262,500   393,750         
  01/23/2018           12,128 (6)   94.63     454,212 
  01/24/2018           21,167 (7)   95.34     995,370 
  07/02/2018           22,772 (8)   68.62     669,489 
  06/28/2018        50,000      65.76     3,288,000 
  07/02/2018       3,248   6,497   9,745     68.62     445,824 

Reid Huber (10)

   190,962   254,616   381,924         
  01/23/2018           12,128 (6)   94.63     454,212 
  01/24/2018           21,167 (7)   95.34     995,370 
  07/02/2018           22,772 (8)   68.62     669,489 
  06/28/2018        50,000      65.76     3,288,000 
  07/02/2018       3,248   6,497   9,745     68.62     445,824 

Wenqing Yao

   173,813   231,750   347,625         
  01/23/2018           12,128 (6)   94.63     454,212 
  01/24/2018           21,167 (7)   95.34     995,370 
  07/02/2018           22,772 (8)   68.62     669,489 
  06/28/2018        50,000      65.76     3,288,000 
  07/02/2018       3,248   6,497   9,745     68.62     445,824 

Maria E. Pasquale (11)

   187,500   250,000   375,000         
  04/09/2018           41,193 (8)   65.36     1,160,988 
  07/02/2018           22,772 (8)   68.62     669,489 
  04/09/2018          5,928      65.36     387,454 
   07/02/2018                   3,248   6,497   9,745           68.62     445,824 

(1)

The target amounts shown reflect our annual incentive plan awards originally provided under the 2018 incentive compensation plan and represent thepre-established target awards as a percentage of base salary for the 2018 fiscal year, with the potential for actual awards under the plan to either exceed or be less than such funding target depending upon corporate performance. Actual award amounts are not guaranteed and are determined at the discretion of the Compensation Committee, which may consider an individual’s performance during the period. For additional information, please refer to the section titled “Executive Compensation—Compensation Discussion and Analysis—Key Elements of Executive Compensation—Annual Incentive Compensation Plan.” Actual 2018 incentive compensation plan payouts are reflected in theNon-Equity Incentive Plan Compensation column of the Summary Compensation Table.

(2)

The threshold amounts shown illustrate the smallest payout that can be made under the 2018 incentive compensation plan if all of thepre-established performance objectives are achieved at the minimum achievement level. The target amounts shown are the payouts that can be made if all of thepre-established performance objectives have been achieved at the target achievement level and, as noted in footnote (1), correlate to thepre-established target awards as a percentage of base salary. The maximum amounts shown are the greatest payout that can be made if all of thepre-established maximum performance objectives are achieved or exceeded at the outperform achievement levels and all potential bonus points under the 2018 incentive compensation plan were earned. Actual awards may be more or less than these amounts and, as

LOGOProxy Statement 2019 | 49

    Executive Compensation    

noted in footnote (1), are at the discretion of the Compensation Committee. For additional information, please refer to the section titled “Executive Compensation—Compensation Discussion and Analysis—Key Elements of Executive Compensation—Annual Incentive Compensation Plan.”

(3)

Awards under these columns represent performance shares. For the awards made on June 28, 2018, the performance shares become earned only if a specified number of investigational new drug (IND) filings are made during a specified time frame and, if earned, would vest on the third anniversary of the initial grant date. For the awards made on July 2, 2018, the actual number of number of shares of common stock into which each performance share award may convert will be calculated by multiplying the target number of performance shares allocated to that award by performance percentage multipliers ranging from 0% to 150% based on the actual level at which the applicable revenue-based performance goal is achieved, as certified by the Compensation Committee. The performance period was the year ended December 31, 2018 and achievement of maximum, target and threshold levels will result in percentage multipliers of 150%, 100% and 50%, respectively, with achievement below the threshold level resulting in a percentage multiplier of 0%. In February 2019, the Compensation Committee of the Board of Directors determined that the performance shares were earned at the 83% level, resulting in 20,571 shares being earned by Mr. Hoppenot and 5,389 shares earned by the other executive officers who received performance shares, and the earned shares will vest in equal installments on each of the first four anniversaries of the grant date of July 2, 2018. For additional information, please refer to the section titled “Executive Compensation—Compensation Discussion and Analysis—Key Elements of Executive Compensation—Equity Based Incentive Awards.”

(4)

Represents RSUs that will vest in equal installments on each of the first four anniversaries of the grant date. Vesting of the RSUs is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements” below. The RSUs were granted in connection with the commencement of Ms. Pasquale’s employment.

(5)

Represents the aggregate fair value of stock and option awards computed as of the grant date of each performance share, RSU or option award in accordance with ASC 718, rather than amounts paid to or realized by the named individual. There can be no assurance that options will be exercised (in which case no value will be realized by the individual), that the value on exercise of options will approximate the compensation expense we recognized, or that the price of our common stock when RSUs vest and if and when performance shares vest will equal or exceed the price of our common stock on the date of the applicable RSU or performance share award. The grant date fair values of performance shares were calculated by multiplying the closing price of our common stock on the grant date by the target number of shares payable if the performance targets for those shares are achieved at the target level of 100%.

(6)

Options become exercisable as toone-fourth of the shares on July 5, 2018, with the remaining shares vesting ratably each month thereafter over the following three years, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Vesting of the options is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements” below.

(7)

Options become exercisable as to all of the shares on the fourth anniversary of the grant date, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Vesting of the options is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements” below.

(8)

Options become exercisable as toone-fourth of the shares on the first anniversary of the grant date, with the remaining shares vesting ratably each month thereafter over the following three years, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Vesting of the options is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements” below.

(9)

Mr. Gryska resigned as Executive Vice President and Chief Financial Officer effective December 2018.

(10)

Dr. Huber resigned as Executive Vice President and Chief Scientific Officer effective November 2018.

(11)

Ms. Pasquale was appointed Executive Vice President and General Counsel effective April 2018.

Salary

The annual salaries of the named executive officers are reflected underofficer. Instead, the Salary columnamounts reported above in the “Stock Awards” and “Option Awards” columns represent the aggregate grant date fair value of stock awards and options awards granted in the Summary Compensation Table.respective fiscal years, as determined in accordance with ASC 718. The Compensation Committee reviews salaries on an annual basis,reported amounts for 2019, 2020, and may change each executive officer’s salary based on2021 include the individual’s contributionsgrant date fair value of awards of performance shares, RSUs and responsibilities over the prior twelve months and any change in comparable company pay levels. In

50 | Proxy Statement 2019LOGO

    Executive Compensation    

January 2018, the Compensation Committee set the 2018 base salaries for our executive officers. Salary compensation is discussed in greater detail under the heading “Executive Compensation—Compensation Discussion and Analysis.”

Incentive Compensation

All named executive officers who continued to be employed by us at the time of the January 2019 Compensation Committee determinationstock options. Additional information with respect to achievement2021 performance share, RSU and stock option awards is set forth in the “2021 Grants of Plan Based Awards” table below.

​
(2)
Amounts listed in this column represent bonuses paid under our discretionary 2018the annual incentive compensation plan receivedfor each of the respective years. These amounts are not reported in a bonusseparately identified Bonus column because the awards are tied to corporate performance objectives.
​
(3)
Amounts listed in this column for each year represent payments made for matching contributions under our 401(k) plan and also the following payments:
​
Name​​Year​​
Life
Insurance
Premiums
($)(a)
​​
Financial Planning
Services
($)(b)
​​
Statutory Fee for
Serving as Director
of EU Subsidiary
($)
​​
Travel
Reimbursement
($)(b)(c)
​
Hervé Hoppenot​​​​2021​​​​​7,524​​​​​27,752(12,752)​​​​​4,400​​​—​
​​​2020​​​​​7,730​​​​​21,723(6,723)​​​​​2,200​​​—​
​​​2019​​​​​5,125​​​​​21,643(6,643)​​​​​4,400​​​—​
Christiana Stamoulis​​​​2021​​​​​2,622​​​​​15,424(4,774)​​​​​—​​​20,524 (6,352)​
​​​2020​​​​​2,321​​​​​4,055(1,255)​​​​​—​​​5,128 (1,536)​
​​​2019​​​​​811​​​​​10,883(3,321)​​​​​—​​​21,133 (6,239)​
Steven H. Stein​​​​2021​​​​​4,902​​​​​2,238(693)​​​​​4,400​​​—​
​​​2020​​​​​2,315​​​​​2,607(807)​​​​​2,200​​​—​
​​​2019​​​​​1,377​​​​​1,816(521)​​​​​4,400​​​—​
Barry P. Flannelly​​​​2021​​​​​7,502​​​​​21,742(6,742)​​​​​—​​​—​
​​​2020​​​​​6,192​​​​​21,742(6,742)​​​​​—​​​—​
​​​2019​​​​​3,226​​​​​21,619(6,619)​​​​​—​​​—​
Maria E. Pasquale​​​​2021​​​​​4,902​​​​​23,003(8,003)​​​​​—​​​—​
​​​2020​​​​​4,267​​​​​23,014(8,014)​​​​​—​​​—​
​​​2019​​​​​1,278​​​​​3,028(1,003)​​​​​—​​​—​
​
[MISSING IMAGE: lg_incytenew-4c.jpg]
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Proxy Statement 2022|63
​
TABLE OF CONTENTS
​Executive Compensation​
(a)
Payment of life insurance premiums for Mr. Hoppenot in 2018 fiscal year underand earlier years was designed to compensate him for certain components of equity awards from his previous employer that plan, althoughhe forfeited when joining Incyte. Our obligation to make these payments expired in 2019. For a more detailed explanation, please see “Employment Contracts, Termination of Employment and Change-in-Control Arrangements—President and CEO—Life Insurance and Disability Insurance Coverage” below.
​
(b)
Amounts in this column are inclusive of tax gross-up payments. The amount of the bonusspecific tax gross-ups are detailed in the parentheses next to the total amount.
​
(c)
Amounts in this column constitute reimbursement for travel expenses in lieu of a relocation package pursuant to Ms. Pasquale wasStamoulis’ offer letter with the negotiatedCompany.
​
(4)
This amount determinedrepresents Ms. Stamoulis’ signing bonus in connection with the commencement of her employment in April 2018. This bonus is reflectedemployment.
​
​
64|Proxy Statement 2022
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TABLE OF CONTENTS
​Executive Compensation​
2021 Grants of Plan-Based Awards
Name​​Grant Date​​
Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards(1)(2)
​​
Estimated Future Payouts
Equity Incentive
Plan Awards Shares(3)
​​
All Other
Stock Awards:
Number of
Shares of
Stocks or
Units
(#)(5)
​​
All Other
Option Awards:
Number of
Securities
Underlying
Options
(#)
​​
Exercise
or Base
Price of
Option
Awards
($/Sh)
​​
Grant Date
Fair Value
of Stock
and Option
Awards
($)(8)
​
​
Threshold
($)
​​
Target
($)
​​
Maximum
($)
​​
Threshold
(#)
​​
Target
(#)
​​
Maximum
(#)
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Hervé Hoppenot​​​​​​​​​​857,583​​​​​1,143,444​​​​​2,344,060​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​74,720(6)​​​​​90.56​​​​​2,228,195​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​84,851(7)​​​​​83.58​​​​​2,461,271​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​33,198​​​​​44,264​​​​​66,396(3)​​​​​​​​​​​​​​​​​83.58​​​​​3,699,585​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​44,264​​​​​​​​​​​83.58​​​​​3,699,585​​
Christiana Stamoulis​​​​​​​​​​227,115​​​​​302,820​​​​​620,781​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​11,522​​​​​​​​​​​90.56​​​​​1,043,432​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​12,743(6)​​​​​90.56​​​​​380,009​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​15,054(7)​​​​​83.58​​​​​436,676​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​5,890​​​​​7,853​​​​​11,780(3)​​​​​​​​​​​​​​​​​83.58​​​​​656,354​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853​​​​​​​​​​​83.58​​​​​656,354​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​7,561​​​​​15,121​​​​​22,682(4)​​​​​​​​​​​​​​​​​64.96​​​​​982,260​​
Steven H. Stein​​​​​​​​​​238,761​​​​​318,348​​​​​652,612​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​23,044​​​​​​​​​​​90.56​​​​​2,086,865​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​12,743(6)​​​​​90.56​​​​​380,009​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​15,054(7)​​​​​83.58​​​​​436,676​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​5,890​​​​​7,853​​​​​11,780(3)​​​​​​​​​​​​​​​​​83.58​​​​​656,354​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853​​​​​​​​​​​83.58​​​​​656,354​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​15,122​​​​​30,243​​​​​45,365(4)​​​​​​​​​​​​​​​​​64.96​​​​​1,964,585​​
Barry P. Flannelly​​​​​​​​​​199,081​​​​​265,441​​​​​544,154​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​11,522​​​​​​​​​​​90.56​​​​​1,043,432​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​12,743(6)​​​​​90.56​​​​​380,009​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​15,054(7)​​​​​83.58​​​​​436,676​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​5,890​​​​​7,853​​​​​11,780(3)​​​​​​​​​​​​​​​​​83.58​​​​​656,354​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853​​​​​​​​​​​83.58​​​​​656,354​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​4,537​​​​​9,073​​​​​13,610(4)​​​​​​​​​​​​​​​​​64.96​​​​​589,382​​
Maria E. Pasquale​​​​​​​​​​204,887​​​​​273,182​​​​​560,023​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​12,743(6)​​​​​90.56​​​​​380,009​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​15,054(7)​​​​​83.58​​​​​436,676​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​5,890​​​​​7,853​​​​​11,780(3)​​​​​​​​​​​​​​​​​83.58​​​​​656,354​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853​​​​​​​​​​​83.58​​​​​656,354​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​7,561​​​​​15,121​​​​​22,682(4)​​​​​​​​​​​​​​​​​64.96​​​​​982,260​​
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(1)
The target amounts shown reflect our annual incentive plan awards originally provided under theNon-Equity Incentive Plan Compensation column 2021 incentive compensation plan and represent the pre-established target awards as a percentage of base salary for the Summary Compensation Table because the bonus is tied to the corporate performance of the Company. The plan established cash incentive awards for all of our eligible employees for 2018, and was designed to align incentive awards for each participant’s individual performance with our corporate goals. Incentive awards for our executive officers were approved by the Compensation Committee in January 2019 and paid in February 2019 pursuant to this plan. Our executive officers each had a funding target under the plan,2021 fiscal year, with the potential for actual awards under the plan to either exceed or be less than such funding target depending upon corporate performance, as well as each executive officer’s individual performance. The range of the 2018 awardsActual award amounts are not guaranteed and are determined at the timediscretion of establishment of the plan is set forth under the Estimated Future Payouts UnderNon-Equity Incentive Plan Awards column to the Grants ofPlan-Based Awards Table. Actual incentive award amounts paid to named executive officers for 2018 pursuant to this plan were based on the achievement of corporate goals that were predetermined by the Compensation Committee, as described in greater detail underwhich may consider an individual’s performance during the headingperiod. For additional information, please refer to the section titled “Executive Compensation—Compensation Discussion and Analysis,Analysis—Key Elements of Executive Compensation—​Annual Incentive Compensation Plan.” and is disclosedActual 2021 incentive compensation plan payouts are reflected in theNon-Equity Non Equity Incentive Plan Compensation column of the Summary Compensation Table.

In January 2018, all named executive officers who were then employed by us received grants of options For additional information, please refer to purchase common stock in connection with our annual equity award cycle and certain named executive officers also received outstanding merit option grants, and in July 2018, in connection with our annual equity award cycle, all named executive officers received grants of options to purchase common stock and performance shares. As described in greater detail under the headingsection titled “Executive Compensation—Compensation Discussion and Analysis,Analysis—Key Elements of Executive Compensation—Incentive Awards for Named Executive Officers.”

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(2)
The threshold amounts shown illustrate the outstanding merit option grantssmallest payout that can be made under the 2021 incentive compensation plan if all of the pre-established performance objectives are achieved at the minimum achievement level. The target amounts shown are the payouts that can be made if all of the pre-established performance objectives have been achieved at the target achievement level and, as noted in footnote (1), correlate to the pre-established target awards as a percentage of base salary. The maximum amounts shown are the greatest payouts that can be made if the compensation plan were intendedearned. Actual awards may be more or less than these amounts and, as noted in footnote (1), are at the discretion of the Compensation Committee. For additional information, please refer to incentivizethe section titled—”Executive Compensation—Compensation Discussion and retainAnalysis—Key Elements of Executive Compensation—Annual Incentive Compensation Plan.”
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(3)
Awards under these columns represent performance shares. For the recipientsawards made on July 2, 2021, the actual number of those grantsshares of common stock into which each performance share award may convert will be calculated by multiplying the target number of performance shares allocated to that award by performance percentage multipliers ranging from 0% to 150% based on the actual level at which the applicable development, relative TSR and revenue based performance goals are achieved, as certified by the Compensation Committee. The performance period will end
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December 31, 2023 and achievement of maximum, target and threshold levels will result in percentage multipliers of 150%, 100% and 75%, respectively, with achievement below threshold level resulting in a percentage multiplier of 0%. In November 2021, the Compensation Committee of the Board of Directors determined that the performance shares granted on July 2, 2021, were tiedearned to a corporate-baseddate at the 30.0% level (representing the achievement of threshold performance goal. The numberslevel of the development goal weighted at 40%) thereby resulting in 13,279 shares being earned by Mr. Hoppenot and grant date fair values of these awards under ASC 718 are set forth2,355 shares earned by the other executive officers who received performance shares, and the earned shares will vest in the Grants ofPlan-Based Awards Table. The exercise price for options awarded in 2018 was the fair market value of our common stockfull on the grant date. The options awarded in January 2018 under our equity grant guidelines will generally vest and become exercisable as toone-fourth of the shares on the first anniversary of the July 2017 grant date, with the remaining shares vesting ratably each month thereafter over the following three years. The options awarded in July 2018 will generally vest and become exercisable as toone-fourth of the shares on the firstthird anniversary of the grant date with the remaining shares vesting ratably each month thereafter over the following three years. The outstanding merit option grants awarded in January 2018 will vest and become exercisable as to allof July 2, 2021. Vesting of the performance shares is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change in Control Arrangements” below. For additional information, please refer to the section titled “Executive Compensation—Compensation Discussion and Analysis—Key Elements of Executive Compensation—Equity Based Incentive Awards.”
(4)
For the performance share awards made on December 1, 2021, the actual number of shares of common stock into which each performance share award may convert will be calculated by multiplying the target number of performance shares allocated to that award by performance percentage multipliers ranging from 0% to 150% based on the fourth anniversaryactual level at which the global revenue of Opzelura performance goals are achieved, as certified by the Compensation Committee. The performance period will end December 31, 2024 and achievement of maximum, target and threshold levels will result in percentage multipliers of 150%, 100% and 50%, respectively, with achievement below the threshold level resulting in a percentage multiplier of 0%. Vesting of the grant date. The options awarded in January 2018 and in July 2018, and outstanding merit option grants, have a term of ten years from the grant date. The performance shares if earned,is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change in Control Arrangements” below. For additional information, please refer to the section titled “Executive Compensation—Compensation Discussion and Analysis—Key Elements of Executive Compensation—2021 Executive Team Retention Awards.”
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(5)
Represents RSUs that will vest in equal installments on each of the first four anniversaries of the grant date.

In April 2018, Ms. Pasquale received optionsdate, except for the RSUs granted on January 15, 2021 to Christiana Stamoulis, Steven H. Stein and RSUs in connection with her employment with us; the optionsBarry P. Flannelly that will vest in full on the fourth anniversary of the date of grant. Vesting of the RSUs is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and becomeChange in Control Arrangements” below.

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(6)
Options became exercisable as toone-fourth one fourth of the shares on July 2, 2021, with the first anniversary

LOGOProxy Statement 2019 remaining shares vesting ratably each month thereafter over the following three years, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Vesting of the options is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change in Control Arrangements” below.| 51

    Executive Compensation    

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(7)
Options became exercisable as to one fourth of the shares after one year from the grant date, with the remaining shares vesting ratably each month thereafter over the following three years, and the RSUs will vesthave a term of ten years, subject to earlier termination in equal installments on eachcertain events relating to termination of employment. Vesting of the first four anniversariesoptions is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change in Control Arrangements” below.
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(8)
Represents the aggregate fair value of stock and option awards computed as of the grant date.

In June 2018, certaindate of our named executive officers were participants in our R&D retention plan and receivedeach performance share, awards that are describedRSU or option award in greater detail under the heading “Executive Compensation—Compensation Discussion and Analysis.”

Theaccordance with ASC 718, rather than amounts if any, actuallypaid to or realized by the named executive officers forindividual. There can be no assurance that options will be exercised (in which case no value will be realized by the 2018 awardsindividual), that the value on exercise of options will vary depending onapproximate the vesting of the award andcompensation expense we recognized, or that the price of our common stock in relation towhen RSUs vest and if and when performance shares vest will equal or exceed the exercise price of our common stock on the date of the applicable RSU or performance share award. The grant date fair values of performance shares were calculated by multiplying the closing price of our common stock on the grant date by the target number of shares payable if the performance targets for those shares are achieved at the timetarget level of exercise. Detail regarding the number of exercisable and unexercisable options held by each named executive officer at100%.

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year-end is set forth in the Outstanding Equity Awards at FiscalYear-End Table.

Compensation Risk Assessment

The Compensation Committee, in consultation with the Company’s executive management, reviewed the Company’s compensation policies and practices for its employees and concluded that risks arising from those policies and practices are not reasonably likely to have a material adverse effect on the Company.

Employment Contracts,

Termination of Employment and Change-in-Control Arrangements
Change-in-ControlWe have entered into agreements that may require us to make payments or provide benefits to our named executive officers—Mr. Hoppenot, Ms. Stamoulis, Dr. Stein, Dr. Flannelly, and Ms. Pasquale—in connection with specified terminations of employment. The amount and type of compensation payable to each of these named executive officers upon termination of employment under various circumstances and upon a change in control are described below. Arrangements
Equity Awards

In April 2014, the Compensation Committee and Management Stock Option Committee approved amendments to outstanding employee stock option and RSU agreements and to the forms of agreements for future employee stock option and RSU agreement to provide that, in the event of a change in control of the Company, (i) if the successor corporation does not assume or substitute comparable awards for all outstanding employee options and RSUs, then as of the date of completion of the change in control transaction, the vesting of such options and RSUs shall be accelerated in full, and (ii) if outstanding options and RSUs are assumed or replaced by comparable awards by the successor corporation and within one year after the change in control, an equity awardee’s service as an employee is terminated without cause or due to constructive termination, then the vesting of such person’s assumed
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TABLE OF CONTENTS
​Executive Compensation​
or substituted options and RSUs shall be accelerated in full. The value of such accelerationPerformance share awards made in full for each Named Executive Officer, assuming such termination or event was effective as of December 31,and after 2018 is set forthcontain provisions that will result in accelerated vesting in the table below under the heading “Potential Payments Upon Terminationevent of a change in Connectioncontrol similar to that for outstanding options and RSUs. Performance share awards made in and after 2020 further provide that, in connection with a Changechange in Control.”

control vesting event, the awards are deemed to be earned at the actual level of achievement or, if the target level is greater, at the target level.

Agreement with Our President and CEO

In connection with his appointment as President and CEO in January 2014, Mr. Hoppenot and the Companywe entered into an offer of employment letter and an employment agreement.

Pursuant toagreement with Mr. Hoppenot.

In connection with the offer letter, Mr. Hoppenot was entitled to an initial base salary of $800,000 and participated in the Company’s annual incentive compensation plan with a funding target for a cash bonus under such plan of 100%commencement of his annual base salary and a minimum bonus for 2014 of $800,000.employment, Mr. Hoppenot’s base salary is reviewed annually by the Compensation Committee. Future bonuses under the incentive compensation plan will be determined by the Compensation Committee in its discretion based on the achievement of performance goals to be determined annually by the Board or, as applicable, the Committee. Pursuant to the offer letter, Mr. Hoppenot also received a signing bonus of $2,200,000, one quarter of which was paid upon commencement of employment and the remainder of which was paid in equal installments on the first day of each of the second, third and fourth calendar

52 | Proxy Statement 2019LOGO

    Executive Compensation    

quarters of 2014. Except as otherwise provided in his employment agreement, Mr. Hoppenot must have remained employed by the Company through the first calendar day of each such quarter in order to receive the respective quarterly portion of the signing bonus.

Mr. Hoppenot received an initial award in January 2014 of options to purchase 124,148 shares of common stock and 17,428 performance shares under the Company’s 2010 Stock Incentive Plan with an aggregate value as of the grant date equal to $4,500,000, determined under generally accepted accounting principles consistent with the valuation of the Company’s equity incentives. Mr. Hoppenot will be eligible to receive future annual equity awards as determined by the Compensation Committee, and all such equity awards, including the initial award, will be subject to vesting or attainment of performance criteria, as applicable, at the same levels as apply to awards of the same type granted to the Company’s other senior executives for the same fiscal year. Mr. Hoppenot also received in January 2014 aone-time grant of 400,000 RSUs, designed to make him whole for equity he forfeited at his previous employer and also to further incentivize retention over asix-year period. Each RSU representsrepresented the right to acquire one share of the Company’sour common stock. Vesting of the RSUs will bewas subject to Mr. Hoppenot’s continued employment on the applicable vesting dates, withone-sixth of the RSUs vesting at the end of each of the calendar years 2014 through 2019, subject to earlier acceleration of vesting upon the occurrence of certain events in accordance with the terms of his employment agreement.

2019.

Termination Without Good Reason Prior to a Change in Control.   If Mr. Hoppenot voluntarily terminates his employment with the Company other than for good reason and other than in the24-month period following a change in control (the “Change in Control Employment Period”), the Companywe will pay Mr. Hoppenot, to the extent not already paid, his annual base salary through the date of termination, any deferred compensation and any accrued vacation pay.

Termination Without Good Reason in Connection with a Change in Control.   If Mr. Hoppenot terminates his employment with the Companyus without good reason during the Change in Control Employment Period, the Companywe will pay Mr. Hoppenot, to the extent not already paid, his annual base salary through the date of termination, any deferred compensation, any accrued vacation pay, and an amount equal to a pro rata portion of his target bonus calculated according to the number of days he worked through the date of termination in the current fiscal year.

Termination Without Cause or for Good Reason Not in Connection with a Change in Control.   If, at any time other than during the Change in Control Employment Period, Mr. Hoppenot’s employment is terminated by the Companyus without cause or by Mr. Hoppenot for good reason, the Companywe will pay Mr. Hoppenot, to the extent not already paid, his annual base salary through the date of termination, his signing bonus, any deferred compensation, any accrued vacation pay, and an amount equal to a pro rata portion of his target bonus for the preceding fiscal year calculated according to the number of days he worked through the date of termination in the current fiscal year. In addition, the Companywe will pay him an amount equal to the sum of 1.5 times his annual base salary and the greater of his current target bonus or hisactual bonus amount for the preceding fiscal year. The agreement also provides that Mr. Hoppenot’s stock options and RSUs (other than hisone-time grant of 400,000 RSUs) will vest as to the amount that would have vested had he continued to work for the Companyus for an additional 18 months. All options would continue to be exercisable for 180 days following the date of termination. In addition, the agreement provides that the 400,000 RSUs granted in connection with joining the Company will vest as to 100% of the amount that would have vested had he continued to work for the Company for an additional 12 months and vest as to 50% of the amount that would have vested had he continued to work for the Company for an additional 12 months subsequent to the initial 12 months after the date of termination. The agreement also provides for the payment by us of COBRA premiums, by the

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    Executive Compensation    

Company, or the cash equivalent thereof, for Mr. Hoppenot and his family for up to 12 months, outplacement services for up 12 months, as well as payment with respect to any other accrued amounts under other of the Company’sour benefits arrangements.

Termination in Connection with a Change in Control Without Cause or for Good Reason.   If during the Change in Control Employment Period Mr. Hoppenot’s employment is terminated by the Companyus without cause or by Mr. Hoppenot for good reason, the Companywe will pay Mr. Hoppenot, to the extent not already paid, his annual base salary through the date of termination, his signing bonus, any deferred compensation, any accrued vacation pay, and an amount equal to a pro rata portion of his target bonus for the preceding fiscal year calculated according to the number of days he worked through the date of termination in the current fiscal year. In addition, the Companywe will pay him an amount equal to three times the sum of his current annual base salary and the greater of his current target bonus or hisactual bonus amount for the preceding fiscal year. The agreement also provides that in the event of such a termination, all of Mr. Hoppenot’s unvested RSUs and unvested stock options will vest in full, and all stock options will remain exercisable for 12 months following his termination. In addition, all performance shares will vest in full and be settled assuming the target level of performance has been achieved. The agreement also provides for the continuation of benefits for Mr. Hoppenot and his family for up to 36 months, outplacement services for up 12 months, as well as payment with respect to any other accrued amounts under other of the Company’sour benefits arrangements.

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Life Insurance and Disability Insurance Coverage.   When Mr. Hoppenot became our CEO in January 2014, after being recruited by our Board, he forfeited certain equity basedequity-based awards with his previous employer that had provided for an acceleration of vesting of a majority of the awards in the event of his death or permanent disability. Ourone-time grant of 400,000 RSUs to Mr. Hoppenot, described above, doesdid not contain a similar provision. To provide Mr. Hoppenot with similar economic value commensurate with the equity based awards he had forfeited in order to join us, we agreed in Mr. Hoppenot’s employment agreement to pay the premiums for an insurance policy that will remain in place for thesix-year period that commenced on the first day of his employment that will pay $15 million to Mr. Hoppenot upon termination of his employment for disability or his estate on his death. Thesix-year period for the life and disability insurance iswas the same vesting period for the 400,000 RSUs. Mr. Hoppenot’s initial employment agreement also required us togross-up each premium amount so that the total payment made by us was sufficient to cover the premiums and all federal, state and local income taxes incurred by Mr. Hoppenot. In April 2015, we amended Mr. Hoppenot’s employment agreement so that we would no longer be required togross-up each premium amount to cover taxes incurred by Mr. Hoppenot. In 2019, at Mr. Hoppenot’s suggestion, we amended Mr. Hoppenot’s employment agreement so that we would no longer be required to pay the premiums for the life and disability insurance coverage for 2019, the last year of vesting of Mr. Hoppenot’s initial RSU grant.

Post-Retirement Vesting.   In October 2019, we amended Mr. Hoppenot’s employment agreement to provide that should Mr. Hoppenot remain employed by us through his retirement on a date after December 31, 2024 (as such date may be extended by mutual agreement), all outstanding unvested equity awards that are granted by us to Mr. Hoppenot after July 15, 2019 and before December 31, 2024 (or such later date after December 31,
2024) as may be mutually agreed upon would continue to vest as if he continued to be employed by us following the date of his retirement. In addition, any outstanding stock option awards that are granted to Mr. Hoppenot after July 15, 2019 and before December 31, 2024 (or such later date after December 31, 2024 as may be mutually agreed upon) that either were vested at the date of his retirement or become vested due to the post-retirement continued vesting provisions will be exercisable during the remainder of their original term. The effectiveness of these provisions will be subject to Mr. Hoppenot’s continued compliance with the non-solicitation/non-hiring and non-disparagement covenants described below, including during any period of post-retirement continued vesting provided by the amendments to the agreement.
Other Covenants.   Under the agreement, Mr. Hoppenot is subject tonon-solicitation/non-hiring andnon-disparagement covenants that extend two years from termination of employment. Upon certain breaches of those covenants after termination of employment, Mr. Hoppenot must forfeit all of his unvested stock options, stock appreciation rights, restricted stock units, performance shares, and the gain or income realized from the exercise, vesting or settlement of the same within 24 months prior to the breach.

Agreements with Other Named Executive Officers

In November 2003, our Board approved a form of employment agreement for Executive Vice Presidents and certain other senior employees. The form of employment agreement for the Executive Vice Presidents and certain other senior employees was amended in December 2008 to comply with

54 | Proxy Statement 2019LOGO

    Executive Compensation    

Section 409A of the Internal Revenue Code of 1986, as amended. In April 2012, the employment agreements with our Executive Vice Presidents and certain other senior employees were amended to increase the amount payable upon an “involuntary termination” of the executive’s employment within 24 months following a change in control. The CompanyWe entered into an employment agreement with Reid M. Huber in May 2011, Steven H. Stein in March 2015 and Wenqing Yao in November 2003 while eachhe served as one of our senior employees. The CompanyWe entered into an employment agreements with David W. GryskaBarry P. Flannelly in OctoberAugust 2014, upon his employment as Executive Vice President and Chief Financial Officer and with Maria E. Pasquale in April 2018 and with Christiana Stamoulis in February 2019 upon hertheir employment as Executive Vice President and General Counsel.

with us.

The employment agreements with our Executive Vice Presidents provide that in the event of an “involuntary termination” of the executive’s employment within 24 months following a change in control (which includes actual termination without cause and constructive termination by way of the assignment of duties substantially and materially inconsistent with the executive’s position or other diminishment in position, requiring the executive to be based at any location outside more than 35 miles from the office or location where he or she was based prior to a change in control, a reduction in salary, bonus or adverse change in benefits, or a breach by the Companyus of the terms of the executive’s employment arrangement), we will pay the executive an amount equal to two times the sum of the executive’s current annual base salary and the greater of (1) the executive’s current target bonus or (2) the executive’s bonus amount for the preceding fiscal year.
​
68|Proxy Statement 2022
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TABLE OF CONTENTS
​Executive Compensation​
A “change in control” generally includes a significant change in the composition of the Board, the acquisition by any person or entity of greater than 50% of the combined voting power of the Company’sour outstanding securities, the approval of aour liquidation or dissolution, of the Company, or the sale or disposition of all or substantially all of the Company’sour assets or similar transaction. We will also pay the executive a pro rata portion of the executive’s target bonus calculated according to the number of days the executive worked through the termination date in the current fiscal year. The cash payment would be paid in a lump sum payment following the executive’s termination.
The agreement also provides that in the event of such a termination, all of the executive’s unvested stock options will vest in full, and all stock options will be exercisable for 12 months following the executive’s termination. In addition, the agreement provides for the reimbursement by us of COBRA premiums by the Company for the executive and eligible dependents for up to 12 months, reimbursement (or payment) by the Companyus for the cost of continued life and disability insurance for the executive for 12 months at the same levels in effect on the termination date, as well as payment with respect to any other accrued amounts under other of the Company’sour benefits arrangements.

Christiana Stamoulis.   In December 2018, in connection with her appointment as Executive Vice President and Chief Financial Officer, Ms. Stamoulis received an offer letter that provides that if her employment is terminated without cause or for good reason, we will pay her an amount equal to the sum of her current annual base salary and her current target bonus, as well as amounts with respect to any other accrued amounts under other of our benefits arrangements. We will also pay the cost of COBRA premiums for one year, or until she becomes eligible for medical insurance with another employer.
Potential Payments Upon Termination Without a Change in Control

The following table describes the potential payments and benefits triggered by a termination of employment of a named executive officer byfor the Company without cause, or byreasons specified in the executive for good reason,table, in each case prior to a change in control and assuming the employment of the named executive officer was terminated on December 31, 2018.

  Termination Cash
Payment
($)		  Medical/
Insurance
Benefits
($)		  Acceleration
of Equity
Awards
($)(1)		  Other
($)(2)		  Total
($)		 

Hervé Hoppenot

     

Termination without cause

  4,707,873   30,502   6,624,425   236,025   11,598,825 

2021.
Termination​​
Cash
Payment
($)
​​
Medical/​
Insurance
Benefits
($)
​​
Acceleration
of Equity
Awards
($)(1)
​​
Other
($)(2)
​​
Total
($)
​
Hervé Hoppenot
Termination without cause or constructive termination
Death or Disability
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​4,919,833​​​​​19,422​​​​​3,458,233​​​​​364,447​​​​​8,761,935​​
​​���—​​​​​—​​​​​2,994,163​​​​​314,447​​​​​3,308,610​​
Christiana Stamoulis
Termination without cause or constructive termination
Death or Disability
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​908,460​​​​​12,490​​​​​518,055​​​​​46,588​​​​​1,485,593​​
​​​—​​​​​—​​​​​518,055​​​​​46,588​​​​​564,643​​
Steven Stein
Termination without cause or constructive termination
Death or Disability
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​—​​​​​—​​​​​518,055​​​​​61,221​​​​​579,276​​
​​​—​​​​​—​​​​​518,055​​​​​61,221​​​​​579,276​​
Barry Flannelly
Termination without cause or constructive termination
Death or Disability
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​—​​​​​—​​​​​518,055​​​​​51,046​​​​​569,101​​
​​​—​​​​​—​​​​​518,055​​​​​51,046​​​​​569,101​​
Maria E. Pasquale
Termination without cause or constructive termination
Death or Disability
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​—​​​​​—​​​​​518,055​​​​​15,761​​​​​533,816​​
​​​—​​​​​—​​​​​518,055​​​​​15,761​​​​​533,816​​
​
(1)
Represents the amount by which the $73.40 closing price of our common stock on December 31, 2021 exceeded the exercise price for stock options for which vesting would have accelerated as a result of termination of employment and $73.40 multiplied by the number of RSUs and performance shares for which vesting would have accelerated as a result of termination of employment.
​
(2)
Includes accrued amounts under other of the Company’s benefits arrangements, including accrued vacation and other vested benefits the named executive officer is entitled to receive that are generally available to all salaried employees.
​
(1)​

Represents the amount by which the $63.59 closing price of our common stock on December 31, 2018 exceeded the exercise price for equity awards for which vesting would have accelerated as a result of termination of employment.

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Proxy Statement 2019 2022| 5569
​

TABLE OF CONTENTS
​
Executive Compensation​

(2)

Includes accrued amounts under other of the Company’s benefits arrangements, including accrued vacation and other vested benefits the named executive officer is entitled to receive that are generally available to all salaried employees.

Potential Payments Upon Termination in Connection with a Change in Control

The following table describes the potential payments and benefits triggered by a termination of employment of a named executive officer in connection with a change in control, by the Company without cause or by the executive for good reason, in each case assuming the employment of the named executive officer was terminated on December 31, 2018.

  Termination Cash
Payment ($)		  Medical/
Insurance
Benefits ($)		  Acceleration
of Equity
Awards ($)(1)		  Other ($)(2)  Total ($) 

Hervé Hoppenot

     

Termination without cause or

for good reason(3)

  8,418,499   100,930   7,849,359   236,025   16,604,813 

Steven H. Stein

     

Termination without cause or

for good reason(3)

  2,036,876   6,838   4,103,018   40,385   6,187,117 

Wenqing Yao

     

Termination without cause or

for good reason(3)

  1,845,000   32,447   4,103,018   53,481   6,033,946 

Maria E. Pasquale

     

Termination without cause or

for good reason(3)

  1,750,000   33,734   790,106   —   2,573,840 

2021.
Termination​​
Cash
Payment
($)
​​
Medical/​
Insurance
Benefits
($)
​​
Acceleration
of Equity
Awards
($)(1)
​​
Other
($)(2)
​​
Total
($)
​
Hervé Hoppenot
Termination without cause or for good
reason(3)
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​8,740,201​​​​​68,570​​​​​14,912,523​​​​​364,447​​​​​24,085,741​​
Christiana Stamoulis
Termination without cause or for good
reason(3)
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​2,264,742​​​​​12,490​​​​​4,576,490​​​​​46,588​​​​​6,900,310​​
Steven H. Stein
Termination without cause or for good
reason(3)
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​2,330,652​​​​​36,869​​​​​10,209,015​​​​​61,221​​​​​12,637,757​​
Barry P. Flannelly
Termination without cause or for good
reason(3)
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​1,943,319​​​​​35,980​​​​​5,053,510​​​​​51,046​​​​​7,083,855​​
Maria E. Pasquale
Termination without cause or for good
reason(3)
​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​2,043,084​​​​​35,985​​​​​3,874,011​​​​​15,761​​​​​5,968,841​​
​
(1)
Represents the amount by which the $73.40 closing price of our common stock on December 31, 2021 exceeded the exercise price for stock options for which vesting would have accelerated as a result of termination of employment and $73.40 multiplied by the number of RSUs and performance shares for which vesting would have accelerated as a result of termination of employment.
​
(2)
Includes accrued amounts under other of the Company’s benefits arrangements, including accrued vacation and other vested benefits the named executive officer is entitled to receive that are generally available to all salaried employees.
​
(3)
Includes constructive termination following a change in control. See the section entitled “Employment Contracts, Termination of Employment and Change-in-Control Arrangements—Agreements with Other Named Executive Officers” above.
​
(1)​

Represents the amount by which the $63.59 closing price of our common stock on December 31, 2018 exceeded the exercise price for stock options for which vesting would have accelerated as a result of termination of employment and $63.59 multiplied by the number of RSUs for which vesting would have accelerated as a result of termination of employment.

(2)

Includes accrued amounts under other of the Company’s benefits arrangements, including accrued vacation and other vested benefits the named executive officer is entitled to receive that are generally available to all salaried employees.

(3)

Includes constructive termination following a change in control. See the section entitled “Employment Contracts, Termination of Employment and

Change-in-Control70 Arrangements—Agreements with Other Named Executive Officers” above.

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TABLE OF CONTENTS
​
Executive Compensation​

20182021 Outstanding Equity Awards at FiscalYear-End

   Option Awards    Stock Awards 
  Name Grant Date  

Number of

Securities

Underlying

Unexercised

Options (#)

Exercisable
(1)

  

Number of

Securities

Underlying

Unexercised

Options (#)

Un-Exercisable

  Option
Exercise
Price ($)		  

Option

Expiration

Date

     Number
of Shares
or Units
of Stock
That Have
Not
Vested (#)		     Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested
($)(2)		  

Equity
Incentive
Plan

Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested  (#)

  Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or  Other
Rights That
Have Not
Vested ($)		 

Hervé Hoppenot

  01/13/2014        66,666 (3)    4,239,291   
  01/21/2014   124,148   —   64.55   01/20/2021       
  01/08/2015   89,771   —   73.21   01/07/2022       
  **01/07/2016   —   20,195   95.76   01/06/2023       
  01/07/2016   73,050   2,088   95.76   01/06/2023       
  01/07/2016        10,442 (4)    664,007   
  *07/15/2016   44,856   29,389   83.83   07/14/2026       
  07/15/2016        10,802 (5)    686,899   
  ***01/17/2017   44,856   29,389   113.64   01/16/2027       
  **01/17/2017   —   94,325   113.64   01/16/2027       
  07/05/2017        10,260 (5)    652,433   
  *07/05/2017   16,705   30,463       128.34   07/04/2027       
  ***01/23/2018   16,705   30,463   94.63   01/22/2028       
  **01/24/2018   —   25,401   95.34   01/23/2028       
  *07/02/2018   —   88,557   68.62   07/01/2028       
  07/02/2018           25,267 (6)   1,606,729  (7) 
  

 

 

  

 

 

     

 

 

   

 

 

  

 

 

  

 

 

 
         410,091               350,270      98,171    6,242,630   25,267   1,606,729 
  

 

 

  

 

 

     

 

 

   

 

 

  

 

 

  

 

 

 

David W.

Gryska(8)

  10/31/2014   12,459   —   67.06   03/31/2019       
  01/08/2015   4,190   —   73.21   03/31/2019       
  01/07/2016   18,262   —   95.76   03/31/2019       
  *07/15/2016   4,773   —   83.83   03/31/2019       
  ***01/17/2017   11,533   —   113.64   03/31/2019       
  *07/05/2017   4,295   —   128.34   03/31/2019       
  ***01/23/2018   4,295   —   94.63   03/31/2019       
   

 

 

  

 

 

              
   59,807   —         
  

 

 

  

 

 

         

Steven H. Stein

  03/02/2015   10,876   —   88.68   03/01/2022       
  01/07/2016   8,348   522   95.76   01/06/2023       
  **01/07/2016   —   4,039   95.76   01/06/2023       
  01/07/2016        2,610 (4)    165,970   
  *07/15/2016   6,364   7,558   83.83   07/14/2026       
  07/15/2016        2,778 (5)    176,653   
  ***01/17/2017   11,533   7,558   113.64   01/16/2027       
  **01/17/2017   —   18,865   113.64   01/16/2027       
  07/05/2017        2,638 (5)    167,750   
  *07/05/2017   4,295   7,833   128.34   07/04/2027       
  ***01/23/2018   4,295   7,833   94.63   01/22/2028       
  **01/24/2018   —   21,167   95.34   01/23/2028       
  06/28/2018           50,000 (9)   3,179,500 (10) 
  *07/02/2018   —   22,772   68.62   07/01/2028       
  07/02/2018           6,497 (6)   413,144 (7) 
  

 

 

  

 

 

     

 

 

   

 

 

  

 

 

  

 

 

 
   45,711   98,147      8,026    510,373   56,497   3,592,644 
   

 

 

  

 

 

      

 

 

   

 

 

  

 

 

  

 

 

 

​​​​​​​​​Option Awards​​Stock Awards​
Name​​Grant Date​​
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
(1)
​​
Number of
Securities
Underlying
Unexercised
Options (#)
Un-Exercisable
​​
Option
Exercise
Price
($)
​​
Option
Expiration
Date
​​
Number
of Shares
or Units
of Stock
That Have
Not
Vested
(#)
​​
Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested
($)(2)
​​
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
(#)
​​
Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
​
Hervé Hoppenot​​​​**01/07/2016​​​​​20,195​​​​​—​​​​​95.76​​​​​01/06/2026​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/07/2016​​​​​75,138​​​​​—​​​​​95.76​​​​​01/06/2023​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/15/2016​​​​​74,245​​​​​—​​​​​83.83​​​​​07/14/2026​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/17/2017​​​​​74,245​​​​​—​​​​​113.64​​​​​01/16/2027​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​**01/17/2017​​​​​94,325​​​​​—​​​​​113.64​​​​​01/16/2027​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/05/2017​​​​​47,168​​​​​—​​​​​128.34​​​​​07/04/2027​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/23/2018​​​​​47,168​​​​​—​​​​​94.63​​​​​01/22/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​**01/24/2018​​​​​—​​​​​25,401​​​​​95.34​​​​​01/23/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/02/2018​​​​​75,642​​​​​12,915​​​​​68.62​​​​​07/01/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2018​​​​​​​​​​​​​​​​​​​​​​​​​​​​​5,242(4)​​​​​384,763​​​​​​​​​​​​​​
​​​***01/04/2019​​​​​75,643​​​​​12,915​​​​​72.27​​​​​01/03/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​19,824(3)​​​​​1,455,082​​​​​​​​​​​​​​
​​​*07/02/2019​​​​​58,197​​​​​38,130​​​​​85.01​​​​​07/01/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​20,180(4)​​​​​1,481,212​​​​​​​​​​​​​​
​​​***01/17/2020​​​​​58,198​​​​​38,130​​​​​80.50​​​​​01/16/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​29,295(3)​​​​​2,150,253​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​9,452(5)​​​​​693,777​​​​​29,607(6)​​​​​2,173,154(8)​​
​​​*07/02/2020​​​​​26,463​​​​​48,257​​​​​106.47​​​​​07/01/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/15/2021​​​​​26,463​​​​​48,257​​​​​90.56​​​​​01/14/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​13,279(5)​​​​​974,679​​​​​30,985(7)​​​​​2,274,299(8)​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​44,264(3)​​​​​3,248,978​​​​​​​​​​​​​​
​​​*07/02/2021​​​​​—​​​​​84,851​​​​​83.58​​​​​07/01/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​​​​​​​753,090​​​​​308,856​​​​​​​​​​​​​​​​​141,536​​​​​10,388,744​​​​​60,592​​​​​4,447,453​​
​​​
Christiana Stamoulis​​​​02/11/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​5,143(3)​​​​​377,496​​​​​​​​​​​​​​
​​​*02/11/2019​​​​​51,572​​​​​21,237​​​​​80.21​​​​​02/11/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​02/11/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​3,201(3)​​​​​234,953​​​​​​​​​​​​​​
​​​*02/11/2020​​​​​15,693​​​​​18,547​​​​​76.14​​​​​02/11/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​4,996(3)​​​​​366,706​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,611(5)​​​​​118,247​​​​​5,050(6)​​​​​370,670(8)​​
​​​*07/02/2020​​​​​4,512​​​​​8,231​​​​​106.47​​​​​07/01/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/15/2021​​​​​4,512​​​​​8,231​​​​​90.56​​​​​01/14/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​11,522(10)​​​​​845,715​​​​​​​​​​​​​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​2,355(5)​​​​​172,857​​​​​5,498(7)​​​​​403,553(8)​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853(3)​​​​​576,410​​​​​​​​​​​​​​
​​​*07/02/2021​​​​​—​​​​​15,054​​​​​83.58​​​​​07/01/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​15,121(11)​​​​​1,109,881​​
​​​​​​​​​76,289​​​​​71,300​​​​​​​​​​​​​​​​​36,681​​​​​2,692,384​​​​​25,669​​​​​1,884,104​​
​
​
[MISSING IMAGE: lg_incytenew-4c.jpg]
LOGO​​
Proxy Statement 2019 2022| 5771
​

TABLE OF CONTENTS
​
Executive Compensation

   Option Awards    Stock Awards 
  Name Grant Date  

Number of

Securities

Underlying

Unexercised

Options (#)

Exercisable
(1)

  

Number of

Securities

Underlying

Unexercised

Options (#)

Un-Exercisable

  Option
Exercise
Price ($)		  

Option

Expiration

Date

     Number
of Shares
or Units
of Stock
That Have
Not
Vested (#)		     Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested
($)(2)		  

Equity
Incentive
Plan

Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested  (#)

  Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or  Other
Rights That
Have Not
Vested ($)		 

Reid M.

  01/21/2014   22,070   —   64.55   11/30/2019       

Huber(11)

  01/08/2015   21,545   —   73.21   11/30/2019       
  01/07/2016   17,740   —   95.76   11/30/2019       
  *07/15/2016   11,136   —   83.83   11/30/2019       
  ***01/17/2017   11,136   —   113.64   11/30/2019       
  *07/05/2017   4,042   —   128.34   11/30/2019       
  ***01/23/2018   4,042   —   94.63   11/30/2019       
   

 

 

  

 

 

              
   91,711   —         
  

 

 

  

 

 

         

Wenqing Yao

  01/19/2012   25,354   —   17.79   01/18/2019       
  02/09/2013   62,542   —   18.32   02/08/2020       
  01/21/2014   16,553   —   64.55   01/20/2021       
  01/08/2015   21,545   —   73.21   01/07/2022       
  **01/08/2015   —   20,000   73.21   01/07/2022       
  01/07/2016        2,610 (4)    165,970   
  **01/07/2016   —   13,631   95.76   01/06/2023       
  01/07/2016   18,262   522   95.76   01/06/2023       
  *07/15/2016   11,533   7,558   83.83   07/14/2026       
  07/15/2016        2,778 (5)    176,653   
  ***01/17/2017   11,533   7,558       113.64   01/16/2027       
  **01/17/2017   —   18,865   113.64   01/16/2027       
  07/05/2017        2,638 (5)    167,750   
  *07/05/2017   4,295   7,833   128.34   07/04/2027       
  ***01/23/2018   4,295   7,833   94.63   01/22/2028       
  **01/24/2018   —   21,167   95.34   01/23/2028       
  06/28/2018           50,000 (9)   3,179,500 (10) 
  *07/02/2018   —   22,772   68.62   07/01/2028       
  07/02/2018           6,497 (6)   413,144  (7) 
  

 

 

  

 

 

     

 

 

   

 

 

  

 

 

  

 

 

 
         175,912               127,739      8,026        510,373   56,497   3,592,644 
  

 

 

  

 

 

     

 

 

   

 

 

  

 

 

  

 

 

 

Maria E. Pasquale(12)

  *04/09/2018   —   41,193   65.36   04/09/2028       
  04/09/2018        5,928 (6)    376,962   
  *07/02/2018   —   22,772   68.62   07/01/2028       
  07/02/2018           6,497 (6)   413,144  (7) 
   

 

 

  

 

 

       

 

 

    

 

 

  

 

 

  

 

 

 
       —   63,965               5,928       376,962   6,497   413,144 

(1)

All options listed in this table, other than those marked with an asterisk (*), a double asterisk (**) or a triple asterisk (***), become exercisable as toone-third of the shares on the first anniversary of the date of grant, with the remaining shares vesting ratably on a monthly basis thereafter over the following two years, and have a term of seven years, subject to earlier termination in certain events relating to termination of employment. Options marked with an asterisk become exercisable as toone-fourth of the shares on the first anniversary of the date of grant, with the remaining shares vesting ratably on a monthly basis thereafter over the following three years, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Options marked with a double asterisk become exercisable as to all of the shares on the fourth anniversary of the date of grant, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Options marked with a triple asterisk become exercisable as toone-fourth of the shares on the first anniversary of the grant date in July of the preceding year with the remaining shares vesting ratably on a monthly basis thereafter over the following three years, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Vesting of all options listed in this table is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements.”

58 | Proxy Statement 2019LOGO​

​​​​​​​​​Option Awards​​Stock Awards​
Name​​Grant Date​​
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
(1)
​​
Number of
Securities
Underlying
Unexercised
Options (#)
Un-Exercisable
​​
Option
Exercise
Price
($)
​​
Option
Expiration
Date
​​
Number
of Shares
or Units
of Stock
That Have
Not
Vested
(#)
​​
Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested
($)(2)
​​
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
(#)
​​
Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
​
Steven Stein​​​​01/07/2016​​​​​8,870​​​​​—​​​​​95.76​​​​​01/06/2023​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​**01/07/2016​​​​​4,039​​​​​—​​​​​95.76​​​​​01/06/2026​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/15/2016​​​​​1,194​​​​​—​​​​​83.83​​​​​07/14/2026​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/17/2017​​​​​19,091​​​​​—​​​​​113.64​​​​​01/16/2027​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​**01/17/2017​​​​​18,865​​​​​—​​​​​113.64​​​​​01/16/2027​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/05/2017​​​​​12,128​​​​​—​​​​​128.34​​​​​07/04/2017​​​​​​​​​​​​​​​​​​​​​​​���​​
​​​***01/23/2018​​​​​12,128​​​​​—​​​​​94.63​​​​​01/22/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​**01/24/2018​​​​​​​​​​​21,167​​​​​95.34​​​​​01/23/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/02/2018​​​​​5,219​​​​​3,321​​​​​68.62​​​​​07/01/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2018​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,348(4)​​​​​98,943​​​​​​​​​​​​​​
​​​***01/04/2019​​​​​3,321​​​​​9,014​​​​​72.27​​​​​01/03/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​04/29/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​25,000(9)​​​​​1,835,000​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​3,381(3)​​​​​248,165​​​​​​​​​​​​​​
​​​*07/02/2019​​​​​9,925​​​​​6,503​​​​​85.01​​​​​07/01/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​3,441(4)​​​​​252,569​​​​​​​​​​​​​​
​​​***01/17/2020​​​​​9,925​​​​​6,503​​​​​80.50​​​​​01/16/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​4,996(3)​​​​​366,706​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,611(5)​​​​​118,247​​​​​5,050(6)​​​​​370,670(8)​​
​​​*07/02/2020​​​​​4,512​​​​​8,231​​​​​106.47​​​​​07/01/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/15/2021​​​​​4,512​​​​​8,231​​​​​90.56​​​​​01/14/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​23,044(10)​​​​​1,691,430​​​​​​​​​​​​​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​2,355(5)​​​​​172,857​​​​​5,498(7)​​​​​403,553(8)​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853(3)​​​​​576,410​​​​​​​​​​​​​​
​​​*07/02/2021​​​​​—​​​​​15,054​​​​​83.58​​​​​07/01/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​30,243(11)​​​​​2,219,836​​
​​​​​​​​​113,729​​​​​78,024​​​​​​​​​​​​​​​​​73,029​​​​​5,360,327​​​​​40,791​​​​​2,994,059​​
 ​
​
    Executive Compensation    

(2)

The market value of unvested RSUs is calculated by multiplying the number of unvested RSUs held by the applicable named executive officer by $63.59, the closing price of our common stock on December 31, 2018.

(3)

In connection with the commencement of his employment as our CEO in January 2014, Mr. Hoppenot was awarded a

one-time72 grant of 400,000 RSUs, withone-sixth| vesting at the end of each of the calendar years 2014 through 2019 subject to Mr. Hoppenot’s continued employment and subject to acceleration of vesting upon certain events in accordance with the terms of his employment agreement, as described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements.”

(4)

RSUs that vest in full on the third anniversary of the grant date, subject to the holder’s continued service through such date. Vesting of the RSUs is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements.”

(5)

RSUs that vest in equal installments on each of the first four anniversaries of the grant date, subject to the holder’s continued service through such dates. Vesting of the RSUs is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment andChange-in-Control Arrangements.”

(6)

Represents the target number of shares of common stock underlying performance shares that can be earned based upon the achievement of revenue based performance criteria. The actual number of number of shares of common stock into which each performance share award may convert will be calculated by multiplying the target number of performance shares allocated to that award by performance percentage multipliers ranging from 0% to 150% based on the actual level at which the applicable revenue-based performance goal is achieved, as certified by the Compensation Committee. The earned performance shares will vest in equal installments on each of the first four anniversaries of the grant date of July 2, 2018.

(7)

The market value of unearned and unvested performance shares assumes achievement of the performance goals at the target level of 100% and is calculated by multiplying the number of unearned and unvested target shares held by the applicable named executive officer by $63.59, the closing price of our common stock on December 31, 2018.

(8)

Mr. Gryska resigned as Executive Vice President and Chief Financial Officer effective December 2018.

(9)

Represents shares of common stock underlying performance shares that become earned only if a specified number of investigational new drug (IND) filings are made during a specified time frame. If earned, the shares would vest on the third anniversary of the initial grant date.

(10)

The market value of unearned and unvested performance shares is calculated by multiplying the number of unearned and unvested target shares held by the applicable named executive officer by $63.59, the closing price of our common stock on December 31, 2018.

(11)

Dr. Huber resigned as Executive Vice President and Chief Scientific Officer effective November 2018.

(12)

Ms. Pasquale was appointed Executive Vice President and General Counsel effective April 2018.

LOGOProxy Statement 2019 2022| 59​​
[MISSING IMAGE: lg_incytenew-4c.jpg]
​

TABLE OF CONTENTS
​
Executive Compensation​

​​​​​​​​​Option Awards​​Stock Awards​
Name​​Grant Date​​
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
(1)
​​
Number of
Securities
Underlying
Unexercised
Options (#)
Un-Exercisable
​​
Option
Exercise
Price
($)
​​
Option
Expiration
Date
​​
Number
of Shares
or Units
of Stock
That Have
Not
Vested
(#)
​​
Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested
($)(2)
​​
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
(#)
​​
Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)
​
Barry P. Flannelly​​​​**01/07/2016​​​​​4,039​​​​​—​​​​​95.76​​​​​01/06/2026​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/07/2016​​​​​18,784​​​​​—​​​​​95.76​​​​​01/06/2023​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/15/2016​​​​​19,091​​​​​—​​​​​83.83​​​​​07/14/2026​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/17/2017​​​​​19,091​​​​​—​​​​​113.64​​​​​01/16/2027​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/05/2017​​​​​12,128​​​​​—​​​​​128.34​​​​​07/04/2027​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/23/2018​​​​​12,128​​​​​—​​​​​94.63​​​​​01/22/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​*07/02/2018​​​​​19,451​​​​​3,321​​​​​68.62​​​​​07/01/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2018​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,348(4)​​​​​98,943​​​​​​​​​​​​​​
​​​***01/04/2019​​​​​19,451​​​​​3,321​​​​​72.27​​​​​01/03/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​**01/04/2019​​​​​​​​​​​63,105​​​​​72.27​​​​​01/03/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​3,381(3)​​​​​248,165​​​​​​​​​​​​​​
​​​*07/02/2019​​​​​9,925​​​​​6,503​​​​​85.01​​​​​07/01/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​3,441(4)​​​​​252,569​​​​​​​​​​​​​​
​​​01/17/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​11,482(10)​​​​​842,779​​​​​​​​​​​​​​
​​​***01/17/2020​​​​​9,925​​​​​6,503​​​​​80.50​​​​​01/16/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​4,996(3)​​​​​366,706​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,611(5)​​​​​118,247​​​​​5,050(6)​​​​​370,670(8)​​
​​​*07/02/2020​​​​​4,512​​​​​8,231​​​​​106.47​​​​​07/01/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/15/2021​​​​​4,512​​​​​8,231​​​​​90.56​​​​​01/14/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​01/15/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​11,522(10)​​​​​845,715​​​​​​​​​​​​​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​2,355(5)​​​​​172,857​​​​​5,498(7)​​​​​403,553(8)​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853(3)​​​​​576,410​​​​​​​​​​​​​​
​​​*07/02/2021​​​​​—​​​​​15,054​​​​​83.58​​​​​07/01/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​9,073(11)​​​​​665,958​​
​​​​​​​​​153,037​​​​​114,269​​​​​​​​​​​​​​​​​47,989​​​​​3,522,391​​​​​19,621​​​​​1,440,181​​
​​​
Maria E. Pasquale​​​​*04/09/2018​​​​​11,344​​​​​3,433​​​​​65.36​​​​​04/08/2028​​​​​​​​​​​​​​​​​​​​​
​​​04/09/2018​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,482(3)​​​​​108,779​​​​​​​​​​​​​​
​​​*07/02/2018​​​​​7,117​​​​​3,321​​​​​68.62​​​​​07/01/2028​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2018​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,348(4)​​​​​98,943​​​​​​​​​​​​​​
​​​***01/04/2019​​​​​8,540​​​​​3,321​​​​​72.27​​​​​01/03/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​3,381(3)​​​​​248,165​​​​​​​​​​​​​​
​​​*07/02/2019​​​​​9,925​​​​​6,503​​​​​85.01​​​​​07/01/2029​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2019​​​​​​​​​​​​​​​​​​​​​​​​​​​​​3,441(4)​​​​​252,569​​​​​​​​​​​​​​
​​​***01/17/2020​​​​​9,925​​​​​6,503​​​​​80.50​​​​​01/16/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​1,611(5)​​​​​118,247​​​​​5,050(6)​​​​​370,670(8)​​
​​​07/02/2020​​​​​​​​​​​​​​​​​​​​​​​​​​​​​4,996(3)​​​​​366,706​​​​​​​​​​​​​​
​​​*07/02/2020​​​​​4,512​​​​​8,231​​​​​106.47​​​​​07/01/2030​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​***01/15/2021​​​​​4,512​​​​​8,231​​​​​90.56​​​​​01/14/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​2,355(5)​​​​​172,857​​​​​5,498(7)​​​​​403,553(8)​​
​​​07/02/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​7,853(3)​​​​​576,410​​​​​​​​​​​​​​
​​​*07/02/2021​​​​​—​​​​​15,054​​​​​83.58​​​​​07/01/2031​​​​​​​​​​​​​​​​​​​​​​​​​​
​​​12/01/2021​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​15,121(11)​​​​​1,109,881​​
​​​​​​​​​55,875​​​​​54,597​​​​​​​​​​​​​​​​​26,467​​​​​1,942,676​​​​​25,669​​​​​1,884,104​​
​
​
2018(1)
All options listed in this table, other than those marked with an asterisk (*), a double asterisk (**) or a triple asterisk (***), become exercisable as to one-third of the shares on the first anniversary of the date of grant, with the remaining shares vesting ratably on a monthly basis thereafter over the following two years, and have a term of seven years, subject to earlier termination in certain events relating to termination of employment. Options marked with an asterisk become exercisable as to one-fourth of the shares on the first anniversary of the date of grant, with the remaining shares vesting ratably on a monthly basis thereafter over the following three years, and have a term of ten years, subject to earlier termination in
​
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​Executive Compensation​
certain events relating to termination of employment. Options marked with a double asterisk become exercisable as to all of the shares on the fourth anniversary of the date of grant, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Options marked with a triple asterisk become exercisable as to one-fourth of the shares on the first anniversary of the grant date in July of the preceding year with the remaining shares vesting ratably on a monthly basis thereafter over the following three years, and have a term of ten years, subject to earlier termination in certain events relating to termination of employment. Vesting of all options listed in this table is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
(2)
The market value of unvested RSUs and earned performance shares is calculated by multiplying the number of unvested shares held by the applicable named executive officer by $73.40, the closing price of our common stock on December 31, 2021.
​
(3)
RSUs that vest in equal installments on each of the first four anniversaries of the grant date, subject to the holder’s continued service through such dates. Vesting of the RSUs is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
(4)
Represents the number of shares of common stock underlying performance shares that were earned based upon the achievement of revenue based performance criteria. The earned performance shares will vest in equal installments on each of the first four anniversaries of the grant date, subject to the holder’s continued service through such dates. Vesting of the performance shares is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
(5)
Represents shares of common stock underlying performance shares earned upon the interim achievement of performance criteria determined to be satisfied on November 19, 2021. The earned shares will vest on the third anniversary of the respective July 2, 2020 and July 2, 2021 grant dates, subject to the holder’s continued service through the respective date. Vesting of the performance shares is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
(6)
Represents the remaining target number of shares of common stock underlying performance shares that can be earned based upon the achievement of specified development and revenue-based performance goals. The actual number of shares of common stock into which each performance share award may convert will be calculated by multiplying the target number of performance shares allocated to that award by performance percentage multipliers ranging from 0% to 175% based on the actual level at which the applicable specified development and revenue-based performance goals are achieved, as certified by the Compensation Committee. The shares, if earned, will vest on the third anniversary of the July 2, 2020 grant date, subject to the holder’s continued service through such date. Vesting of the performance shares is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
(7)
Represents the remaining target number of shares of common stock underlying performance shares that can be earned based upon the achievement of specified development, revenue and market-based (relative total shareholder returns compared to the Nasdaq Biotechnology Index) performance goals. The actual number of shares of common stock into which each performance share award may convert will be calculated by multiplying the target number of performance shares allocated to that award by performance percentage multipliers ranging from 0% to 150% based on the actual level at which the applicable performance goals are achieved, as certified by the Compensation Committee. The shares, if earned, will vest on the third anniversary of the July 2, 2021 grant date, subject to the holder’s continued service through such date. Vesting of the performance shares is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
(8)
The market value of unearned and unvested performance shares assumes achievement of the performance goals at the target level of 100% and is calculated by multiplying the number of unearned and unvested target shares held by the applicable named executive officer by $73.40, the closing price of our common stock on December 31, 2021.
​
(9)
Represents the number of shares of common stock underlying performance shares that were earned based upon the achievement of a specified number of new chemical entities approved by regulatory authorities. The earned performance shares will vest in full on June 28, 2022, subject to the holder’s continued service through such dates. Vesting of the performance shares is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
(10)
Represents RSUs that vest on the fourth anniversary of the grant date, subject to the holder’s continued service through such date. Vesting of the RSUs is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
(11)
Represents the number of shares of common stock underlying performance shares that can be earned based upon the achievement of specified Opzelura performance goals. The actual number of shares of common stock into which each performance share award may convert will be calculated by multiplying the target number of performance shares allocated to that award by performance percentage multipliers ranging from 0% to 150% based on the actual level at which the applicable performance goals are achieved, as certified by the Compensation Committee. The shares, if earned, will vest on November 30, 2025, subject to the holder’s continued service through such date. Vesting of the performance shares is subject to acceleration under the circumstances described under “Employment Contracts, Termination of Employment and Change-in-Control Arrangements.”
​
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​Executive Compensation​
2021 Option Exercises and Stock Vested Table

   Option Awards    Stock Awards
  Name  Number of Shares
Acquired on
Exercise (#)		  Value Realized
on Exercise ($)(1)		    Number of Shares
Acquired on
Vesting (#)		   Value Realized  
  on Vesting ($)(2)  

Hervé Hoppenot

    —   $—              88,079 (3)  $    7,431,197

David W. Gryska(4)

    6,760   $        101,696      5,290 (5)  $417,495

Steven H. Stein

    —   $—      8,751 (6)  $719,005

Reid M. Huber(7)

    —   $—      5,290 (8)  $417,495

Wenqing Yao

    —   $—      5,290 (9)  $417,495

Maria E. Pasquale(10)

    —   $—      —  $—

​​​Option Awards​​Stock Awards​
Name​​
Number of Shares
Acquired on
Exercise
(#)
​​
Value Realized
on Exercise
($)(1)
​​
Number of Shares
Acquired on
Vesting
(#)
​​
Value Realized
on Vesting
($)(2)
​
Hervé Hoppenot​​​​—​​​​​—​​​​​38,429(3)​​​​​3,211,075​​
Christiana Stamoulis​​​​—​​​​​—​​​​​5,303(4)​​​​​448,354​​
Steven H. Stein​​​​3,795​​​​​119,087​​​​​57,302(5)​​​​​4,890,590​​
Barry P. Flannelly​​​​—​​​​​—​​​​​7,302(6)​​​​​610,090​​
Maria E. Pasquale​​​​1,146​​​​​16,129​​​​​7,904(7)​​​​​655,251​​
​
(1)
Value realized is based on the fair market value of our common stock on the date of exercise minus the exercise price and does not necessarily reflect proceeds actually received by the individual.
​
(2)
Value realized is based on the fair market value of our common stock on the vesting date and does not necessarily reflect proceeds actually received by the individual.
​
(3)
Represents 38,429 shares received upon vesting of RSUs, of which 17,651 shares were automatically withheld to cover tax withholding obligations.
​
(4)
Represents 5,303 shares received upon vesting of RSUs, of which 1,726 shares were automatically withheld to cover tax withholding obligations.
​
(5)
Represents 57,302 shares received upon vesting of RSUs, of which 25,434 shares were automatically withheld to cover tax withholding obligations.
​
(6)
Represents 7,302 shares received upon vesting of RSUs, of which 2,263 shares were automatically withheld to cover tax withholding obligations.
​
(7)
Represents 7,904 shares received upon vesting of RSUs, of which 2,758 shares were automatically withheld to cover tax withholding obligations.
​
(1)​

Value realized is based on the fair market value of our common stock on the date of exercise minus the exercise price and does not necessarily reflect proceeds actually received by the individual.

(2)
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Value realized is based on the fair market value of our common stock on the vesting date and does not necessarily reflect proceeds actually received by the individual.

(3)​

Represents 88,079 shares received upon vesting of RSUs, of which 41,205 shares were automatically withheld to cover tax withholding obligations.

(4)​

Mr. Gryska resigned as Executive Vice President and Chief Financial Officer effective December 2018.

(5)

Represents 5,290 shares received upon vesting of RSUs, of which 1,805 shares were automatically withheld to cover tax withholding obligations.

(6)

Represents 8,751 shares received upon vesting of RSUs, of which 2,920 shares were automatically withheld to cover tax withholding obligations.

(7)

Dr. Huber resigned as Executive Vice President and Chief Scientific Officer effective November 2018.

(8)

Represents 5,290 shares received upon vesting of RSUs, of which 1,796 shares were automatically withheld to cover tax withholding obligations.

(9)

Represents 5,290 shares received upon vesting of RSUs, of which 1,729 shares were automatically withheld to cover tax withholding obligations.

(10)

Ms. Pasquale was appointed Executive Vice President and General Counsel effective April 2018.

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TABLE OF CONTENTS​
CEO Pay Ratio
​
As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K we are providing the following information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Hoppenot, our CEO. The pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K.
For 2021, our last completed fiscal year:
•
the median of the annualized total compensation of all employees of our Company (other than our CEO), was $248,810; and
​
•
the annual total compensation of our CEO, as reported in the Summary Compensation Table presented elsewhere in this Proxy Statement, was $14,444,265.
​
Based on this information, for 2021 the ratio of the annual total compensation of
Mr. Hoppenot, our CEO, to the median of the annual total compensation of all
employees was 58 to 1.
To identify the median of the annual total compensation of all our employees, as well as to determine the annual total compensation of the “median employee,” the methodology and the material assumptions, adjustments, and estimates that we used were as follows:
•
We determined that, as of December 31, 2021, our employee population consisted of 2,093 employees other than Mr. Hoppenot, with 1,578 based in North America, 459 based in Europe and 56 based in Asia.
​
•
We selected December 31, 2021, which is within the last three months of 2021, as the date upon which we would identify the “median employee.”
​
•
For all employees, we examined total compensation, which included: base salary, incentive compensation plan payments for non-sales employees, sales incentive compensation plan payments for sales employees, equity awards consisting of stock options and restricted stock units, and other compensation such as 401(k) matching contributions and Company-paid life insurance premiums.
​
•
We included all employees, whether employed on a full-time or part-time basis, and we annualized the compensation of all permanent employees who were not employed by us for all of 2021.
​
•
We did not make any cost-of-living adjustments in identifying the “median employee.”
​
•
For employees outside the United States, we converted their compensation to U.S. dollars using the relevant average exchange rate for 2021.
​
​
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Equity Compensation Plan Information

​
The following table gives information about our common stock that may be issued upon the exercise of options, warrants and rights under all of our existing equity compensation plans as of December 31, 2018,2021, including the 1993 Directors’ Stock Option Plan, the 1997 Employee Stock Purchase Plan and the 2010 Stock Incentive Plan.

 Number of securities to
be issued upon exercise
of  outstanding
options, warrants and
rights		 Weighted-average
exercise price of
outstanding options,
warrants and  rights
($)		   Number of securities remaining  
  available for  future issuance  
  under equity compensation  
  plans (excluding securities  
  reflected in column (a))  
  Plan Category(a) (b)   (c)  

Equity compensation plans approved by security holders

 14,481,691 (1)$        74.39 (2) 7,563,654 (3)

Equity compensation plans not approved by security holders

 133,333 (4) — —

 

 

 

 

 

 

 

 

 

Total

 14,615,024$        74.39 7,563,654

​​​
Number of securities to
be issued upon exercise
of outstanding
options, warrants and
rights
​​
Weighted-average
exercise price of
outstanding options,
warrants and rights
($)
​​
Number of securities remaining
available for future issuance
under equity compensation
plans (excluding securities
reflected in column (a))
​
Plan Category​​(a)​​(b)​​(c)​
Equity compensation plans approved by
security holders
​​​​16,863,292(1)​​​​​88.39(2)​​​​​10,654,571(3)​​
Equity compensation plans not approved by security holders​​​​—​​​​​—​​​​​—​​
Total​​​​16,863,292​​​​​88.39​​​​​10,654,571​​
​
(1)
Includes 3,453,555 shares subject to RSUs, 260,996 shares subject to earned performance shares and 385,281 shares subject to unearned performance shares outstanding as of December 31, 2021 that were issued under the 2010 Stock Incentive Plan. The number of shares subject to such unearned performance shares represents the maximum number of shares issuable pursuant to such performance shares as of such date.
​
(2)
RSUs and performance shares, which do not have an exercise price, are excluded in the calculation of weighted-average exercise price.
​
(3)
Includes 680,975 shares available for issuance under the 1997 Employee Stock Purchase Plan and 9,969,628 shares available for issuance under the 2010 Stock Incentive Plan.
​
(1)​

Includes 1,597,893 and 598,639 shares subject to RSUs and performance shares outstanding as of December 31, 2018 that were issued under the 2010 Stock Incentive Plan. The number of shares subject to such performance shares represents the maximum number of shares issuable pursuant to such performance shares as of such date.

(2)
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RSUs and performance shares, which do not have an exercise price, are excluded in the calculation ofweighted-average exercise price.

(3)​

Includes 693,521 shares available for issuance under the 1997 Employee Stock Purchase Plan and 6,870,133 shares available for issuance under the 2010 Stock Incentive Plan. No shares remain available for future issuance under the 1993 Directors’ Stock Option Plan.

(4)​

Represents shares subject to RSUs granted outside of the 2010 Stock Incentive Plan to Hervé Hoppenot, as described under “—Employment Contracts, Termination of Employment and Change in Control Arrangements—President and CEO.”

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TABLE OF CONTENTS​
Report of the Audit and Finance Committee of the Board

​
The Audit and Finance Committee of the Board is composed of threefour directors, each of whom qualifies as “independent” under the current listing requirements of The Nasdaq Stock Market. The current members of the Audit and Finance Committee are Paul J. Clancy, Paul A. Brooke and Wendy L. Dixon.Dixon and Jacqualyn A. Fouse. The Audit and Finance Committee acts pursuant to a written charter that has been adopted by the Board. The charter is reviewed annually for changes, as appropriate.

In performing its functions, the Audit and Finance Committee acts in an oversight capacity and necessarily relies on the work and assurances of the Company’s management, which has the primary responsibility for financial statements and reports, and of the independent registered public accounting firm, who, in their report, express an opinion on the conformity of the Company’s annual financial statements with accounting principles generally accepted in the United States and the effectiveness of the Company’s internal control over financial reporting. It is not the duty of the Audit and Finance Committee to plan or conduct audits, to determine that the Company’s financial statements are complete and accurate and are in accordance with generally accepted accounting principles, or to assess or determine the effectiveness of the Company’s internal control over financial reporting.

Within this framework, the Audit and Finance Committee has reviewed and discussed with management the Company’s audited financial statements as of and for the year ended December 31, 20182021 and the Company’s internal control over financial reporting. The Audit and Finance Committee has also discussed with the independent registered public accounting firm, Ernst & Young LLP, the matters required to be discussed by Auditing Standard No. 1301, “Communications with Audit Committees,” issued bypursuant to the applicable standards of the Public Company Accounting Oversight Board. In addition, the Audit and Finance Committee has received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent registered public accounting firm’s communications with the Audit and Finance Committee concerning independence, and has discussed with the independent registered public accounting firm the independent registered public accounting firm’s independence.

Based upon these reviews and discussions, the Audit and Finance Committee recommended to the Board that the audited financial statements be included in the Company’s Annual Report onForm 10-K for the year ended December 31, 2018.

2021.

Audit and Finance Committee


Paul J. Clancy (Chair)

Paul A. Brooke


Wendy L. Dixon


Jacqualyn A. Fouse
​
62 78| Proxy Statement 2019
LOGO

Proposal 2

Advisory Vote to Approve Executive Compensation

This Proposal 2, commonly known as a“say-on-pay” proposal, provides our stockholders with the opportunity to vote to approve, on anon-binding, advisory basis, the compensation of our named executive officers as disclosed in this Proxy Statement in accordance with the compensation disclosure rules of the Securities and Exchange Commission.

As described in detail under the heading “Executive Compensation—Compensation Discussion and Analysis,” our executive compensation programs are designed to attract and retain our named executive officers, who are critical to our success. Under these programs, our named executive officers are rewarded for the achievement of annual andlong-term corporate objectives, and the creation of increased stockholder value. Please read the Compensation Discussion and Analysis for additional details about our executive compensation programs, including information about the 2018 compensation of our named executive officers.

Each year since 2011, we sought, and received, approval for our executive compensation program. In addition, in 2011, and again in 2017, we sought, and received, approval to hold a“say-on-pay” vote each year. Accordingly, we are again asking our stockholders to indicate their support for our named executive officer compensation as described in this Proxy Statement. This Proposal 2 gives our stockholders the opportunity to express their views on our named executive officers’ compensation. This vote is advisory, which means that the vote on executive compensation is not binding on the Company, our Board or the Compensation Committee of the Board. This vote is not intended to address any specific item of compensation, but rather the vote relates to the compensation of our named executive officers, as described in this Proxy Statement in accordance with the compensation disclosure rules of the Securities and Exchange Commission. Accordingly, we again will ask our stockholders to vote for the following resolution at the annual meeting:

“RESOLVED, that the Company’s stockholders approve, on anon-binding, advisory basis, the compensation of the named executive officers, as disclosed in the Company’s Proxy Statement for the 2019 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table and the other related tables and disclosure.”

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The Board recommends a vote “FOR” the Approval of Executive Compensation.

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TABLE OF CONTENTS​Proposal
PROPOSAL 3

Proposal to Amend the Amended and Restated 2010

Stock Incentive Plan

In March 2019, the Board approved amendments to the Amended and Restated 2010 Stock Incentive Plan (referred to in this proposal description as the “2010 Plan”), subject to the approval of our stockholders at the Annual Meeting, to increase the number of shares available for issuance and make certain additional changes. Incyte has continued to grow at a significant rate. As our revenue and our discovery and development pipeline have substantially increased over the last several years, so too has our number of employees. Our 2016 expansion into Europe and our 2017 expansion into Japan has also contributed to our increasing employee headcount. Even though our employee headcount has risen substantially in the last several years, including in 2018, we have carefully managed the 2010 Plan to ensure that stockholders are subject to minimal dilution and that there is as little overhang as possible on our common stock. In fact, as the chart below shows, since the 2018 amendment to the 2010 Plan that added 6,000,000 shares, our overhang percentage remains low, at 9.1%, and our

3-year average burn rate is 2.26% (assuming that each full value award equates to 2.0 shares and each stock option award equates to 1.0 share), all while our employee headcount has grown by 98% over the past three years.

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3-Year average burn rate for peer group 50th percentile is 2.8%

64 | Proxy Statement 2019LOGO

    Proposal 3 Proposal to Amend the Amended and Restated 2010 Stock Incentive Plan    

Further detail of ouryear-end overhang percentage is set forth in the table below:

Overhang Detail

   2015   2016   2017   2018 

Overhang:

        

Options and awards available for grant

   4,681,150    7,473,290    4,678,903    7,023,328 

Options and awards outstanding

   11,617,846    12,751,142    12,385,213    14,328,496 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total overhang

   16,298,996    20,224,432    17,064,116    21,351,824 
  

 

 

   

 

 

   

 

 

   

 

 

 

Common outstanding and overhang shares

   202,949,245    209,073,184    228,327,022    234,626,484 

Overhang Percentage

   8.0%    9.7%    7.5%    9.1% 

50th percentile peer group overhang is 14.1%

We believe that we have been careful stewards of the 2010 Plan and we now seek a new amendment to the 2010 Plan to add an additional 7,700,000 shares (as detailed further below) so that we will be in a position to continue our substantial growth as we seek to execute on our 2019 andlonger-term strategic goals.

The following summary of the principal features of the 2010 Plan, as amended, is qualified by reference to the terms of the plan, a copy of which is available without charge upon stockholder request to Secretary, Incyte Corporation, 1801 AugustineCut-Off, Wilmington, Delaware 19803. The 2010 Plan, as amended, has also been filed electronically with the Securities and Exchange Commission together with this Proxy Statement, and can be accessed on the SEC’s web site athttp://www.sec.gov.

Description of Amendments

The first amendment to the 2010 Plan approved by the Board and submitted for stockholder approval consists of an increase in the number of shares available for issuance thereunder by 7,700,000 shares, from 36,753,475 shares to 44,453,475 shares.

The proposed increase of 7,700,000 in the number of shares reserved for issuance under the 2010 Plan is needed to allow us to continue to provide effective and appropriate equity incentives to our growing number of employees and our directors. Our equity awards have historically consisted of stock options, RSUs and performance shares. Our Board and the Compensation Committee of the Board have believed that equity awards align compensation incentives with stockholder interests, provideat-risk compensation for management by providing them with a strong incentive to improve the Company’s performance, and provide employees with the opportunity to benefit significantly from the success of the Company. We offer equity awards to all new hires and have found that attractive and competitive initial equity awards are often an important inducement for thehigh-performing, entrepreneurial individuals who we believe are key to our success. We expect to continue to expand our workforce in support of our research and development and commercialization efforts as we execute on ourlong-term growth strategy. As we recruit to fill these new positions, the amount of shares required for initial awards to new hires, together with the amount required for annual awards to existing employees, in each case consistent with our historical practices, increases.

We do not believe the proposed 7,700,000 share increase will be unduly dilutive to stockholders. A common measure of potential dilution from outstanding equity awards is “overhang,” generally defined as equity awards outstanding but not exercised, plus equity awards available to be granted (together

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    Proposal 3 Proposal to Amend the Amended and Restated 2010 Stock Incentive Plan    

referred to as potential equity award shares), divided by the sum of total common shares outstanding plus potential equity award shares. As of March 12, 2019, our overhang was 9%, as compared with 7% as of February 28, 2018. We believe that our overhang has been reduced as a result of our equity award guidelines that were implemented in January 2014 and July 2016, pursuant to which the number of stock option awards was reduced through the use of RSUs and performance shares. For our annual awards and new employee awards beginning in July 2016, each U.S. recipient received a mix of stock options and RSUs, with the value as of the grant date of the options equal to 662/3% (75% for our executive officers), and the value of the shares underlying the RSU award equal to 331/3% (25% for our executive officers), of the aggregate value of such options and shares, in each case as determined under generally accepted accounting principles consistent with the valuation of our Company’s equity incentives. In 2018, we changed the 25% portion of our executive officer awards from RSUs to performance shares, which combine the time-based vesting aspects of RSUs with performance-based vesting requirements, and in 2019, our executive officers will receive for their annual awards a mix of 50% stock options, 25% performance shares and 25% RSUs.Non-U.S. recipients only receive RSUs.

The second amendment approved by the Board and submitted for stockholder approval would replace the current limitation of 3,500,000 shares that may be issued pursuant toso-called “full value” awards such as RSUs, restricted shares and performance shares (essentially any sales or awards of shares other than upon exercise of options or other than pursuant to sales at purchase prices at least equal to the fair market value of the shares) with a flexible or “fungible” share pool approach. Under this approach, each full value award will reduce the total share pool available under the 2010 Plan by 2.0 shares, and each stock option and any othernon-full value award will reduce the total share pool by 1.0 share for each underlying award share granted. This amendment would provide us with more flexibility to use full value awards to compensate our employees and thus reduce the potential dilution of employee awards to our stockholders, while still recognizing the differences in value of each type of award.

In addition, the Board approved an amendment to the 2010 Plan to restructure the automatic grants of equity awards to our nonemployee “outside” directors. Such directors currently receive an initial grant of options to purchase 25,000 shares at the time of their initial election to the Board, and annual grants of nonstatutory options to purchase 15,000 shares at each regular annual meeting of our stockholders, in each case subject to time-based vesting requirements. If the proposed amendment is approved by our stockholders at the Annual Meeting, the initial grants of options to purchase 25,000 shares to new outside directors would be eliminated, and the annual grants made to outside directors following the conclusion of the Annual Meeting and each future annual meeting of our stockholders would be changed from a grant of options to purchase 15,000 shares to a grant having an aggregate grant date fair value of $500,000 and entitling the recipient to receive a mix of stock options and RSUs, with the value as of the grant date of the options equal to 75% and the value of the shares underlying the RSU award equal to 25% of the aggregate grant date fair value, in each case as determined under generally accepted accounting principles consistent with the valuation of our Company’s equity incentives. The number of shares subject to the options will be determined by dividing 75% of $500,000 (or $375,000) by the Black-Scholes value of one such option, based on the average closing sale price for our shares over the 30 consecutive trading days concluding with the last trading day prior to the grant date, rounded down to the nearest whole share. The number of shares subject to the RSUs will be determined by dividing 25% of $500,000 (or $125,000) by such 30 trading day average price, rounded down to the nearest whole share. The exercise price of the options will be equal to the fair market value on the date of grant, and the options will have a term of ten years. Each outside director who is not initially elected at a regular annual meeting of our stockholders will receive awards having an aggregate grant date fair value of a pro rata portion of $500,000, determined based on the

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number of full calendar months remaining from the date of election until the next regular annual meeting divided by 12. Such outside director’s awards will consist of 75% nonstatutory options and 25% RSUs determined in a manner similar to that used for the annual awards to outside directors following the conclusion of the regular annual meeting, except that the values of the awards to such outside director will be determined as of the grant date of such awards. Under the proposed amendment, all annual awards to outside directors will vest (and, in the case of options, become exercisable) on the earlier of the first anniversary of the date of grant or immediately prior to the next regular annual meeting of our stockholders, similar to the current vesting provisions for annual awards to outside directors under the 2010 Plan.

The last amendment approved by the Board and submitted for stockholder approval is an extension of the termination date of the 2010 Plan, from March 18, 2021 to June 30, 2021. This will allow us to continue using the 2010 Plan for equity awards through the date of our annual meeting of stockholders in 2021.

2010 Stock Incentive Plan

The 2010 Plan was initially adopted by the Board in March 2010 and approved by our stockholders in May 2010. It was last amended and restated by the Board in April 2013 and our stockholders approved the amended and restated 2010 Plan in May 2013. The Board further amended the 2010 Plan in 2014, 2016 and 2018, and our stockholders approved each of those amendments.

The purpose of the 2010 Plan is to assist in the recruitment, retention and motivation of employees, outside directors and consultants who are in a position to make material contributions to ourlong-term success and the creation of stockholder value. The 2010 Plan offers a significant incentive to encourage our employees, outside directors and consultants by enabling those individuals to acquire shares of our common stock, thereby increasing their proprietary interest in the growth and success of our Company.

The 2010 Plan provides for the direct award or sale of shares of common stock (including restricted shares), the award of RSUs and stock appreciation rights, the award of performance shares and the grant of incentive stock options to purchase common stock intended to qualify for preferential tax treatment under Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), and nonstatutory stock options to purchase common stock that do not qualify for such treatment under the Code. All employees, including officers, of the Company or any subsidiary,non-employee directors of the Company and any consultant who performs services for the Company or any subsidiary are eligible to purchase shares of common stock and to receive awards of shares, restricted shares, performance shares, RSUs or stock appreciation rights or grants of nonstatutory stock options. Only employees are eligible to receive grants of incentive stock options. As of December 31, 2018, 1,374 employees (including officers) andnon-employee directors would have been eligible to purchase common stock and to receive awards under the 2010 Plan.

Administration

The 2010 Plan is administered by the Compensation Committee. Subject to the limitations set forth in the plan, the Compensation Committee has the authority to determine, among other things, to whom awards will be granted, the number of shares subject to awards, the term during which an option or stock appreciation right may be exercised and the rate at which the awards may vest or be earned, including any performance criteria to which they may be subject. The Compensation Committee also has the authority to determine the consideration and methodology of payment for awards. The Board has created a secondary committee, theNon-Management Stock Option Committee, which is

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authorized to make awards and grants under the 2010 Plan to eligible individuals other than members of the Board, the “Section 16 officers,” and employees who hold the title of Senior Vice President or above.

Maximum Shares and Award Limits

A total of 36,753,475 shares of common stock are currently reserved for issuance under the 2010 Plan. As of March 12, 2019, the Company had outstanding options to purchase an aggregate of 13,435,299 shares of common stock (with exercise prices ranging from $12.46 to $138.52 per share) under the 2010 Plan, outstanding RSUs covering 1,494,294 shares, and outstanding performance shares pursuant to which a maximum of 480,495 shares could be issued and had 4,932,837 shares of common stock available for issuance under the 2010 Plan (or 12,632,837 shares of common stock including the 7,700,000 shares subject to stockholder approval at the Annual Meeting). As of March 12, 2019, the Company had outstanding options to purchase an aggregate of 13,435,299 shares of common stock under the 2010 Plan at a weighted average exercise price of $76.72 per share and with a weighted average remaining contractual term of 1.73 years. The 2010 Plan replaced the 1991 Stock Plan and the 1993 Directors’ Stock Option Plan. Shares that are subject to awards that expire, terminate or are cancelled under either the 1991 Stock Plan or the 1993 Directors’ Stock Option Plan will not be made available for future awards under the 2010 Plan. Other than outstanding options to purchase common stock under the 1993 Directors’ Stock Option Plan and the 2010 Plan, outstanding RSUs and performance shares under the 2010 Plan, and 66,666 outstanding RSUs granted outside of the 2010 Plan to Hervé Hoppenot, the Company had no other outstanding awards as of March 12, 2019, and no shares remain available for future issuance under either the 1991 Stock Plan or the 1993 Directors’ Stock Option Plan. No one award recipient may receive awards under the 2010 Plan in any calendar year that relate to more than 800,000 shares of common stock. If the proposed amendments are approved by stockholders at the Annual Meeting, each “full value” award such as an award of RSUs, restricted shares or performance shares (that is, any sales or awards of shares other than upon exercise of options or other than pursuant to sales at purchase prices at least equal to the fair market value of the shares) will reduce the total share pool available under the 2010 Plan by 2.0 shares, and each stock option and any othernon-full value award will reduce the total share pool by 1.0 share for each underlying award share granted. In addition, other than automatic grants to outside directors, awards for no more than 5% of the total number of shares of common stock reserved for issuance under the 2010 Plan may vest sooner than 12 months from the date of grant.

These limitations shall be adjusted as appropriate and equitable in the event of a stock dividend, stock split, reclassification of stock or similar events. If an award made under the 2010 Plan expires without having been exercised in full, or if any restricted shares, RSUs or performance shares are forfeited or repurchased by Company due to failure to vest, then the corresponding shares will again become available for awards under the 2010 Plan. Upon the settlement of stock appreciation rights, all of the shares subject to any such stock appreciation right will reduce the number of shares available under the 2010 Plan, regardless of the number of shares actually issued. If any award is paid in cash rather than shares of common stock, the payment of cash will not reduce the number of available shares. The Company may grant awards under other plans or programs, which may be settled in shares of common stock issued under the 2010 Plan. Such shares shall be treated like shares issued in settlement of RSUs and, when issued, will reduce the number of shares of common stock available for issuance under the 2010 Plan.

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Stock Options

The terms of any grants of stock options under the 2010 Plan will be set forth in a stock option agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms and conditions of such option grants, which need not be identical. Stock options may provide for the accelerated exercisability in the event of the award recipient’s death, disability, or retirement or other events and may provide for expiration prior to the end of its term in the event of the termination of the award recipient’s service. The Compensation Committee may modify, extend or assume outstanding options or may accept the cancellation of outstanding options in return for the grant of new options for the same or a different number of shares and at the same or a different exercise price, or in return for the grant of the same or a different number of shares. However, outstanding options may not be modified to lower the exercise price, nor may outstanding options be assumed or accepted for cancellation in return for the grant of new options with a lower exercise price, unless approved by the Company’s stockholders. In no event will the Company purchase or assume in exchange for cash any stock option whose exercise price exceeds the fair market value of the underlying shares of common stock.

The exercise price of each option will be set by the Compensation Committee, subject to the following limits. The exercise price of an incentive stock option cannot be less than 100% of the fair market value of a share of common stock on the date the option is granted, and in the event an option recipient is deemed to be a 10% owner of our Company or one of our subsidiaries, the exercise price of an incentive stock option cannot be less than 110% of the fair market value of a share of common stock on the date the option is granted. The exercise price of a nonstatutory stock option cannot be less than 100% of the fair market value of a share of common stock on the date the option is granted. On March 12, 2019, the closing price for our common stock on The Nasdaq Global Select Market was $84.90. The maximum period in which an option may be exercised will be fixed by the Compensation Committee and included in each stock option agreement but cannot exceed ten years in the case of an incentive stock option, and in the event an option recipient is deemed to be a 10% owner of our Company or one of our subsidiaries, the maximum period for an incentive stock option granted to that person cannot exceed five years. In addition, no option recipient may be granted incentive stock options that are exercisable for the first time in any calendar year for common stock having a total fair market value (determined as of the option grant) in excess of $100,000.

The exercise price for the exercise of a stock option may be paid in cash or, to the extent that the stock option agreement so provides, by surrendering shares of common stock, by delivery of an irrevocable direction to a securities broker to sell shares and to deliver all or part of the sale proceeds to the Company in payment of the aggregate exercise price, by delivery of an irrevocable direction to a securities broker or lender to pledge shares, as security for a loan, and to deliver all or part of the loan proceeds to the Company in payment of the aggregate exercise price, by delivering afull-recourse promissory note, or in any other form that is consistent with applicable laws, regulations and rules. Options generally will be nontransferable except in the event of the option recipient’s death.

Stock options granted under the 2010 Plan must be exercised by the optionee before the expiration of such option. Each stock option agreement will set forth the extent to which the option recipient will have the right to exercise the option following the termination of the recipient’s service with us, and the right to exercise the option of any executors or administrators of the award recipient’s estate or any person who has acquired such options directly from the award recipient by bequest or inheritance.

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Automatic Option Grants to Directors

As discussed above under “Description of Amendments,” if the proposed amendments are approved by our stockholders at the Annual Meeting, the initial grants of 25,000 options to new nonemployee “outside” directors would be eliminated, and the annual grants made to outside directors following the conclusion of the Annual Meeting and each future annual meeting of our stockholders would be changed from a grant of 15,000 options to a grant consisting of 75% nonstatutory options and 25% RSUs having an aggregate grant date fair value of $500,000. The number of shares subject to the nonstatutory options will be determined by dividing 75% of $500,000 (or $375,000) by the Black-Scholes value of one such option, based on the average closing sale price for our shares on The Nasdaq Global Select Market over the 30 consecutive trading days concluding with the last trading day prior to the grant date, rounded down to the nearest whole share. The number of shares subject to the RSUs will be determined by dividing 25% of $500,000 (or $125,000) by such 30 trading day average price, rounded down to the nearest whole share. The exercise price of the options will be equal to the fair market value on the date of the grant, and the options will have a term of ten years. Each outside director who is not initially elected at a regular annual meeting of our stockholders will receive awards within 10 business days of his or her election having an aggregate grant date fair value of a pro rata portion of $500,000, determined based on the number of full calendar months remaining from the date of election until the next regular annual meeting divided by 12. Such outside director’s awards will consist of 75% nonstatutory options and 25% RSUs determined in a manner similar to that used for the annual awards to outside directors following the conclusion of the regular annual meeting, except that the values of the awards to such outside director will be determined as of the grant date of such awards. All annual awards to outside directors will vest (and in the case of options, become exercisable) on the earlier of the first anniversary of the date of grant or immediately prior to the next regular annual meeting of our stockholders.

Options granted to outside directors will become fully vested if a change in control occurs with respect to the Company during the director’s service. The Board may from time to time increase the number of shares subject to an annual grant if the Board determines that the increase is necessary to induce individuals to become or remainnon-employee directors, or to address an increase in the duties or responsibilities of anon-employee director. The Board may also determine that the exercise price of such an option shall be greater than the fair market value of the common stock on the date of grant and that the option shall be exercisable on a different schedule than stated above.

Restricted Shares

The terms of any awards of restricted shares under the 2010 Plan will be set forth in a restricted share agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms and conditions of the restricted share agreements, which need not be identical. Restricted share awards generally will be subject to vesting requirements of a minimum period of three years, and may be subject to transfer restrictions. Award recipients who are granted restricted shares generally have all of the rights of a stockholder with respect to those shares. Restricted shares may be issued for consideration as the Compensation Committee may determine, including cash, cash equivalents,full-recourse promissory notes, past services and future services.

Restricted Stock Units

The terms of any awards of RSUs under the 2010 Plan will be set forth in an RSU agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms and conditions of the RSU agreements, which need not be identical. RSUs give an award recipient

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the right to acquire a specified number of shares of common stock, or at the Compensation Committee’s discretion, cash, or a combination of common stock and cash, at a future date upon the satisfaction of certain vesting conditions based upon a vesting schedule or performance criteria established by the Compensation Committee. RSUs generally will be subject to vesting requirements of a minimum period of three years. RSUs may be granted in consideration of a reduction in the award recipient’s other compensation, but no cash consideration is required of the award recipient. Unlike restricted shares, the stock underlying RSUs will not be issued until the stock units have vested, and recipients of RSUs generally will have no voting or dividend rights prior to the time of issuance of any common stock upon settlement.

Stock Appreciation Rights

The terms of any awards of stock appreciation rights under the 2010 Plan will be set forth in an agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms, conditions and restrictions of any such agreements, which need not be identical. A stock appreciation right generally entitles the award recipient to receive a payment upon exercise equal to the amount by which the fair market value of a share of common stock on the date of exercise exceeds the value of a share of common stock on the date of grant. The exercise price of a stock appreciation right cannot be less than 100% of the fair market value of a share of common stock on the date the stock appreciation right is granted. The amount payable upon the exercise of a stock appreciation right may be settled in cash or by the issuance of shares of common stock.

Performance Shares

The terms of any awards of performance shares under the 2010 Plan will be set forth in an agreement to be entered into between the Company and the recipient. The Compensation Committee will determine the terms, conditions and restrictions of any such agreements, which need not be identical.

Performance shares give an award recipient the right to acquire a specified number of shares of common stock, or at the Compensation Committee’s discretion, cash, or a combination of common stock and cash, at a future date, based on performance criteria set forth in the performance share agreement. The actual number of performance shares eligible for settlement may be larger or smaller than the number included in the original award, based on the performance criteria. Performance shares may be granted in consideration of a reduction in the award recipient’s other compensation, but no cash consideration is required of the award recipient. An award of performance shares generally will vest only if the award recipient performs services for the entire performance period (or if less, one year). Recipients of performance shares generally will have no voting or dividend rights prior to the time of issuance of any common stock upon settlement.

Qualifying Performance Criteria

The 2010 Plan sets forth performance criteria that may be used in the case of performance shares and certain other awards intended to qualify for the“performance-based compensation” exemption from the corporate deduction limit under Section 162(m) of the Code. The“performance-based compensation” exemption has been repealed effective for tax years beginning after December 31, 2017, subject to certain transition rules for previously granted awards, as described below under “Certain Federal Income Tax Aspects of Awards Under the Plan—Code Section 162(m).” The Compensation Committee may, but is not required to, apply the performance criteria set forth in the 2010 Plan to performance shares and other awards granted in 2019 and future years.

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To qualify as a“performance-based compensation,” the number of shares or other benefits granted, issued, retainable or vested under an award may be made subject to the attainment of performance goals for a specified period of time relating to one or more of the following performance criteria, either individually, alternatively or in any combination, applied to either us as a whole or to a business unit or subsidiary, either individually, alternatively or in any combination, and measured either annually or cumulatively over a period of years, on an absolute basis or relative to apre-established target, to previous years’ or quarter’s results or to the performance of one or more comparable companies or a designated comparison group or index, in each case as specified by the Compensation Committee in the award: (a) cash flow (including operating cash flow), (b) earnings per share, (c) earnings before any combination of interest, taxes, depreciation, or amortization, (d) return on equity, (e) total stockholder return, (f) share price performance, (g) return on capital, (h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating income or net operating income, (l) operating profit or net operating profit, (m) operating margin or profit margin (including as a percentage of revenue), (n) return on operating revenue, (o) return on invested capital, (p) market segment shares, (q) economic profit, (r) achievement of target levels of discovery and/or development of products, including but not limited to regulatory achievements, (s) achievement of research and development objectives, and (t) formation of joint ventures, strategic relationships or other commercial, research or development collaborations. The Compensation Committee may appropriately adjust any evaluation of performance under a qualifying performance criteria to exclude any of the following events that occur during a performance period: (i) assetwrite-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) any extraordinary, nonrecurring items disclosed in the Company’s financial statements or in management’s discussion and analysis of financial condition and results of operations appearing in our annual report to stockholders for the applicable year. If applicable, the Compensation Committee will determine the qualifying performance criteria and any permitted exclusions for events described in the preceding sentence not later than the 90th day of the performance period, and will determine and certify the extent to which the qualifying performance criteria have been met. For awards intended to qualify as“performance-based compensation” under Section 162(m) of the Code, the Compensation Committee may not in any event increase the amount of compensation payable under the 2010 Plan upon the attainment of qualifying performance criteria to an award recipient who is a “covered employee” within the meaning of Section 162(m) of the Code.

Amendment and Termination

No awards may be granted under the 2010 Plan, as amended, after March 18, 2021 or, if the proposed amendments are approved by stockholders, after June 30, 2021. The Board may amend or terminate the 2010 Plan at any time, but an amendment will not become effective without the approval of the Company’s stockholders to the extent required by applicable laws, regulations or rules. No amendment or termination of the 2010 Plan will affect an award recipient’s rights under outstanding awards without the award recipient’s consent.

Effect of Certain Corporate Events

In the event of a subdivision of the outstanding common stock or a combination or consolidation of the outstanding common stock (by reclassification or otherwise) into a lesser number of shares, aspin-off or a similar occurrence, or declaration of a dividend payable in common stock or, if in an amount that has a material effect on the price of the shares, in cash, the Compensation Committee will make appropriate adjustments in the number of shares covered by outstanding awards and the exercise price of outstanding options and stock appreciation rights, and the number of shares available under the 2010 Plan.

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In the event of a merger or other reorganization, subject to any acceleration provisions in the agreement relating to an award, outstanding awards will be treated in the manner provided in the agreement of merger or reorganization. That agreement may provide for the assumption of outstanding awards by the surviving corporation or its parent, for their continuation by the Company (if the Company is the surviving corporation), for the substitution by the surviving corporation or its parent of its own awards, or for the acceleration of the exercisability of awards followed by the cancellation of those awards. The agreement of merger or reorganization may also provide for the cancellation of outstanding awards, with a payment of the value of those awards (without regard as to whether those awards have vested or are exercisable) as of the closing date of the merger or reorganization. In such an event, the payment may be in cash or securities, be paid in installments, be deferred until the underlying award would have vested, become exercisable or settled under the agreement relating to the award, and may be subject to vesting and performance criteria no less favorable to the recipient than under the agreement relating to the award, in all cases without the recipients’ consent.

Certain Federal Income Tax Aspects of Awards Under the Plan

This is a brief summary of the federal income tax aspects of awards that may be made under the 2010 Plan based on existing U.S. federal income tax laws. This summary provides only the basic tax rules. It does not describe a number of special tax rules, including the alternative minimum tax and various elections that may be applicable under certain circumstances. It also does not reflect provisions of the income tax laws of any municipality, state or foreign country in which a holder may reside, nor does it reflect the tax consequences of a holder’s death. The tax consequences of awards under 2010 Plan depend upon the type of award and, if the award is to an executive officer, whether compensation paid to the officer is subject to the tax deduction limit imposed by Section 162(m) of the Code.

Incentive Stock Options

The recipient of an incentive stock option generally will not be taxed upon grant of the option. Federal income taxes are generally imposed only when the shares of common stock from exercised incentive stock options are disposed of, by sale or otherwise. The amount by which the fair market value of the common stock on the date of exercise exceeds the exercise price is, however, included in determining the option recipient’s liability for the alternative minimum tax. If the incentive stock option recipient does not sell or dispose of the shares of common stock until more than one year after the receipt of the shares and two years after the option was granted, then, upon sale or disposition of the shares, the difference between the exercise price and the market value of the shares of common stock as of the date of exercise will be treated as a capital gain, and not ordinary income. If a recipient fails to hold the shares for the minimum required time the recipient will recognize ordinary income in the year of disposition generally in an amount equal to any excess of the market value of the common stock on the date of exercise (or, if less, the amount realized or disposition of the shares) over the exercise price paid for the shares. Any further gain (or loss) realized by the recipient generally will be taxed asshort-term orlong-term gain (or loss) depending on the holding period. We will generally be entitled to a tax deduction at the same time and in the same amount as ordinary income is recognized by the option recipient.

Nonstatutory Stock Options

The recipient of stock options not qualifying as incentive stock options generally will not be taxed upon the grant of the option. Federal income taxes are generally due from a recipient of nonstatutory stock options when the stock options are exercised. The excess of the fair market value of the common

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stock purchased on such date over the exercise price of the option is taxed as ordinary income. Thereafter, the tax basis for the acquired shares is equal to the amount paid for the shares plus the amount of ordinary income recognized by the recipient. We will generally be entitled to a tax deduction at the same time and in the same amount as ordinary income is recognized by the option recipient by reason of the exercise of the option.

Other Awards

Recipients who receive RSU awards will generally recognize ordinary income when they receive shares upon settlement of the awards, in an amount equal to the fair market value of the shares at that time. Recipients who receive awards of restricted shares subject to a vesting requirement will generally recognize ordinary income at the time vesting occurs, in an amount equal to the fair market value of the shares at that time minus the amount, if any, paid for the shares. However, a recipient who receives restricted shares which are not vested may, within 30 days of the date the shares are transferred, elect in accordance with Section 83(b) of the Code to recognize ordinary compensation income at the time of transfer of the shares rather than upon the vesting dates. Recipients who receive stock appreciation rights will generally recognize ordinary income upon exercise in an amount equal to the excess of the fair market value of the underlying shares of common stock on the exercise date and cash received, if any, over the exercise price. Recipients who receive performance shares will generally recognize ordinary income at the time of settlement, in an amount equal to the cash received, if any, and the fair market value of any shares received. We will generally be entitled to a tax deduction at the same time and in the same amount as ordinary income is recognized by the recipient.

Code Section 162(m)

Section 162(m) of the Code generally disallows a tax deduction to us for annual compensation in excess of $1,000,000 paid to certain executive officers. Prior to 2018, however, we could deduct compensation above $1,000,000 if it was“performance-based compensation” within the meaning of Section 162(m). Stock options and performance shares granted prior to 2018 were intended to qualify asperformance-based compensation. The approval of our amended and restated 2010 Plan by our stockholders in 2013 satisfied one of the requirements for theperformance-based compensation exemption.

The Section 162(m) exemption forperformance-based compensation has been repealed, effective for tax years beginning after December 31, 2017, subject to a transition rule for amounts payable pursuant to written binding contracts in effect on November 2, 2017. We believe that outstanding stock options granted prior to November 2, 2017 qualify for this transition rule, and thus retain their status as deductibleperformance-based compensation.

New Plan Benefits

The Compensation Committee has not made any determination with respect to future awards under the 2010 Plan and, except for automatic grants tonon-employee “outside” directors, awards and the terms of any awards under the plan for the current year or any future year are not determinable. As described above, the 2010 Plan provides for the automatic grant of awards to outside directors. If stockholders approve the proposed amendments to the 2010 Plan, each outside director nominee who will continue to serve as a member of the Board will receive a grant consisting of 75% nonstatutory options and 25% RSUs having an aggregate grant date fair value of $500,000.

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Required Vote

Approval of the amendments to the 2010 Plan requires the affirmative vote of a majority of the shares present and entitled to vote.

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The Board recommends a vote “FOR” the Amendment to the Company’s Amended and Restated 2010 Stock Incentive Plan

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Proposal 4

Ratification of Independent Registered Public


Accounting Firm

​
The Audit and Finance Committee has appointed the firm of Ernst & Young LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2019,2022, subject to reconsideration by the Audit and Finance Committee should our stockholders fail to ratify such appointment at the Annual Meeting or should the Audit and Finance Committee not approve Ernst & Young LLP’s audit plan for the fiscal year ending December 31, 2019.2022. Ernst & Young LLP has audited our financial statements since the Company’s inception in 1991. Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting. They will have an opportunity to make a statement, if they desire to do so, and will be available to respond to appropriate questions.

Principal Accountant Fees and Services

The following table sets forth the aggregate fees billed or expected to be billed by Ernst & Young LLP for audit and other services rendered.

  Year Ended December 31, 
  2018     2017 
  (in thousands) 

Audit Fees(1)

 $2,174     $2,017 

Audit-related Fees(2)

  —      75 
 

 

 

     

 

 

 
 $2,174     $2,092 

(1)

​​​Year Ended December 31​
​​​2021​​2020​
​​​(in thousands)​
Audit Fees(1)​​​$2,447​​​​$2,297​​
Audit-related Fees(2)​​​$218​​​​​—​​

​
(1)
Audit fees include fees and out-of-pocket expenses billed for the audit of the Company’s annual statements and reviews of the Company’s quarterly financial statements, including the Company’s Annual Report on Form 10-K, the audit of the Company’s internal control over financial reporting, and include fees for SEC registration statements and consultation on accounting standards or transactions.
​
(2)
Audit-related fees include fees billed for consultations concerning ERP system implementation and related controls environment.
​
10-K, the audit of the Company’s internal control over financial reporting, and include fees for SEC registration statements and consultation on accounting standards or transactions.

(2)

Audit-related fees include fees billed for consultations concerning the PeopleSoft upgrade, auditing of intellectual property transfer, information technology testing procedures and the PeopleSoft controls environment, and consultations concerning financial and accounting matters not classified as audit services.

The Audit and Finance Committee considered whether the provision of the services other than the audit services is compatible with maintaining Ernst & Young LLP’s independence.

Pre-Approval Policies and Procedures

The Audit and Finance Committee has established a policy topre-approve all audit and permissiblenon-audit services provided by the Company’s independent registered public accounting firm. All of the services provided by the Company’s independent registered public accounting firm in 20182021 and 20172020 werepre-approved.

Required Vote

Ratification will require the affirmative vote of a majority of the shares present and entitled to vote. Stockholder ratification of the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm is not required by the Company’s Bylaws or otherwise. However, the

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    Proposal 4 Ratification of Independent Registered Public Accounting Firm    

Board is submitting the selection of Ernst & Young LLP to the stockholders for ratification as a matter of corporate practice. If the stockholders fail to ratify the selection, the Audit and Finance Committee will reconsider whether or not to retain that firm. Even if the selection is ratified, the Audit and Finance Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if the Audit and Finance Committee determines that such a change would be in the best interests of the Company and its stockholders.

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The Board recommends a vote “FOR” Ratification of Ernst & Young LLP as the Company’s independent registered public accounting.

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Proxy Statement 2019 2022| 7779
​

Proposal 5

Stockholder Proposal

Proposal 5 set forth below was submitted to the Company by Dundas I. Flaherty and Sandra J. Kulli, of 3749 Malibu Vista Drive, Malibu, California 90265. Mr. Flaherty and Ms. Kulli state that, as of November 13, 2018, they own in the aggregate 110,120 shares of our common stock and that they intend to hold those shares until after the date of the 2019 Annual Meeting. Mr. Flaherty’s and Ms. Kulli’s proposal is printed below verbatim. The Company is not responsible for the contents of this proposal or the supporting statement of Mr. Flaherty and Ms. Kulli. Mr. Flaherty and Ms. Kulli have advised the Company that they intend to present the proposal at our Annual Meeting.Our Board recommends a voteAGAINSTthe proposal for the reasons set forth following the proposal.

STOCKHOLDER PROPOSAL FOR AN INDEPENDENT BOARD CHAIR

RESOLVED: Stockholders of Incyte Corporation urge the Board of Directors to take the steps necessary to adopt a policy, with amendments to governing documents as needed, so that, to the extent feasible, the Chairman of the Board shall be an independent director who has not previously served as an executive officer of the Company. The policy should be implemented so as not to violate any contractual obligations and should specify the process for selecting a new independent chairman if the Chairman ceases to be independent between annual meetings of shareholders or if no independent director is available and willing to serve as Chairman.

SUPPORTING STATEMENT

Our CEO currently serves as Chairman of the Board of Directors. In our view, the Chairman should be an independent director, who has not previously served as an executive, in order to provide robust oversight and accountability of management, and to facilitate effective deliberation of corporate strategy, which we believe, is difficult to accomplish when the CEO also serves as chairman. Even with robust responsibilities, we believe the position of a lead independent director is inadequate to this task because ultimate responsibility for board leadership remains with the chairman/CEO.

We believe that these considerations are particularly compelling at this time. Approximately five years ago, the company essentially operated as a biotechnology startup with oneFDA-approved product, ruxolitinib, with other product possibilities based primarily on related small-molecule medicinal chemistry science.

Since then, Incyte has successfully pursued the commercial potential of ruxolitinib, with excellent sales growth, run clinical trials demonstrating benefit in treating several diseases besides myelofibrosis, and received FDA approval for additional indications.

However, Incyte has enjoyed less success with other products. The Company had high hopes for epacadostat, a novel molecule thought to synergize with anti-cancer breakthroughs such as Keytruda and Opdivo, and baricitinib, for rheumatoid arthritis partnered with Eli Lilly and Company.

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  Proposal 5 Stockholder Proposal  

Neither product succeeded as previewed. Incyte stopped late-stage clinical trials of epacadostat in April 2018, citing lack of efficacy, and has not announced plans to continue developing it. Baricitinib, once believed by securities analysts to have high potential, is now not expected to achieve such potential, after delays and difficulties with FDA approval and safety concerns.

Despite success with ruxolitinib, Incyte’s stock today is about half its value when hopes for epacadostat were high. Indeed, as of late 2018, the stock price was approximately the same as it was five years ago.

In our view, Incyte’s general lack of success with new products since 2014 argues in favor of adding board leadership to challenge management on its plans and strategy, particularly. Separating the roles of Chairman and CEO can help better align the Board’s interests with shareholders’ interests and improve Board-management dialogues on successful new products to help make Incyte an outstanding performer.

We urge you to vote FOR this proposal.

BOARDTABLE OF DIRECTORS’ STATEMENT IN OPPOSITION TO PROPOSAL 5

Our Board of Directors unanimously recommends a vote “CONTENTS​

AGAINST” Proposal 5. The Board has considered Proposal 5, and, for the reasons described below, believes that the proposal is not in the best interests of the Company or its stockholders.

Summary. Our Board is committed to high standards of corporate governance. Our current leadership structure and governing documents permit the roles of Chairman and CEO to be filled by the same or different individuals. Where the Chairman and CEO roles are filled by the same individual, our Corporate Governance Guidelines require the independent directors on our Board to appoint a Lead Independent Director.

The Board values its flexibility to select, from time to time, a leadership structure that it believes is most able to serve our Company’s and stockholders’ best interests based on the qualifications of individuals available and circumstances existing at the time. As such, the Board periodically evaluates whether combining or separating the roles of Chairman and CEO is in the best interests of our Company and our stockholders.

Currently, the Board believes that it is in the best interests of our stockholders to have Hervé Hoppenot, our President and CEO, serve as Chairman, coupled with Julian C. Baker — a managing member of the general partner of our largest stockholder (Baker Bros. Advisors LP and affiliated entities (the “Baker Funds”)) — serving as our Lead Independent Director. Previously, however, the Board had separated the Chairman and CEO roles, including during the beginning of Mr. Hoppenot’s tenure as CEO. The Board retains the authority to modify this structure as it deems appropriate.

The Board believes that a policy limiting its flexibility to choose, consistent with its fiduciary duties, a leadership structure that in the Board’s view enables our Company to most effectively execute its strategy and business plans to maximize stockholder value is not only unnecessary but would also be detrimental to our Company and our stockholders.

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    Proposal 5 Stockholder Proposal    

Board Commitment to Independence. The Board maintains a strong commitment to ensuring Board independence so that it is able to maintain effective oversight of management. The Board’s commitment to independence includes:

✓

Annual appointment of a strong Lead Independent Director, who also currently represents our largest stockholder, the Baker Funds, thereby ensuring strong representation of stockholder interests

✓

Robust duties of the Lead Independent Director, which include:

presiding at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent directors

serving as liaison between the Chairman/CEO and the other independent directors

-

Mr. Baker is actively involved with our Company and devotes a significant amount of his time and energy to fulfilling his responsibilities as Lead Independent Director. Mr. Baker meets regularly, and works closely with, our Chairman and CEO and other senior members of management; also, he facilitates communication among the independent directors on our Board and speaks regularly with each independent director, promoting the candid exchange of ideas among Board members

approving information sent to the Board

approving meeting agendas for the Board

-

Mr. Baker provides guidance with respect to, in addition to approving, the agendas

approving meeting schedules to assure that there is sufficient time for discussion of all agenda items

authority to call meetings of the independent directors

being available for consultation with stockholders, when appropriate

-

during 2018, Mr. Baker held discussions with several of our leading stockholders, who collectively represented approximately 28% of our common stock (which is in addition to the approximately 16% owned by the Baker Funds, meaning approximately 44% of our common stock was represented throughout these discussions; moreover, Mr. Baker’s engagement with our stockholders has continued during this 2019 proxy season

✓

Review, at least annually, of the Company’s strategic plan and the following year’s capital and operating budgets

✓

Annual election of all directors, ensuring accountability to stockholders

✓

Regular executive sessions of the independent,non-management directors — without Mr. Hoppenot — to review Company performance, CEO performance, management effectiveness, proposed programs and transactions and the Board meeting agenda items

✓

Requirement that only independent directors serve on the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee

✓

Requirement that a majority of the Board be comprised of independent directors

-

currently, all members of the Board other than Mr. Hoppenot are independent directors

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  Proposal 5 Stockholder Proposal  

✓

Corporate Governance Guidelines providing that the Board may have access to Company management and employees and its own advisors, at the Board’s discretion.

Benefits of Current Combined Leadership Structure. The Board believes that the Company and our stockholders have been best served by having Mr. Hoppenot in the role of Chairman and CEO and Mr. Baker as Lead Independent Director for the following reasons:

✓

Unique Knowledge of our Business.Mr. Hoppenot is most familiar with our business, our management and employees, and the uniquenear-and longer-term challenges we face. Because of his knowledge and extensive experience regarding our operations, thehighly-regulated biopharmaceutical industry and the markets around the world in which we compete, Mr. Hoppenot is the director best suited to identify strategic opportunities and focus the activities of the Board. Mr. Hoppenot’sday-to-day insight into our challenges and opportunities facilitates a timely deliberation by the Board of important matters.

✓

Accountability to All Stakeholders. As Chairman and CEO, Mr. Hoppenot uniquely has accountability to the Board, to stockholders and to the employees that help every day to make our Company a successful company. Whether our Company faces successes or failure, Mr. Hoppenot is the person who must face the Board to account for our Company’s actions, who must face the employees who put their trust in him and our Company and, most importantly, the stockholders who own our Company.In fact, in 2018, Mr. Hoppenot presented directly to stockholders, analysts and the public over 20 times through presentations at regular and frequent investor conferences, through quarterly earnings conference calls with extensivequestion-and-answer sessions, and through individual and small-group stockholder meetings. Mr. Hoppenot serves as an important bridge between the Board and management and provides critical leadership for carrying out our strategic initiatives and confronting our challenges. Through his extensive and frequent engagement with stockholders, Mr. Hoppenot is in the best position to have a deep understanding of the concerns of the owners of our Company and is in the best position to ensure those concerns are communicated to, and deliberated on by, our Board on a regular basis. The Board believes that Mr. Hoppenot brings a unique,stockholder-focused insight to assist our Company to most effectively execute its strategy and business plans to maximize stockholder value.

✓

Effective Action on Stockholder Feedback. The substantial and sustained engagement with our stockholders by Mr. Hoppenot — as our Chairman and CEO — and Mr. Baker — as our Lead Independent Director — and their collective and detailed knowledge of stockholder concerns have ensured that stockholder interests in significant governance and compensation enhancements are brought before the Board in a meaningful and timely way. The significant governance and compensation changes enacted following and in response to stockholder feedback in recent years are detailed above in this proxy statement under “Stockholder Engagement”, starting on page 6, and include:

○

Aligning the compensation of our Board of Directors to that of our peers

○

Enhancingpay-for-performance by using performance-based shares in executive compensation

○

Requiring majority voting for directors in uncontested elections

○

Adopting a3-year cash clawback policy for executives

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    Proposal 5 Stockholder Proposal    

○

Requiring that all directors and executive officers hold a minimum amount of Incyte equity

○

Imposing a12-month minimum vesting period for employee equity awards generally

○

Eliminating taxgross-ups on perquisites

○

Prohibiting hedging transactions in Incyte stock by directors and officers

○

Increasing transparency in our discussion of compensation practices and our corporate goals

✓

Our Board is Stronger and More Effective. The current leadership structure provides the Board with more complete and timely information about our Company, a unified structure and consistent leadership direction internally and externally, and provides a collaborative environment for Boarddecision-making. The strength and effectiveness of the communications between Mr. Hoppenot as our Chairman and Mr. Baker as our Lead Independent Director result in effective Board oversight of the issues, plans and prospects of our Company.

Strategic Flexibility Helps Maintain Competitive Position with Our Peers. Our Board currently believes it is in the best interest of the stockholders that Mr. Hoppenot act as Chairman and CEO. As stated above, the Board has separated the Chairman and CEO roles in the past. The Board considers its leadership structure every year. In the future, circumstances may lead the Board to believe that separating the roles is in the best interests of our stockholders at that time. The proposed requirement of Proposal 5 that the Chairman and CEO rolesmust be separated would restrict your Board from doing what it thinks is in your best interests at any given time. Of the 16 companies in our current executive compensation peer group, 75% provide their boards with the strategic flexibility to structure their leadership as they believe to be in the best interests of their respective stockholders. The strategic inflexibility proposed by Proposal 5 would force us into a competitive disadvantage against the nimble peer companies with whom we compete.

Conclusion and Recommendation AGAINST Proposal 5. The strong leadership role of the Board’s independent directors in the oversight of our Company is evident from the independent composition of the Board aside from our CEO, the exclusively independent composition of the Board’s Audit, Compensation and Nominating and Corporate Governance Committees, and the functioning of the Board’s independent directors and Lead Independent Director, who is also a principal in the general partner of the Baker Funds, our largest stockholder. It is important that the Board continues to be able to assess all relevant facts and circumstances, in fulfilment of its fiduciary duty, to determine the leadership structure that is best suited to meet the needs of our Company at any given time. Accordingly, the Board believes that adoption of a fixed policy requiring an independent Chairman is not in the best interests of stockholders.

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The Board recommends a vote “AGAINST” Proposal 5

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Security Ownership of Certain Beneficial Owners and Management

​
The following table sets forth certain information as of March 12, 2019,April 18, 2022, as to shares of our common stock beneficially owned by: (i) each person who is known to us to own beneficially more than 5% of our common stock, (ii) each of our directors, (iii) each of our executive officers named under “Executive Compensation—Summary Compensation Table” and (iv) all of our directors and executive officers as a group. Ownership information is based upon information furnished by the respective individuals or entities, as the case may be. Unless otherwise indicated below, the address of each beneficial owner listed on the table is c/o Incyte Corporation, 1801 AugustineCut-Off, Wilmington, DE 19803. The percentage of our common stock beneficially owned is based on 214,264,527221,496,070 shares outstanding as of March 12, 2019.April 18, 2022. In addition, shares issuable pursuant to options or convertible securities that may be acquired, or RSUs that vest, in each case, within 60 days of March 12, 2019April 18, 2022 are deemed to be issued and outstanding and have been treated as outstanding in calculating and determining the beneficial ownership and percentage ownership of those persons possessing those securities, but not for any other individuals.

  Name and Address of Beneficial Owner(1)  Shares
Beneficially
Owned(#)(1)		   

Percentages

Beneficially

Owned(%)(1)

 

5% Stockholders

    

Felix J. Baker (2)

   34,536,176    16.1 

Baker Bros. Advisors LP and affiliated entities (2)

   34,426,607    16.1 

The Vanguard Group and affiliates (3)

   18,818,239    8.8 

Wellington Management Group LLP (4)

   15,619,858    7.3 

BlackRock, Inc. (5)

   15,262,962    7.1 

Named Executive Officers and Directors

    

Hervé Hoppenot (6)

   587,216    * 

David W. Gryska (7)

   44,991    * 

Reid Huber (8)

   118,305    * 

Steven H. Stein (9)

   60,298    * 

Wenqing Yao (10)

   205,781    * 

Maria E. Pasquale (11)

   14,333    * 

Julian C. Baker (2)

   34,533,759    16.1 

Jean-Jacques Bienaimé (12)

   96,896    * 

Paul A. Brooke (13)

   393,929    * 

Paul J. Clancy (14)

   90,000    * 

Wendy L. Dixon (15)

   198,533    * 

Jacqualyn A. Fouse (16)

   33,316    * 

Paul A. Friedman (17)

   451,511    * 

All directors and executive officers as a group(16 persons)(18)

   36,955,642    17.1 

Name and Address of Beneficial Owner(1)​​
Shares
Beneficially
Owned
(#)(1)
​​
Percentages
Beneficially
Owned
(%)(1)
​
5% Stockholders​​​​​​​​​​​​​
Felix J. Baker(2)​​​​36,644,727​​​​​16.5​​
Baker Bros. Advisors LP and affiliated entities(2)​​​​36,279,680​​​​​16.4​​
The Vanguard Group and affiliates(3)​​​​20,944,759​​​​​9.5​​
BlackRock, Inc.(4)​​​​18,336,658​​​​​8.3​​
Dodge & Cox (5)​​​​16,657,586​​​​​7.5​​
Named Executive Officers and Directors​​​​​​​​​​​​​
Hervé Hoppenot(6)​​​​1,109,774​​​​​*​​
Christiana Stamoulis(7)​​​​101,636​​​​​*​​
Steven H. Stein(8)​​​​185,441​​​​​*​​
Barry P. Flannelly(9)​​​​132,653​​​​​*​​
Maria E. Pasquale(10)​​​​85,520​​​​​*​​
Julian C. Baker(2)​​​​36,642,310​​​​​16.5​​
Jean-Jacques Bienaimé(11)​​​​131,840​​​​​*​​
Otis W. Brawley (12)​​​​7,165​​​​​*​​
Paul J. Clancy(13)​​​​129,286​​​​​*​​
Wendy L. Dixon(14)​​​​143,764​​​​​*​​
Jacqualyn A. Fouse(15)​​​​88,257​​​​​*​​
Edmund P. Harrigan(16)​​​​28,456​​​​​*​​
Katherine A. High(17)​​​​15,143​​​​​*​​
All directors and executive officers as a group (18 persons)(18)
​​​​39,245,152​​​​​17.5​​
​
*
Represents less than 1% of our common stock.
​
(1)
To our knowledge, the persons named in the table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them, subject to community property laws where applicable and the information contained in the notes to this table.
​
(2)
Baker Bros. Advisors LP is the investment adviser to 667, L.P. and Baker Brothers Life Sciences, L.P. (“Baker Funds”). Baker Bros. Advisors (GP), LLC is the sole general partner of Baker Bros. Advisors LP. Julian C. Baker and Felix J. Baker are the managing members of Baker Bros. Advisors (GP), LLC. The address for Baker Bros. Advisors LP, the Baker Funds, Julian C. Baker and Felix J. Baker is 860 Washington Street, 3rd Floor, New York, New York 10014. Pursuant to the management agreements, as amended, among Baker Bros. Advisors LP, the Baker Funds and their respective general partners, the Baker Funds’ respective general partners relinquished to Baker Bros. Advisors LP all discretion and authority with respect to the investment and voting power of the securities held by the Baker
​
 *​

Represents less than 1% of our common stock.

(1)

To our knowledge, the persons named in the table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them, subject to community property laws where applicable and the information contained in the notes to this table.

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TABLE OF CONTENTS
​
Security Ownership of Certain Beneficial Owners and Management​

Funds, and thus Baker Bros. Advisors LP has complete and unlimited discretion and authority with respect to the Baker Funds’ investments and voting power over investments. According to an amended Schedule 13D filed March 10, 2022 and Form 4 filed April 4, 2022, the total number of shares of our common stock beneficially owned includes shares directly held as follows:
(2)Holder

Baker Bros. Advisors LP is the investment adviser to 667, L.P., Baker Brothers Life Sciences, L.P. and 14159 L.P. (“Baker Funds”). Baker Bros. Advisors (GP), LLC is the sole general partner of Baker Bros. Advisors LP. Julian C. Baker and Felix J. Baker are the managing members of Baker Bros. Advisors (GP), LLC. The address for Baker Bros. Advisors LP, the Baker Funds, Julian C. Baker and Felix J. Baker is 860 Washington Street, 3rd Floor, New York, New York 10014. Pursuant to the management agreements, as amended, among Baker Bros. Advisors LP, the Baker Funds and their respective general partners, the Baker Funds’ respective general partners relinquished to Baker Bros. Advisors LP all discretion and authority with respect to the investment and voting power of the securities held by the Baker Funds, and thus Baker Bros. Advisors LP has complete and unlimited discretion and authority with respect to the Baker Funds’ investments and voting power over investments. According to an amended Schedule 13D filed February 27, 2019, the total number of shares of our common stock beneficially owned includes shares directly held as follows:

​​Shares

Holder

Shares​
667, L.P.​​4,290,108​​2,734,189​​
Baker Brothers Life Sciences, L.P.​​29,150,637​
14159, L.P.​33,212,097​692,706​
Julian C. Baker​​196,788​​484,248​​
Felix J. Baker​​61,049​​281,190​​
Entities affiliated with Julian C. Baker and Felix J. Baker​​48,520​​83,857​​

Pursuant to an agreement between Baker Bros. Advisors LP and Julian C. Baker, Baker Bros. Advisors LP has sole voting and dispositive power with respect to 138,156205,475 shares owned directly by Julian C. Baker that were received by Mr. Baker either upon exercise of options, upon vesting of RSUs or in lieu of cash fees in connection with serving as a member of our Board of Directors and with respect to 155,000127,919 shares subject to RSUs that will vest and options exercisable within 60 days of March 12, 2019April 18, 2022 that are held by Julian C. Baker and that are included in the number of shares shown as beneficially owned.

(3)

According to an amended Schedule 13G filed February 12, 2019, filed by The Vanguard Group (“Vanguard”), Vanguard, in its capacity as investment adviser, may be deemed to beneficially own all shares listed in the table, and has sole dispositive power with respect to 18,568,103 shares, shared dispositive power with respect to 250,136 shares, sole voting power with respect to 218,648 shares and shared voting power with respect to 36,199 shares. The number of shares reported as beneficially owned by Vanguard in the amended Schedule 13G includes 11,113,220 shares representing 5.2% of our outstanding common stock, that Vanguard Specialized Funds – Vanguard Health Care Fund separately reported as beneficially owned in a Schedule 13G filed January 31, 2019. The address of the principal place of business of Vanguard is 100 Vanguard Blvd., Malvern, Pennsylvania 19355.

(4)

According to an amended Schedule 13G filed February 12, 2019, filed by Wellington Management Group LLP (“Wellington”), Wellington, in its capacity as investment adviser, may be deemed to beneficially own all shares listed in the table, and has shared dispositive power with respect to all such shares and shared voting power with respect to 2,921,938 shares. The address of the principal place of business of Wellington is 280 Congress Street, Boston, Massachusetts 02110.

(5)

According to an amended Schedule 13G filed February 4, 2019, filed by BlackRock, Inc. (“BlackRock”), BlackRock, in its capacity as investment adviser, may be deemed to beneficially own all shares listed in the table and has sole voting power with respect to 13,877,927 shares. The address of the principal place of business of BlackRock is 55 East 52nd Street, New York, New York, 10022.

(6)

Includes 434,379 shares subject to options exercisable within 60 days of March 12, 2019. Does not include 87,728 shares underlying RSUs and 20,971 shares underlying performance shares that will remain unvested within 60 days of March 12, 2019.

(7)

Mr. Gryska resigned as Executive Vice President and Chief Financial Officer effective December 2019. Includes 44,158 shares subject to options exercisable within 60 days of March 12, 2019.

(8)

Dr. Huber resigned as Executive Vice President and Chief Scientific Officer effective November 2019. Includes 91,711 shares subject to options exercisable within 60 days of March 12, 2019.

(9)

Includes 51,941 shares subject to options exercisable within 60 days of March 12, 2019. Does not include 5,416 shares underlying RSUs and 5,389 shares underlying performance shares that will remain unvested within 60 days of March 12, 2019.

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(3)
According to an amended Schedule 13G filed February 10, 2022, filed by The Vanguard Group (“Vanguard”), Vanguard, in its capacity as investment adviser, may be deemed to beneficially own all shares listed in the table, and has sole dispositive power with respect to 20,166,978 shares, shared dispositive power with respect to 777,781 shares, and shared voting power with respect to 318,087 shares. The address of the principal place of business of Vanguard is 100 Vanguard Blvd., Malvern, Pennsylvania 19355.
​
(4)
According to an amended Schedule 13G filed February 1, 2022, filed by BlackRock, Inc. (“BlackRock”), BlackRock, in its capacity as investment adviser, may be deemed to beneficially own and has sole dispositive power with respect to all shares listed in the table and has sole voting power with respect to 16,722,365 shares. The address of the principal place of business of BlackRock is 55 East 52nd Street, New York, New York, 10022.
​
(5)
According to a Schedule 13G filed February 14, 2022, filed by Dodge & Cox, in its capacity as investment adviser, may be deemed to beneficially own and has sole dispositive power with respect to all shares listed in the table and has sole voting power with respect to 15,965,436 shares. The address of the principal place of business of Dodge & Cox is 555 California Street, 40th Floor, San Francisco, California 94104.
​
(6)
Includes 843,393 shares subject to RSUs and earned performance shares that will vest and options exercisable within 60 days of April 18, 2022.
​
(7)
Includes 92,857 shares subject to RSUs and earned performance shares that will vest and options exercisable within 60 days of April 18, 2022.
​
(8)
Includes 153,573 shares subject to RSUs and earned performance shares that will vest and options exercisable within 60 days of April 18, 2022.
​
(9)
Includes 124,157 shares subject to RSUs and earned performance shares that will vest and options exercisable within 60 days of April 18, 2022.
​
(10)
Includes 72,292 shares subject to RSUs and earned performance shares that will vest and options exercisable within 60 days of April 18, 2022.
​
(11)
Includes 122,919 shares subject to RSUs that will vest and options exercisable within 60 days of April 18, 2022.
​
(12)
Includes 7,165 shares subject to RSUs that will vest and options exercisable within 60 days of April 18, 2022.
​
(13)
Includes 122,919 shares subject to RSUs that will vest and options exercisable within 60 days of April 18, 2022.
​
(14)
Includes 127,919 shares subject to RSUs that will vest and options exercisable within 60 days of April 18, 2022.
​
(15)
Includes 81,669 shares subject to RSUs that will vest and options exercisable within 60 days of April 18, 2022.
​
(16)
Includes 24,807 shares subject to RSUs that will vest and options exercisable within 60 days of April 18, 2022.
​
(17)
Includes 13,722 shares subject to RSUs that will vest and options exercisable within 60 days of April 18, 2022.
​
(18)
Includes shares pursuant to the second paragraph of note (2) and notes (6), (7), (8), (9), (10), (11), (12), (13), (14), (15), (16), and (17) above, and 358,490 shares subject to RSUs and earned performance shares that will vest and options exercisable within 60 days of April 18, 2022 held by other executive officers of the Company.
​
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​​    Security Ownership of Certain Beneficial Owners and Management    

(10)

Includes 176,788 shares subject to options exercisable within 60 days of March 12, 2019. Does not include 5,416 shares underlying RSUs and 5,389 shares underlying performance shares that will remain unvested within 60 days of March 12, 2019.

(11)

Ms. Pasquale was appointed Executive Vice President and General Counsel effective April 2018. Includes 11,156 shares subject to options exercisable within 60 days of March 12, 2019. Does not include 4,446 shares underlying RSUs and 5,389 shares underlying performance shares that will remain unvested within 60 days of March 12, 2019.

(12)

Includes 90,000 shares subject to options exercisable within 60 days of March 12, 2019.

(13)

Includes 155,000 shares subject to options exercisable within 60 days of March 12, 2019.

(14)

Includes 90,000 shares subject to options exercisable within 60 days of March 12, 2019.

(15)

Includes 188,314 shares subject to options exercisable within 60 days of March 12, 2019.

(16)

Includes 32,604 shares subject to options exercisable within 60 days of March 12, 2019.

(17)

Includes 182,500 shares subject to options exercisable within 60 days of March 12, 2019.

(18)

Includes shares included pursuant to the second paragraph of note (2) and notes (6), (9), (10), (11), (12), (13), (14), (15), (16), and (17) above and 250,737 shares subject to options exercisable within 60 days of March 12, 2019 held by other executive officers of the Company. Does not include 133,639 shares underlying RSUs and 53,305 shares underlying performance shares that will remain unvested within 60 days of March 12, 2019.

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Other Matters

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Section 16(a) Beneficial Ownership Reporting Compliance

Under the securities laws of the United States, our directors, executive officers and any persons holding more than 10% of our common stock are required to report their initial ownership of our common stock and any subsequent changes in that ownership to the Securities and Exchange Commission. Specific due dates for these reports have been established and we are required to identify in this Proxy Statement those persons who failed to timely file these reports. Based solely on our review of the copies of such forms received by us, or written representation from certain reporting persons, we believe that all of the filing requirements for such persons were satisfied for 2018.

2021.

Stockholder Proposals for the 20202023 Annual Meeting

To be considered for inclusion in the Company’s proxy statement for the Company’s 20202023 Annual Meeting of Stockholders, stockholder proposals must be received by the Secretary of the Company no later than November 26, 2019.December 30, 2022. These proposals also must comply with the proxy proposal submission rules of the Securities and Exchange Commission underRule 14a-8.

A stockholder proposal not included in the Company’s proxy statement for the 20202023 Annual Meeting will be ineligible for presentation at the meeting unless the stockholder gives timely notice of the proposal in writing to the Secretary of the Company at the principal executive offices of the Company, provides the information required by the Company’s Bylaws, and otherwise complies with the provisions of the Company’s Bylaws. To be timely, our Bylaws provide that the Company must have received the stockholder’s notice not less than 90 days nor more than 120 days prior to the first anniversary of the preceding year’s annual meeting of stockholders. However, in the event that the 20202023 Annual Meeting is called for a date that is more than 30 days before or more than 60 days after the first anniversary date of the preceding year’s annual meeting of stockholders, notice by the stockholder to be timely must be so received by the Secretary of the Company not later than the close of business on the later of (1) the 90th day prior to the date of the meeting and (2) the 10th day following the first public announcement or disclosure of the date of the 20202023 Annual Meeting.

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Annual Report

We will furnish without charge, upon written request of any person who was a stockholder or beneficial owner of common stock at the close of business on March 12, 2019,April 18, 2022, the record date, a copy of our Annual Report onForm 10-K, including the financial statements, the financial statement schedules, and all exhibits. The written request should be sent to: Investor Relations Department, Incyte Corporation, 1801 AugustineCut-Off, Wilmington, DE 19803.

Whether you intend to be present at the Annual Meeting or not, we urge you to vote by telephone, the internet, or by signing and mailing the enclosed proxy promptly.

By Order of the Board of Directors
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Hervé Hoppenot
President and Chief Executive Officer
April 29, 2022

By Order of the Board of Directors

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Hervé Hoppenot
President and Chief Executive Officer

March 21, 2019

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Frequently Asked Questions
​
Will there be any other items of business on the agenda?
We do not expect any other items of business because the deadline for stockholder proposals and nominations has already passed. Nonetheless, in case there is an unforeseen need, the accompanying proxy gives discretionary authority to the persons named on the proxy with respect to any other matters that might be brought before the meeting. Those persons intend to vote that proxy in accordance with their best judgment.
Why did I receive a one-page notice in the mail regarding the Internet availability of proxy materials instead of a full set of proxy materials?
We have elected to provide access to our proxy materials over the Internet, as permitted by the rules of the SEC. Accordingly, in most instances we are mailing a Notice of Internet Availability of Proxy Materials (Proxy Availability Notice) to our stockholders. All stockholders will have the ability to access our proxy materials on the website referred to in the Proxy Availability Notice or may request to receive printed versions of our proxy materials for the Annual Meeting. Instructions on how to access the proxy materials over the Internet or to request a printed copy may be found in the Proxy Availability Notice.
We intend to mail the Proxy Availability Notice on or about April 29, 2022 to all stockholders of record entitled to vote at the Annual Meeting. We expect that this Proxy Statement and the other proxy materials will be available to stockholders on or about April 29, 2022.
What does it mean if I receive more than one notice regarding the Internet availability of proxy materials or more than one set of printed proxy materials?
If you hold your shares in more than one account, you may receive a separate Proxy Availability Notice or a separate set of printed proxy materials, including a separate proxy voting card or voting instruction form, for each account. To ensure that all of your shares are voted, please vote by telephone or by Internet or sign, date and return a proxy card or voting instruction form for each account.
Who is entitled to vote?
Stockholders of record at the close of business on April 18, 2022, the Record Date, may vote at the Annual Meeting. Each stockholder is entitled to one vote for each share of our common stock held by such stockholder as of the Record Date.
How many shares must be present to hold the Annual Meeting?
The presence, in person or by proxy, of the holders of a majority of our outstanding common stock on the Record Date constitutes a quorum, which is required to hold and conduct business at the Annual Meeting. As of the close of business on the Record Date, there were 221,496,070 shares of our common stock outstanding. If you are a record holder and you submit your proxy, regardless of whether you abstain from voting on one or more matters, your shares will be counted as present at the Annual Meeting for purposes of determining a quorum. If your shares are held in street name, your shares are counted as present for purposes of determining a quorum if your broker, bank or other nominee submits a proxy covering your shares. Your broker, bank or other nominee is entitled to submit a proxy covering your shares as to certain “routine” matters, even if you have not instructed your broker, bank or other nominee on how to vote on those matters. Please see “How are votes counted?” below. If a quorum is not present, we expect that the Annual Meeting will be adjourned until we obtain a quorum.
What is the difference between holding shares as a stockholder of record and as a beneficial owner?
Stockholder of Record.  If your shares are registered directly in your name with our transfer agent, Computershare, you are considered, with respect to those shares, the “stockholder of record.” This Proxy Statement, our Annual Report and the proxy card have been sent directly to you by Incyte.
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Beneficial Owner.  If your shares are held in a stock brokerage account or by a broker, bank or other nominee, you are considered the “beneficial owner” of shares held in street name. This Proxy Statement and our Annual Report have been forwarded to you by your broker, bank or other nominee who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker, bank or other nominee how to vote your shares by using the voting instruction form provided by your broker, bank or other nominee.
How do I vote?
You may vote using any of the following methods:
​By Mail​​By Telephone​​By Internet​​In Person at the Annual Meeting*​
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​Mail—Follow the instructions in your proxy materials.​​Telephone—Stockholders of record may call toll-free 1-800-652—VOTE (8683)​​By Internet—Stockholders of record may vote online at www.envisionreports.com/INCY​​In Person at the Annual Meeting—You may obtain directions to the Annual Meeting by contacting our Company’s Investor Relations Department at (302) 498-6700.​
​​​​Most stockholders who hold shares beneficially in street name may provide voting instructions to their brokers, banks or other nominees by telephone by calling the number specified on the voting instruction form provided by their brokers, banks or other nominees. The telephone voting facilities will close at 11:59 pm, Eastern Daylight Time, the day before the meeting date.​​Most stockholders who hold shares beneficially in street name may provide voting instructions to their brokers, banks or other nominees by accessing the website specified on the voting instruction form provided by their brokers, banks or other nominees. The internet voting facilities will close at 11:59 pm, Eastern Daylight Time, the day before the meeting date.​​Even if you plan to attend the Annual Meeting, we recommend that you also submit your proxy or voting instructions or vote by telephone or the internet so that your vote will be counted if you later decide not to attend the meeting.​
​
*
We intend to hold our Annual Meeting in person. However, we continue to monitor the coronavirus (COVID-19) situation and are sensitive to the public health and travel concerns our stockholders may have and the protocols that federal, state, and local governments may impose. If stockholder attendance is not permitted or we determine that it is not in the best interest of our employees, stockholders and community to permit stockholder attendance, we will announce alternative arrangements for the meeting as promptly as practicable, which may include holding the meeting solely by means of remote communication. If we take this step, we will announce the decision to do so via a press release, and will post details on how to participate on our website and file additional proxy materials with the SEC. Please note that Incyte requires all visitors to provide proof of COVID-19 vaccination.
​
Can I change my vote or revoke my proxy?
You may change your vote or revoke your proxy at any time prior to the vote at the Annual Meeting. If you submitted your proxy by mail, you must file with the Secretary of our Company a written notice of revocation or deliver, prior to the vote at the Annual Meeting, a valid, later dated proxy. If you submitted your proxy by telephone or the internet, you may change your vote or revoke your proxy with a later telephone or internet proxy, as the case may be. Attendance at the Annual Meeting will not have the effect of revoking a proxy unless you give written notice of revocation to the Secretary before the proxy is exercised or you vote by written ballot at the Annual Meeting. For shares you hold beneficially in street name, you may change your vote or revoke your proxy by submitting new voting instructions to or informing your broker, bank or other nominee in accordance that entity’s procedures for changing or revoking your voting instructions.
How are votes counted?
In the election of directors, you may vote “FOR,” “AGAINST” or “ABSTAIN” for each nominee. For each of Proposals 2 and 3, you may vote “FOR,” “AGAINST” or “ABSTAIN.”
If you provide specific instructions, your shares will be voted as you instruct. If you sign your proxy card or voting instruction form with no further instructions, your shares will be voted in accordance with the recommendations of the Board (“FOR” all of the nominees to the Board of Directors, “FOR” the approval of the compensation of our named executive officers, “FOR” the ratification of the independent registered public accounting firm and, in the discretion of the proxy holders, on any other matters that may properly come before the meeting.
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​Frequently Asked Questions​
If you hold shares beneficially in street name and do not provide your broker, bank or other nominee with voting instructions, your shares may constitute “broker non-votes.” Generally, broker non-votes occur on a matter when a broker, bank or other nominee is not permitted to vote on that matter without instructions from the beneficial owner and instructions are not given. If you hold shares beneficially in street name and do not vote your shares, your broker, bank or other nominee can vote your shares at its discretion only on Proposal 3, the ratification of the independent registered public accounting firm. In tabulating the voting result for any particular proposal, shares that constitute broker non-votes are not considered entitled to vote on that proposal. Thus, broker non-votes will not affect the outcome of any matter being voted on at the Annual Meeting, other than Proposal 3, assuming that a quorum is obtained.
What vote is required to approve each item?
We have a majority voting standard for the election of directors in an uncontested election, which is generally defined as an election in which the number of nominees does not exceed the number of directors to be elected at the meeting. Cumulative voting is not permitted, which means that each stockholder may vote no more than the number of shares he or she owns for a single director candidate. Under our majority voting standard, in uncontested elections of directors, such as this election, each director must be elected by the affirmative vote of a majority of the votes cast by the shares present in person or represented by proxy. A “majority of the votes cast” means that the number of votes cast “FOR” a director nominee exceeds the number of votes cast “AGAINST” the nominee. If a director nominee is an incumbent director and does not receive a majority of the votes cast in an uncontested election, that director will continue to serve on the Board as a “holdover” director, but will be subject to our director resignation policy. Additional information concerning our director resignation policy is set forth under the heading “Corporate Governance—Majority Voting Policy.”
The table below describes the proposals to be considered at the Annual Meeting and the vote required for each proposal:
Proposal​​Vote Required​​Effect of
Abstentions(1)		​​Broker
Discretionary
Voting Allowed?(2)		​​​​
1​​Election of Directors​​A nominee for director will be elected if the votes cast “FOR” such nominee exceed the votes cast “AGAINST” such nominee.​​
No effect
Not considered votes cast on this proposal
​​
No
Brokers without voting instructions will not be able to vote on this proposal
​​
2​​Advisory Vote to Approve Executive Compensation​​Non-binding, advisory proposal. We will consider the matter approved if it receives the affirmative vote of a majority of the shares of common stock present at the Annual Meeting in person or by proxy and entitled to vote on this proposal.​​
Counted as vote
Same effect as votes against
​​
No
Brokers without voting instructions will not be able to vote on this proposal
​​
3​​Ratification of the Appointment of Ernst & Young LLP​​The affirmative “FOR” vote of a majority of the shares present at the Annual Meeting in person or by proxy and entitled to vote on this proposal.​​
Counted as vote
Same effect as votes against
​​
Yes
Brokers without voting instructions will have discretionary authority to vote
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​
(1)
As noted above, abstentions will be counted as present for purposes of establishing a quorum at the Annual Meeting.
​
(2)
Only relevant if you are the beneficial owner of shares held in street name. If you are a stockholder of record and you do not cast your vote, no votes will be cast on your behalf on any of the items of business at the Annual Meeting.
​
If any other matter is properly brought before the Annual Meeting, such matter also will be determined by the affirmative vote of a majority of the shares of common stock present at the Annual Meeting in person or by proxy and entitled to vote at the Annual Meeting.
What is “householding” and how does it affect me?
We have adopted a process for mailing our Annual Report and this Proxy Statement called “householding,” which has been approved by the Securities and Exchange Commission. Householding means that stockholders who share
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​Frequently Asked Questions​
the same last name and address will receive only one copy of our Annual Report and this Proxy Statement, unless we receive contrary instructions from any stockholder at that address. We will continue to mail a proxy card to each stockholder of record.
If you prefer to receive multiple copies of our Annual Report and this Proxy Statement at the same address, additional copies will be provided to you upon request. If you are a stockholder of record, you may contact us by writing to Investor Relations Department, Incyte Corporation, 1801 Augustine Cut-Off, Wilmington, Delaware 19803 or by calling (302) 498-6700 and asking for Investor Relations. Eligible stockholders of record receiving multiple copies of our Annual Report and this Proxy Statement can request householding by contacting us in the same manner. We have undertaken householding to reduce printing costs and postage fees, and we encourage you to participate.
If you are a beneficial owner, you may request additional copies of our Annual Report and this Proxy Statement or you may request householding by notifying your broker, bank or other nominee.
How are proxies solicited?
Our employees, officers and directors may solicit proxies. We will pay the cost of printing and mailing proxy materials, and will reimburse brokerage houses and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation material to the owners of our common stock. In addition, we have engaged D.F. King & Co., Inc. to assist us in soliciting proxies for a fee of $12,500, plus out-of-pocket expenses.
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Appendix A

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​
Note Regarding Forward-Looking Statements
Forward-Looking Statements

Except for the historical information set forth herein, the matters set forth in this proxy statement contain predictions, estimates and otherforward-looking statements, including without limitation statements regarding: our beliefexpectation that our pipeline may provide us near-term opportunities for additional2021 new product launches will contribute more meaningfully to revenue growth and increased diversity, our expectations regarding NDA submissions for pemigatinib, itacitinib and capmatinib,going forward; our expectations regarding the timingsubmission of clinical trial resultsonce-a-day ruxolitinib to the FDA; our expectations regarding the size of the opportunity for ruxolitinib and itacitinib in GVHD, parsaclisib, INCMGA0012, ruxolitinib cream in vitiligo and baricitinib,other indications; our expectations regarding expanded development and additional trials of axatilimab; our expectations regarding selecting a lead PD-L1 program; our expectations with respect to becoming an operationally carbon neutral organization and means to achieve that goal; our expectations regarding our ability to achieve our goal of transitioning our fleet to hybrid or electric vehicles and the timing of our report under TCFD; our expectations regarding our global responsibility initiative; and our beliefs regarding the benefits and effects of our compensation policies and methods, and our expectations to continue to expand our workforce.

methods.

Theseforward-looking statements are based on our current expectations and are subject to risks and uncertainties that may cause actual results to differ materially, including unanticipated delaysdevelopments in obtaining results from clinical trials, the ability to enroll sufficient numbers of subjects for our clinical trials,and risks relating torelated to: further research and development and the results of clinical trials possibly being unsuccessful or insufficient to meet applicable regulatory standards or warrant continued development; the ability to enroll sufficient numbers of subjects in clinical trials and the ability to enroll subjects in accordance with planned schedules; the effects of the COVID-19 pandemic and measures intended to limit the pandemic on our and our collaborators’ clinical trials, supply chain and other third-party providers, sales and marketing efforts and business, development and discovery operations; determinations made by the FDA, EMA and other regulatory authorities our dependence on our relationships with and changes in the plans of our collaboration partners; the efficacy or safety of our products and the products of our collaboration partners; the acceptance of our products and the products of our collaboration partners in the marketplace; the effects of market competition,competition; unexpected variations in the demand for our products and the products of our collaboration partners; the effects of announced or unexpected price regulation or limitations on reimbursement or coverage for our products and the products of our collaboration partners; risks related to our ability to achieve our environmental and global responsibility goals, including the costs involved in doing so, supply chain or other issues that could affect timing of achievement of goals, and changes in regulations, technology and other factors beyond our control; and other risks detailed from time to time in our reports filed with the Securities and Exchange Commission, including ourForm 10-K for the year ended December 31, 2018.2021. We disclaim any intent or obligation to update these forward lookingforward-looking statements.

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Appendix B

INCYTE CORPORATION

AMENDED AND RESTATED 2010 STOCK INCENTIVE PLAN

(As Amended and Restated

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Your vote matters – here’s how to vote!You may vote online or by phone instead of mailing this cardVotes submitted electronically must be received by 11:59pm, (EDT), on March 18, 2019)

INCYTE CORPORATION

AMENDEDAND RESTATED 2010 STOCK INCENTIVE PLAN

Table of Contents

Page

SECTION 1.

ESTABLISHMENT AND PURPOSE

1

SECTION 2.

DEFINITIONS

1

(a)

“Affiliate”

1

(b)

“Award”

1

(c)

“Board of Directors”

1

(d)

“Change in Control”

1

(e)

“Code”

2

(f)

“Committee”

2

(g)

“Corporation”

2

(h)

“Consultant”

2

(i)

“Employee”

3

(j)

“Exchange Act”

3

(k)

“Exercise Price”

3

(l)

“Fair Market Value”

3

(m)

“ISO”

3

(n)

“Nonstatutory Option” or “NSO”

4

(o)

“Offeree”

4

(p)

“Option”

4

(q)

“Optionee”

4

(r)

“Outside Director”

4

(s)

“Parent”

4

(t)

“Participant”

4

(u)

“Performance Shares”

4

(v)

“Performance Share Agreement”

4

(w)

“Plan”

4

(x)

“Purchase Price”

4

(y)

“Qualifying Performance Criteria”

4

(z)

“Restricted Share”

4

(aa)

“Restricted Share Agreement”

5

(bb)

“Restricted Stock Unit”

5

(cc)

“Restricted Stock Unit Agreement”

5

(dd)

“SAR”

5

INCYTE CORPORATION

AMENDEDAND RESTATED 2010 STOCK INCENTIVE PLAN

- i -

(ee)

“SAR Agreement”

5

(ff)

“Service”

5

(gg)

“Share”

5

(hh)

“Stock”

5

(ii)

“Stock Option Agreement”

5

(jj)

“Subsidiary”

5

(kk)

“Total and Permanent Disability”

6

SECTION 3.

ADMINISTRATION

6

(a)

Committee Composition

6

(b)

Committee forNon-Officer Grants

6

(c)

Committee Procedures

6

(d)

Committee Responsibilities

7

SECTION 4.

ELIGIBILITY

8

(a)

General Rule

8

(b)

Ten-Percent Stockholders

8

(c)

Attribution Rules

8

(d)

Outstanding Stock

8

SECTION 5.

STOCK SUBJECT TO PLAN

8

(a)

Basic Limitation

8

(b)

Award Limitation

9

(c)

Additional Shares

9

SECTION 6.

RESTRICTED SHARES

9

(a)

Restricted Share Agreement

9

(b)

Payment for Awards

10

(c)

Vesting

10

(d)

Voting and Dividend Rights

10

(e)

Restrictions on Transfer of Shares

10

SECTION 7.

TERMS AND CONDITIONS OF OPTIONS

10

(a)

Stock Option Agreement

10

(b)

Number of Shares

10

(c)

Exercise Price

11

(d)

Withholding Taxes

11

(e)

Exercisability and Term

11

(f)

Exercise of Options

11

(g)

Effect of Change in Control

11

(h)

No Rights as a Stockholder

12

INCYTE CORPORATION

AMENDEDAND RESTATED 2010 STOCK INCENTIVE PLAN

- ii -

(i)

Modification, Extension and Assumption of  Options

12

(j)

Restrictions on Transfer of Shares

12

(k)

Buyout Provisions

12

SECTION 8.

PAYMENT FOR SHARES

12

(a)

General Rule

12

(b)

Surrender of Stock

12

(c)

Services Rendered

13

(d)

Cashless Exercise

13

(e)

Exercise/Pledge

13

(f)

Promissory Note

13

(g)

Other Forms of Payment

13

(h)

Limitations under Applicable Law

13

SECTION 9.

STOCK APPRECIATION RIGHTS

13

(a)

SAR Agreement

13

(b)

Number of Shares

13

(c)

Exercise Price

14

(d)

Exercisability and Term

14

(e)

Effect of Change in Control

14

(f)

Exercise of SARs

14

(g)

Modification or Assumption of SARs

14

(h)

Buyout Provisions

14

SECTION 10.

RESTRICTED STOCK UNITS

15

(a)

Restricted Stock Unit Agreement

15

(b)

Payment for Awards

15

(c)

Vesting Conditions

15

(d)

Voting and Dividend Rights

15

(e)

Form and Time of Settlement of Restricted Stock Units

15

(f)

Death of Recipient

16

(g)

Creditors’ Rights

16

SECTION 11.

PERFORMANCE SHARES

16

(a)

Performance Shares and Performance Share Agreement

16

(b)

Payment for Awards

16

(c)

Terms of Performance Share Awards

17

(d)

Voting and Dividend Rights

17

(e)

Form and Time of Settlement of Performance Shares

17

(f)

Death of Recipient

18

(g)

Creditors’ Rights

18

INCYTE CORPORATION

AMENDEDAND RESTATED 2010 STOCK INCENTIVE PLAN

- iii -

SECTION 12.

AUTOMATIC GRANTS TO OUTSIDE DIRECTORS

18

(a)

Annual Grants

18

(b)

Vesting Conditions

19

(c)

Award Agreement

19

(d)

Additional Grants

19

SECTION 13.

ADJUSTMENT OF SHARES; REORGANIZATIONS

19

(a)

Adjustments

19

(b)

Dissolution or Liquidation

20

(c)

Reorganizations

20

(d)

Reservation of Rights

22

SECTION 14.

DEFERRAL OF AWARDS

22

(a)

Committee Powers

22

(b)

General Rules

22

(c)

Code Section 409A

23

SECTION 15.

PAYMENT OF DIRECTOR’S FEES IN SECURITIES

23

(a)

Effective Date

23

(b)

Elections to Receive NSOs, Restricted Shares or Restricted Stock Units

23

(c)

Number and Terms of NSOs, Restricted Shares or Restricted Stock Units

23

SECTION 16.

AWARDS UNDER OTHER PLANS

24

SECTION 17.

LEGAL AND REGULATORY REQUIREMENTS

24

SECTION 18.

WITHHOLDING TAXES

24

(a)

General

24

(b)

Share Withholding

24

SECTION 19.

OTHER PROVISIONS APPLICABLE TO AWARDS

24

(a)

Transferability

24

(b)

Qualifying Performance Criteria

25

(c)

Vesting Restrictions on Awards

26

SECTION 20.

NO EMPLOYMENT RIGHTS

26

SECTION 21.

APPLICABLE LAW

26

SECTION 22.

DURATION AND AMENDMENTS

26

(a)

Term of the Plan

26

(b)

Right to Amend or Terminate the Plan

26

(c)

Effect of Termination

26

INCYTE CORPORATION

AMENDEDAND RESTATED 2010 STOCK INCENTIVE PLAN

- iv -

INCYTE CORPORATION

AMENDED AND RESTATED 2010 STOCK INCENTIVE PLAN

SECTION 1.

ESTABLISHMENT AND PURPOSE.

The Plan was adopted byJune 14, 2022Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the Board of Directors on March 19, 2010, amended and restated on March 8, 2011, April 18, 2012, and April 17, 2013, amended on January 7, 2014, March 4, 2014, April 22, 2014, March 16, 2016 and March 2, 2018, and further amended and restated on March 18, 2019. The purpose ofdesignated areas.OnlineGo to www.envisionreports.com/INCY or scan the Plan is to promote the long-term success of the Corporation and the creation of stockholder value by (a) encouraging Employees, Outside Directors and Consultants to focus on critical long-range objectives, (b) encouraging the attraction and retention of Employees, Outside Directors and Consultants with exceptional qualifications and (c) linking Employees, Outside Directors and Consultants directly to stockholder interests through increased stock ownership. The Plan seeks to achieve this purpose by providing for AwardsQR code — login details are located in the form of Restricted Shares, Restricted Stock Units, Performance Shares, Options (which may constitute ISOs or NSOs)shaded bar below.PhoneCall toll free 1-800-652-VOTE (8683) within the USA, US territories and SARs.

SECTION 2.

DEFINITIONS.

(a)

“Affiliate” shall mean any entity other than a Subsidiary, if the Corporation and/or one or more Subsidiaries own not less than 50% of such entity.

(b)

“Award” shall mean any award of an Option, a SAR, Restricted Shares, Restricted Stock Units or Performance Shares under the Plan.

(c)

“Board of Directors” shall mean the Board of Directors of the Corporation, as constituted from time to time.

(d)

“Change in Control” shall mean the occurrence of any of the following events:

(i)

A change in the composition of the Board of Directors, as a result of which fewer thanone-half of the incumbent directors are directors who either:

(A)

Had been directors of the Corporation 24 months prior to such change; or

(B)

Were elected, or nominated for election, to the Board of Directors with the affirmative votes of at least a majority of the directors who had been directors of the Corporation 24 months prior to such change and who were still in office at the time of the election or nomination; or

(ii)

Any “person” (as defined below) by the acquisition or aggregation of securities is or becomes the beneficial owner (as defined in Rule13d-3 of

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the Exchange Act), directly or indirectly, of securities of the Corporation representing 50% or more of the combined voting power of the Corporation’s then outstanding securities ordinarily (and apart from rights accruing under special circumstances) having the right to vote at elections of directors (the “Base Capital Stock”); except that any change in the relative beneficial ownership of the Corporation’s securities by any person resulting solely from a reduction in the aggregate number of outstanding shares of Base Capital Stock, and any decrease thereafter in such person’s ownership of securities, shall be disregarded until such person increases in any manner, directly or indirectly, such person’s beneficial ownership of any securities of the Corporation; or

(iii)

The consummation of a merger or consolidation of the Corporation with or into another entity or any other corporate reorganization, if persons who were not stockholders of the Corporation immediately prior to such merger, consolidation or other reorganization own immediately after such merger, consolidation or other reorganization 50% or more of the voting power of the outstanding securities of (A) the continuing or surviving entity and (B) any direct or indirect parent corporation of such continuing or surviving entity; or

(iv)

The consummation of the sale, transfer or other disposition of all or substantially all of the assets of the Corporation.

For purposes of subsection (d)(ii) above, the term “person” shall have the same meaning as when used in Sections 13(d) and 14(d) of the Exchange Act but shall exclude (1) a trustee or other fiduciary holding securities under an employee benefit plan maintained by the Corporation or a Parent or Subsidiary and (2) a corporation owned directly or indirectly by the stockholders of the Corporation in substantially the same proportions as their ownership of the Stock.

Any other provision of this Section 2(d) notwithstanding, a transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Corporation’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Corporation’s securities immediately before such a transaction.

(e)

“Code” shall mean the Internal Revenue Code of 1986, as amended.

(f)

“Committee” shall mean the committee designated by the Board of Directors to administer the Plan, as described in Section 3 hereof (or in the absence of such designation, the Board of Directors itself).

(g)

“Corporation” shall mean Incyte Corporation, a Delaware corporation.

(h)

“Consultant” shall mean a consultant or advisor who provides bona fide services to the Corporation, a Parent, a Subsidiary or an Affiliate as an independent

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contractor (not including service as a member of the Board of Directors) or a member of the board of directors of a Parent or a Subsidiary, in each case who is not an Employee.

(i)

“Employee” shall mean any individual who is acommon-law employee of the Corporation, a Parent, a Subsidiary or an Affiliate.

(j)

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

(k)

“Exercise Price” shall mean (a) in the case of an Option, the amount for which one Share may be purchased upon exercise of such Option, as specified in the applicable Stock Option Agreement, and (b) in the case of a SAR, an amount, as specified in the applicable SAR Agreement, which is subtracted from the Fair Market Value of one Share in determining the amount payable upon exercise of such SAR.

(l)

“Fair Market Value” with respect to a Share, shall mean the market price of one Share, determined by the Committee as follows:

(i)

If the Stock was traded on The Nasdaq Stock Market, then the Fair Market Value shall be equal to the last reported sale price reported for such date by The Nasdaq Stock Market; or

(ii)

If the Stock was not traded on The Nasdaq Stock Market but was traded on another United States stock exchange on the date in question, then the Fair Market Value shall be equal to the closing price reported for such date by the applicable composite-transactions report; or

(iii)

If the Stock was tradedover-the-counter on the date in question, then the Fair Market Value shall be equal to the last reported sale price reported for such date by the OTC Bulletin Board or, if not so reported, shall be equal to the closing sale price quoted for such date by OTC Markets Group Inc. or similar organization or, if no last reported or closing sale price is reported, shall be equal to the mean between the last reported representative bid and asked prices quoted for such date by the OTC Bulletin Board or, if the Stock is not quoted on the OTC Bulletin Board, by OTC Markets Group Inc. or similar organization; or

(iv)

If none of the foregoing provisions is applicable, then the Fair Market Value shall be determined by the Committee in good faith on such basis as it deems appropriate.

In all cases, the determination of Fair Market Value by the Committee shall be conclusive and binding on all persons.

(m)

“ISO” shall mean an employee incentive stock option described in Section 422 of the Code.

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(n)

“Nonstatutory Option” or “NSO” shall mean an employee stock option that is not an ISO.

(o)

“Offeree” shall mean an individual to whom the Committee has offered the right to acquire Shares under the Plan (other than upon exercise of an Option).

(p)

“Option” shall mean an ISO or Nonstatutory Option granted under the Plan and entitling the holder to purchase Shares.

(q)

“Optionee” shall mean an individual or estate who holds an Option or SAR.

(r)

“Outside Director” shall mean a member of the Board of Directors who is not an Employee or a Consultant.

(s)

“Parent” shall mean any corporation or other entity (other than the Corporation) in an unbroken chain of corporations or other entities ending with the Corporation, if each of the corporations or other entities other than the Corporation owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. A corporation or other entity that attains the status of a Parent on a date after the adoption of the Plan shall be a Parent commencing as of such date.

(t)

“Participant” shall mean an individual or estate who holds an Award.

(u)

“Performance Shares” shall mean a bookkeeping entry representing the Corporation’s obligation to deliver Shares (or distribute cash) on a future date in accordance with the provisions of a Performance Share Agreement.

(v)

“Performance Share Agreement” shall mean the agreement between the Corporation and the recipient of Performance Shares that contains the terms, conditions and restrictions pertaining to such Performance Shares.

(w)

“Plan” shall mean this Amended and Restated 2010 Stock Incentive Plan of Incyte Corporation, as amended from time to time.

(x)

“Purchase Price” shall mean the consideration for which one Share may be acquired under the Plan (other than upon exercise of an Option), as specified by the Committee.

(y)

“Qualifying Performance Criteria” shall have the meaning set forth in Section 19(b).

(z)

“Restricted Share” shall mean a Share awarded under the Plan and subject to the terms, conditions and restrictions set forth in a Restricted Share Agreement.

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(aa)

“Restricted Share Agreement” shall mean the agreement between the Corporation and the recipient of a Restricted Share that contains the terms, conditions and restrictions pertaining to such Restricted Shares.

(bb)

“Restricted Stock Unit” shall mean a bookkeeping entry representing the Corporation’s obligation to deliver one Share (or distribute cash) on a future date in accordance with the provisions of a Restricted Stock Unit Agreement.

(cc)

“Restricted Stock Unit Agreement” shall mean the agreement between the Corporation and the recipient of a Restricted Stock Unit that contains the terms, conditions and restrictions pertaining to such Restricted Stock Unit.

(dd)

“SAR” shall mean a stock appreciation right granted under the Plan.

(ee)

“SAR Agreement” shall mean the agreement between the Corporation and an Optionee that contains the terms, conditions and restrictions pertaining to his or her SAR.

(ff)

“Service” shall mean service as an Employee, Consultant or Outside Director, subject to such further limitations as may be set forth in the Plan or the applicable Stock Option Agreement, SAR Agreement, Restricted Share Agreement, Restricted Stock Unit Agreement or Performance Share Agreement. Service does not terminate when an Employee goes on a bona fide leave of absence, that was approved by the Corporation in writing, if the terms of the leave provide for continued Service crediting, or when continued Service crediting is required by applicable law. However, for purposes of determining whether an Option is entitled to ISO status, an Employee’s employment will be treated as terminating 90 days after such Employee went on leave, unless such Employee’s right to return to active work is guaranteed by law or by a contract. Service terminates in any event when the approved leave ends, unless such Employee immediately returns to active work. The Corporation shall be entitled to determine in its sole discretion which leaves of absence count toward Service, and when Service terminates for all purposes under the Plan.

(gg)

“Share” shall mean one share of Stock, as adjusted in accordance with Section 13 (if applicable).    

(hh)

“Stock” shall mean the common stock of the Corporation, $.001 par value per share.

(ii)

“Stock Option Agreement” shall mean the agreement between the Corporation and an Optionee that contains the terms, conditions and restrictions pertaining to such Option.

(jj)

“Subsidiary” shall mean any corporation, if the Corporation or one or more other Subsidiaries own not less than 50% of the total combined voting power of all classes of outstanding stock of such corporation. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date.

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(kk)

“Total and Permanent Disability” shall mean that the Optionee is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted, or can be expected to last for a continuous period of not less than one year.

SECTION 3.

ADMINISTRATION.

(a)

Committee Composition. The Plan shall be administered by the Board of Directors or a Committee appointed by the Board of Directors. The Committee shall consist of two or more members of the Board of Directors. In addition, to the extent required by the Board of Directors, the composition of the Committee shall satisfy (i) such requirements as the Securities and Exchange Commission may establish for administrators acting under plans intended to qualify for exemption under Rule16b-3 (or its successor) under the Exchange Act; and (ii) such requirements as the Internal Revenue Service may establish for outside directors acting under plans intended to qualify for exemption under Section 162(m)(4)(C) of the Code.

(b)

Committee forNon-Officer Grants. The Board of Directors may also appoint one or more separate committees of the Board of Directors, each composed of one or more members of the Board of Directors who need not satisfy the requirements of Section 3(a), who may administer the Plan with respect to Employees who are not considered officers or directors of the Corporation under Section 16 of the Exchange Act, may grant Awards under the Plan to such Employees and may determine all terms of such grants. Within the limitations of the preceding sentence, any reference in the Plan to the Committee shall include such committee or committees appointed pursuant to the preceding sentence. To the extent permitted by applicable laws, the Board of Directors may also authorize one or more officers of the Corporation to designate Employees, other than persons subject to Section 16 of the Exchange Act, to receive Awards and to determine the number of such Awards to be received by such Employees.

(c)

Committee Procedures. The Board of Directors shall designate one of the members of the Committee as chairman. The Committee may hold meetings at such times and places as it shall determine. The acts of a majority of the Committee members present at meetings at which a quorum exists, or acts reduced to or approved in writing (including via email) by all Committee members, shall be valid acts of the Committee.

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(d)

Committee Responsibilities. Subject to the provisions of the Plan, the Committee shall have full authority and discretion to take the following actions:

(i)

To interpret the Plan and to apply its provisions;

(ii)

To adopt, amend or rescind rules, procedures and forms relating to the Plan;

(iii)

To adopt, amend or terminatesub-plans established for the purpose of satisfying applicable foreign laws, including qualifying for preferred tax treatment under applicable foreign tax laws;

(iv)

To authorize any person to execute, on behalf of the Corporation, any instrument required to carry out the purposes of the Plan;

(v)

To determine when Awards are to be granted under the Plan;

(vi)

To select the Offerees and Optionees;

(vii)

To determine the number of Shares to be made subject to each Award;

(viii)

To prescribe the terms and conditions of each Award, including the Exercise Price, the Purchase Price, the performance criteria, the performance period, and the vesting or duration of the Award (including accelerating the vesting of Awards, either at the time of the Award or thereafter, without the consent of the Participant), to determine whether an Option is to be classified as an ISO or as a Nonstatutory Option, and to specify the provisions of the agreement relating to such Award;

(ix)

To amend any outstanding Award agreement, subject to applicable legal restrictions and to the consent of the Participant if the Participant’s rights or obligations would be materially impaired;

(x)

To prescribe the consideration for the grant of each Award or other right under the Plan and to determine the sufficiency of such consideration;

(xi)

To determine the disposition of each Award or other right under the Plan in the event of a Participant’s divorce or dissolution of marriage;

(xii)

To determine whether Awards under the Plan will be granted in replacement of other grants under an incentive or other compensation plan of an acquired business;

(xiii)

To correct any defect, supply any omission, or reconcile any inconsistency in the Plan or any Award agreement;

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(xiv)

To establish or verify the extent of satisfaction of any performance goals or other conditions applicable to the grant, issuance, exercisability, vesting and/or ability to retain any Award; and

(xv)

To take any other actions deemed necessary or advisable for the administration of the Plan.

Subject to the requirements of applicable law, the Committee may designate persons other than members of the Committee to carry out its responsibilities and may prescribe such conditions and limitations as it may deem appropriate, except that the Committee may not delegate its authority with regard to the selection for participation of or the granting of Awards under the Plan to persons subject to Section 16 of the Exchange Act. All decisions, interpretations and other actions of the Committee shall be final and binding on all Participants, and all persons deriving their rights from a Participant. No member of the Committee shall be liable for any action that he or she has taken or has failed to take in good faith with respect to the Plan or any Award.

SECTION 4.

ELIGIBILITY.

(a)

General Rule. Only Employees shall be eligible for the grant of ISOs. Only Employees, Consultants and Outside Directors shall be eligible for the grant of Restricted Shares, Restricted Stock Units, Performance Shares, Nonstatutory Options or SARs.

(b)

Ten-Percent Stockholders. An Employee who owns more than 10% of the total combined voting power of all classes of outstanding stock of the Corporation, a Parent or Subsidiary shall not be eligible for the grant of an ISO unless such grant satisfies the requirements of Section 422(c)(5) of the Code.

(c)

Attribution Rules. For purposes of Section 4(b) above, in determining stock ownership, an Employee shall be deemed to own the stock owned, directly or indirectly, by or for such Employee’s brothers, sisters, spouse, ancestors and lineal descendants. Stock owned, directly or indirectly, by or for a corporation, partnership, estate or trust shall be deemed to be owned proportionately by or for its stockholders, partners or beneficiaries.

(d)

Outstanding Stock. For purposes of Section 4(b) above, “outstanding stock” shall include all stock actually issued and outstanding immediately after the grant but shall not include shares authorized for issuance under outstanding options held by the Employee or by any other person.

SECTION 5.

STOCK SUBJECT TO PLAN.

(a)

Basic Limitation. Shares offered under the Plan shall be authorized but unissued Shares or treasury Shares. The aggregate number of Shares authorized for issuance as Awards under the Plan shall not exceed 44,453,475. The limitation of this Section 5(a) shall be subject to adjustment pursuant to Section 13. Any

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Shares issued in connection with Options and SARs shall be counted against this limitation as one Share for every one Share so issued. Any Shares issued in connection with Awards other than Options and SARs shall be counted against this limitation as 2.0 Shares for every one Share so issued. The number of Shares that are subject to Awards outstanding at any time under the Plan shall not exceed the number of Shares which then remain available for issuance under the Plan. The Corporation, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares tendered or withheld in full or partial payment of the Exercise Price of an Award or to satisfy tax withholding obligations in connection with an Award, and Shares issued under an Award that are purchased by the Corporation on the open market, shall not be available for future issuance under the Plan.

(b)

Award Limitation. Subject to the provisions of Section 13, no Participant may receive Awards under the Plan in any calendar year that relate to more than 800,000 Shares.

(c)

Additional Shares. If an Award expires or becomes unexercisable without having been exercised in full, or, with respect to Restricted Shares, Restricted Stock Units or Performance Shares, is forfeited to or repurchased by the Corporation due to failure to vest, the unpurchased Shares (or for Awards other than Options or SARs the forfeited or repurchased Shares) which were subject thereto will become available for future grant or sale under the Plan (unless the Plan has terminated). With respect to SARs, when a stock settled SAR is exercised, all of the Shares subject to the SAR shall be counted against the number of Shares available for future grant or sale under the Plan, regardless of the number of Shares actually issued pursuant to such exercise. Shares that have actually been issued under the Plan under any Award will not be returned to the Plan and will not become available for future distribution under the Plan;provided,however, that if Shares issued pursuant to Awards of Restricted Shares, Restricted Stock Units or Performance Shares are repurchased by the Corporation or are forfeited to the Corporation, such Shares will become available for future grant under the Plan. To the extent an Award under the Plan is paid out in cash rather than Shares, such cash payment will not result in reducing the number of Shares available for issuance under the Plan.

SECTION 6.

RESTRICTED SHARES.

(a)

Restricted Share Agreement. Each grant of Restricted Shares under the Plan shall be evidenced by a Restricted Share Agreement between the recipient and the Corporation. Such Restricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Restricted Share Agreements entered into under the Plan need not be identical.

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(b)

Payment for Awards. Restricted Shares may be sold or awarded under the Plan for such consideration as the Committee may determine, including cash, cash equivalents, full-recourse promissory notes, past services and future services.

(c)

Vesting. Each Award of Restricted Shares shall vest over a minimum period of three years of the Participant’s Service, subject to Section 19(c). Vesting shall occur, in full or in installments, upon satisfaction of such Service requirement and such other conditions specified in the Restricted Share Agreement. A Restricted Share Agreement may provide for accelerated vesting in the event of the Participant’s death, Total and Permanent Disability or retirement or other events. The Committee may determine, at the time of granting Restricted Shares or thereafter, that all or part of such Restricted Shares shall become vested upon a Change in Control. Except as may be set forth in a Restricted Share Agreement, vesting of the Restricted Shares shall cease on the termination of the Participant’s Service.

(d)

Voting and Dividend Rights. The holders of Restricted Shares awarded under the Plan shall have the same voting, dividend and other rights as the Corporation’s other stockholders. A Restricted Share Agreement, however, may require that the holders of Restricted Shares invest any cash dividends received in additional Restricted Shares. Such additional Restricted Shares shall be subject to the same conditions and restrictions as the Award with respect to which the dividends were paid.

(e)

Restrictions on Transfer of Shares. Restricted Shares shall be subject to such rights of repurchase, rights of first refusal or other restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Restricted Share Agreement and shall apply in addition to any general restrictions that may apply to all holders of Shares.

SECTION 7.

TERMS AND CONDITIONS OF OPTIONS.

(a)

Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the Optionee and the Corporation. Such Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions which are not inconsistent with the Plan and which the Committee deems appropriate for inclusion in a Stock Option Agreement. The Stock Option Agreement shall specify whether the Option is an ISO or an NSO. The provisions of the various Stock Option Agreements entered into under the Plan need not be identical. Options may be granted in consideration of a reduction in the Optionee’s other compensation.

(b)

Number of Shares. Each Stock Option Agreement shall specify the number of Shares that are subject to the Option (subject to adjustment in accordance with Section 13).

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(c)

Exercise Price. Each Stock Option Agreement shall specify the Exercise Price. The Exercise Price of an ISO shall not be less than 100% of the Fair Market Value of a Share on the date of grant, except as otherwise provided in Section 4(b), and the Exercise Price of an NSO shall not be less 100% of the Fair Market Value of a Share on the date of grant. Subject to the foregoing in this Section 7(c), the Exercise Price under any Option shall be determined by the Committee at its sole discretion. The Exercise Price shall be payable in one of the forms described in Section 8.

(d)

Withholding Taxes. As a condition to the exercise of an Option, the Optionee shall make such arrangements as the Corporation may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with such exercise. The Optionee shall also make such arrangements as the Corporation may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with the disposition of Shares acquired by exercising an Option.

(e)

Exercisability and Term. Each Stock Option Agreement shall specify the date when all or any installment of the Option is to become exercisable, subject to Section 12(c) in the case of automatic Option grants to Outside Directors and to Section 19(c) for all other Option grants. The Stock Option Agreement shall also specify the term of the Option;provided,however, that the term of an ISO shall in no event exceed 10 years from the date of grant (five years for Employees described in Section 4(b)). A Stock Option Agreement may provide for accelerated exercisability in the event of the Optionee’s death, Total and Permanent Disability or retirement or other events and may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service. Options may be awarded in combination with SARs, and such an Award may provide that the Options will not be exercisable unless the related SARs are forfeited. Subject to the foregoing in this Section 7(e), the Committee at its sole discretion shall determine when all or any installment of an Option is to become exercisable and when an Option is to expire.

(f)

Exercise of Options. Each Stock Option Agreement shall set forth the extent to which the Optionee shall have the right to exercise the Option following termination of the Optionee’s Service with the Corporation and its Subsidiaries, and the right to exercise the Option of any executors or administrators of the Optionee’s estate or any person who has acquired such Option(s) directly from the Optionee by bequest or inheritance. Such provisions shall be determined in the sole discretion of the Committee, need not be uniform among all Options issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination of Service.

(g)

Effect of Change in Control. The Committee may determine, at the time of granting an Option or thereafter, that such Option shall become exercisable as to all or part of the Shares subject to such Option upon a Change in Control.

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(h)

No Rights as a Stockholder. An Optionee, or a permitted transferee of an Optionee, shall have no rights as a stockholder of the Corporation with respect to any Shares covered by the Option until the date of the issuance of the Shares underlying the Option upon a valid exercise thereof.

(i)

Modification, Extension and Assumption of Options. Within the limitations of the Plan, the Committee may modify, extend or assume outstanding Options or may accept the cancellation of outstanding Options (whether granted by the Corporation or another issuer) in return for the grant of new Options for the same or a different number of Shares and at the same or a different Exercise Price; provided, however, that the Committee may not modify outstanding Options to lower the Exercise Price nor may the Committee assume or accept the cancellation of outstanding Options in return for the grant of new Options or SARs with a lower Exercise Price, unless such action has been approved by the Corporation’s stockholders. The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, materially impair such Optionee’s rights or increase his or her obligations under such Option.

(j)

Restrictions on Transfer of Shares. Any Shares issued upon exercise of an Option shall be subject to such special forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Committee may determine. Such restrictions shall be set forth in the applicable Stock Option Agreement and shall apply in addition to any general restrictions that may apply to all holders of Shares.

(k)

Buyout Provisions. Except with respect to an Option whose Exercise Price exceeds the Fair Market Value of the Shares subject to the Option, the Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents an Option previously granted or (b) authorize an Optionee to elect to cash out an Option previously granted, in either case at such time and based upon such terms and conditions as the Committee shall establish.

SECTION 8.

PAYMENT FOR SHARES.

(a)

General Rule. The entire Exercise Price or Purchase Price of Shares issued under the Plan shall be payable in lawful money of the United States of America at the time when such Shares are purchased, except as provided in Section 8(b) through Section 8(g) below.

(b)

Surrender of Stock. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by surrendering, or attesting to the ownership of, Shares which have already been owned by the Optionee or his representative. Such Shares shall be valued at their Fair Market Value on the date when the new Shares are purchased under the Plan. The Optionee shall not surrender, or attest to the ownership of, Shares in payment of the Exercise Price if such action would cause the Corporation to recognize compensation expense (or additional compensation expense) with respect to the Option for financial reporting purposes.

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(c)

Services Rendered. At the discretion of the Committee, Shares may be awarded under the Plan in consideration of services rendered to the Corporation or a Subsidiary prior to the award. If Shares are awarded without the payment of a Purchase Price in cash, the Committee shall make a determination (at the time of the award) of the value of the services rendered by the Offeree and the sufficiency of the consideration to meet the requirements of Section 6(b).

(d)

Cashless Exercise. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by delivery (on a form prescribed by the Committee) of an irrevocable direction to a securities broker to sell Shares and to deliver all or part of the sale proceeds to the Corporation in payment of the aggregate Exercise Price.

(e)

Exercise/Pledge. To the extent that a Stock Option Agreement so provides, payment may be made all or in part by delivery (on a form prescribed by the Committee) of an irrevocable direction to a securities broker or lender to pledge Shares, as security for a loan, and to deliver all or part of the loan proceeds to the Corporation in payment of the aggregate Exercise Price.

(f)

Promissory Note. To the extent that a Stock Option Agreement or Restricted Share Agreement so provides, payment may be made all or in part by delivering (on a form prescribed by the Corporation) a full-recourse promissory note.

(g)

Other Forms of Payment. To the extent that a Stock Option Agreement or Restricted Share Agreement so provides, payment may be made in any other form that is consistent with applicable laws, regulations and rules.

(h)

Limitations under Applicable Law. Notwithstanding anything herein or in a Stock Option Agreement or Restricted Share Agreement to the contrary, payment may not be made in any form that is unlawful, as determined by the Committee in its sole discretion.

SECTION 9.

STOCK APPRECIATION RIGHTS.

(a)

SAR Agreement. Each grant of a SAR under the Plan shall be evidenced by a SAR Agreement between the Optionee and the Corporation. Such SAR shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various SAR Agreements entered into under the Plan need not be identical. SARs may be granted in consideration of a reduction in the Optionee’s other compensation.

(b)

Number of Shares. Each SAR Agreement shall specify the number of Shares to which the SAR pertains and shall provide for the adjustment of such number in accordance with Section 13.

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(c)

Exercise Price. Each SAR Agreement shall specify the Exercise Price, which shall not be less than 100% of the Fair Market Value of a Share on the date of grant. A SAR Agreement may specify an Exercise Price that varies in accordance with a predetermined formula while the SAR is outstanding.

(d)

Exercisability and Term. Each SAR Agreement shall specify the date when all or any installment of the SAR is to become exercisable, subject to Section 19(c). The SAR Agreement shall also specify the term of the SAR. A SAR Agreement may provide for accelerated exercisability in the event of the Optionee’s death, Total and Permanent Disability or retirement or other events. Except as may be set forth in a SAR Agreement, vesting of the SAR shall cease on the termination of the Participant’s Service. SARs may be awarded in combination with Options, and such an Award may provide that the SARs will not be exercisable unless the related Options are forfeited. A SAR may be included in an ISO only at the time of grant but may be included in an NSO at the time of grant or thereafter. A SAR granted under the Plan may provide that it will be exercisable only in the event of a Change in Control.

(e)

Effect of Change in Control. The Committee may determine, at the time of granting a SAR or thereafter, that such SAR shall become fully exercisable as to all Shares subject to such SAR upon a Change in Control.

(f)

Exercise of SARs. Upon exercise of a SAR, the Optionee (or any person having the right to exercise the SAR after his or her death) shall receive from the Corporation (a) Shares, (b) cash or (c) a combination of Shares and cash, as the Committee shall determine. The amount of cash and/or the Fair Market Value of Shares received upon exercise of SARs shall, in the aggregate, be equal to the amount by which the Fair Market Value (on the date of surrender) of the Shares subject to the SARs exceeds the Exercise Price.

(g)

Modification or Assumption of SARs. Within the limitations of the Plan, the Committee may modify, extend or assume outstanding SARs or may accept the cancellation of outstanding SARs (whether granted by the Corporation or by another issuer) in return for the grant of new SARs for the same or a different number of Shares and at the same or a different exercise price; provided, however, that the Committee may not modify outstanding SARs to lower the Exercise Price nor may the Committee assume or accept the cancellation of outstanding SARs in return for the grant of new SARs or Options with a lower Exercise Price, unless such action has been approved by the Corporation’s stockholders. The foregoing notwithstanding, no modification of a SAR shall, without the consent of the holder, materially impair his or her rights or obligations under such SAR.

(h)

Buyout Provisions. Except with respect to a SAR whose Exercise Price exceeds the Fair Market Value of the Shares subject to the SAR, the Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents a SAR

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previously granted, or (b) authorize an Optionee to elect to cash out a SAR previously granted, in either case at such time and based upon such terms and conditions as the Committee shall establish.

SECTION 10.

RESTRICTED STOCK UNITS.

(a)

Restricted Stock Unit Agreement. Each grant of Restricted Stock Units under the Plan shall be evidenced by a Restricted Stock Unit Agreement between the recipient and the Corporation. Such Restricted Stock Units shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Restricted Stock Unit Agreements entered into under the Plan need not be identical. Restricted Stock Units may be granted in consideration of a reduction in the recipient’s other compensation.

(b)

Payment for Awards. To the extent that an Award is granted in the form of Restricted Stock Units, no cash consideration shall be required of the Award recipients.

(c)

Vesting Conditions. Each Award of Restricted Stock Units shall vest over a minimum period of three years of the Participant’s Service, subject to Section 19(c). Vesting shall occur, in full or in installments, upon satisfaction of such Service requirement and such other conditions specified in the Restricted Stock Unit Agreement. A Restricted Stock Unit Agreement may provide for accelerated vesting in the event of the Participant’s death, Total and Permanent Disability or retirement or other events. The Committee may determine, at the time of granting Restricted Stock Units or thereafter, that all or part of such Restricted Stock Units shall become vested in the event that a Change in Control occurs with respect to the Corporation. Except as may be set forth in a Restricted Stock Unit Agreement, vesting of the Restricted Stock Units shall cease on the termination of the Participant’s Service.

(d)

Voting and Dividend Rights. The holders of Restricted Stock Units shall have no voting rights. Prior to settlement or forfeiture, any Restricted Stock Unit awarded under the Plan may, at the Committee’s discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Share while the Restricted Stock Unit is outstanding. Dividend equivalents may be converted into additional Restricted Stock Units. Settlement of dividend equivalents may be made in the form of cash, in the form of Shares, or in a combination of both. Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions (including without limitation, any forfeiture conditions) as the Restricted Stock Units to which they attach.

(e)

Form and Time of Settlement of Restricted Stock Units. Settlement of vested Restricted Stock Units may be made in the form of (a) cash, (b) Shares or (c) any

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combination of both, as determined by the Committee. The actual number of Restricted Stock Units eligible for settlement may be larger or smaller than the number included in the original Award, based on predetermined performance factors. Methods of converting Restricted Stock Units into cash may include (without limitation) a method based on the average Fair Market Value of Shares over a series of trading days. A Restricted Stock Unit Agreement may provide that vested Restricted Stock Units may be settled in a lump sum or in installments. A Restricted Stock Unit Agreement may provide that the distribution may occur or commence when all vesting conditions applicable to the Restricted Stock Units have been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until an Award of Restricted Stock Units is settled, the number of such Restricted Stock Units shall be subject to adjustment pursuant to Section 13.

(f)

Death of Recipient. Any Restricted Stock Units that become payable after the recipient’s death shall be distributed to the recipient’s beneficiary or beneficiaries. Each recipient of Restricted Stock Units under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the Corporation. A beneficiary designation may be changed by filing the prescribed form with the Corporation at any time before the Award recipient’s death. If no beneficiary was designated or if no designated beneficiary survives the Award recipient, then any Restricted Stock Units that become payable after the recipient’s death shall be distributed to the recipient’s estate.

(g)

Creditors’ Rights. A holder of Restricted Stock Units shall have no rights other than those of a general creditor of the Corporation. Restricted Stock Units represent an unfunded and unsecured obligation of the Corporation, subject to the terms and conditions of the applicable Restricted Stock Unit Agreement.

SECTION 11.

PERFORMANCE SHARES.

(a)

Performance Shares and Performance Share Agreement. Each grant of Performance Shares under the Plan shall be evidenced by a Performance Share Agreement between the recipient and the Corporation. Such Performance Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Performance Share Agreements entered into under the Plan need not be identical. Performance Shares may be granted in consideration of a reduction in the recipient’s other compensation.

(b)

Payment for Awards. To the extent that an Award is granted in the form of Performance Shares, no cash consideration shall be required of the Award recipients.

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(c)

Terms of Performance Share Awards. The Committee shall determine the terms of Performance Share Awards, which may include subjecting such Awards to the attainment of “Qualifying Performance Criteria” as described in Section 19(b) of the Plan. Each Performance Share Agreement shall set forth the number of Shares subject to such Performance Share Award, the Qualifying Performance Criteria and the performance period. Subject to Section 19(c), the Participant shall be required to perform Service for the entire performance period (or if less, one year) in order to be eligible to receive payment under the Performance Share Award. Except as otherwise provided in the Performance Share Agreement, the Performance Share Award shall terminate upon the termination of the Participant’s Service. Prior to settlement, the Committee shall determine the extent to which Performance Shares have been earned. Performance periods may overlap and the holders may participate simultaneously with respect to Performance Shares Awards that are subject to different performance periods and different Qualifying Performance Criteria. The number of Shares may be fixed or may vary in accordance with such Qualifying Performance Criteria as may be determined by the Committee. A Performance Share Agreement may provide for accelerated vesting in the event of the Participant’s death, Total and Permanent Disability or retirement or other events. The Committee may determine, at the time of granting Performance Share Awards or thereafter, that all or part of the Performance Shares shall become vested upon a Change in Control.

(d)

Voting and Dividend Rights. The holders of Performance Shares shall have no voting rights with respect to such Performance Shares. Prior to settlement or forfeiture, any Performance Share awarded under the Plan may, at the Committee’s discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Share while the Performance Share is outstanding. Dividend equivalents may be converted into additional Performance Shares. Settlement of dividend equivalents may be made in the form of cash, in the form of Shares, or in a combination of both. Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions (including without limitation, any forfeiture conditions) as the Performance Shares to which they attach.

(e)

Form and Time of Settlement of Performance Shares. Settlement of Performance Shares may be made in the form of (a) cash, (b) Shares or (c) any combination of both, as determined by the Committee and set forth in the Performance Share Agreements. The actual number of Performance Shares eligible for settlement may be larger or smaller than the number included in the original Award, based on the Qualifying Performance Criteria. Methods of converting Performance Shares into cash may include (without limitation) a method based on the average Fair Market Value of Shares over a series of trading days. A Performance Share Agreement may provide that Performance Shares may be settled in a lump sum or in installments. A Performance Share Agreement may provide that the distribution may occur or commence when all vesting conditions applicable to the

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Performance Shares have been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until an Award of Performance Shares is settled, the number of such Performance Shares shall be subject to adjustment pursuant to Section 13.

(f)

Death of Recipient. Any Performance Share Award that becomes payable after the recipient’s death shall be distributed to the recipient’s beneficiary or beneficiaries. Each recipient of a Performance Share Award under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the Corporation. A beneficiary designation may be changed by filing the prescribed form with the Corporation at any time before the Award recipient’s death. If no beneficiary was designated or if no designated beneficiary survives the Award recipient, then any Performance Share Award that becomes payable after the recipient’s death shall be distributed to the recipient’s estate.

(g)

Creditors’ Rights. A holder of Performance Shares shall have no rights other than those of a general creditor of the Corporation. Performance Shares represent an unfunded and unsecured obligation of the Corporation, subject to the terms and conditions of the applicable Performance Share Agreement.

SECTION 12.

AUTOMATIC GRANTS TO OUTSIDE DIRECTORS

(a)

Annual Grants. On the first business day following the conclusion of each regular annual meeting of the Corporation’s stockholders beginning with the 2019 annual meeting, each Outside Director who will continue serving as a member of the Board of Directors thereafter shall receive Awards having an aggregate grant date fair value of $500,000, of which 75% shall be Nonstatutory Options and 25% shall be Restricted Stock Units. The number of Shares subject to such Nonstatutory Options shall be determined by dividing 75% of $500,000 (or $375,000) by the Black-Scholes value of one such Option, based on the average closing sale price for the Stock on The Nasdaq Global Select Market (or such other United States stock exchange orover-the-counter market on which the Stock is then traded) over the 30 consecutive trading days concluding with the last trading day prior to the grant date, rounded down to the nearest whole Share. The number of Shares subject to such Restricted Stock Units shall be determined by dividing 25% of $500,000 (or $125,000) by such 30 trading day average price, rounded down to the nearest whole Share. Each Outside Director who is not initially elected at a regular annual meeting of the Corporation’s stockholders in 2019 or a subsequent year shall receive Awards within 10 business days of his or her election having an aggregate grant date fair value of a pro rata portion of $500,000, such pro rata portion to be determined based on the number of full calendar months remaining from the date of election until the next regular annual meeting of the Corporation’s stockholders divided by 12. Such Outside Director’s Awards shall consist of 75% Nonstatutory Options and 25% Restricted Stock Units determined in a manner similar to that used for the annual Awards to

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Outside Directors following the conclusion of the regular annual meeting of the Corporation’s stockholders, except that the values of the Awards to such Outside Director shall be determined as of the grant date of such Awards.

(b)

Vesting Conditions. Except as set forth in the next succeeding sentence and in the last sentence of this Subsection (b), each Award granted under Subsection (a) of this Section 12 shall become vested and (in the case of Options) exercisable in full on the first anniversary of the date of grant; provided, however, that each such Award shall become vested and exercisable in full immediately prior to the next regular annual meeting of the Corporation’s stockholders following such date of grant in the event such meeting occurs prior to such first anniversary date. Except as set forth in the last sentence of this Subsection (b), each Award granted under Subsection (a) to Outside Directors who were not initially elected at a regular annual meeting of the Corporation’s stockholders shall become vested and exercisable in full immediately prior to the next regular annual meeting of the Corporation’s stockholders following the date of grant. Notwithstanding the foregoing, each Award granted under Subsection (a) above that is outstanding shall become vested and exercisable in full in the event that a Change in Control occurs with respect to the Corporation.

(c)

Award Agreement. All grants to Outside Directors under this Section 12 shall be evidenced by a Stock Option Agreement or Restricted Stock Unit Agreement, as applicable, between the Outside Director and the Corporation. Such Awards shall be subject to all applicable terms and conditions of the Plan and may be subject to other terms and conditions that are not inconsistent with the Plan and that the Board of Directors deems appropriate for inclusion in a Stock Option Agreement or Restricted Stock Unit Agreement, as applicable.

(d)

Additional Grants. Notwithstanding the foregoing provisions of this Section 12, the Board of Directors may from time to time increase the amount of the annual grant of Awards under Section 12(a) to any Outside Director to the extent the Board of Directors determines necessary to induce an Outside Director to become or remain an Outside Director or to reflect an increase in the duties or responsibilities of the Outside Director, subject to all terms and conditions of the Plan otherwise applicable to grants of Awards. Each such Award may become vested and exercisable on the same schedule as set forth in Section 12(b) or on a different schedule, as the Board of Directors in each case shall determine.

SECTION 13.

ADJUSTMENT OF SHARES; REORGANIZATIONS.

(a)

Adjustments. In the event of a subdivision of the outstanding Stock, a declaration of a dividend payable in Shares, a declaration of a dividend payable in a form other than Shares in an amount that has a material effect on the Fair Market Value of Shares, a combination or consolidation of the outstanding Stock (by reclassification or otherwise) into a lesser number of Shares, a recapitalization, a

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spin-off or a similar occurrence, the Committee shall make appropriate and equitable adjustments in:

(i)

The numerical limitations set forth in Sections 5(a) and (b);

(ii)

The number of Shares covered by all outstanding Awards; and

(iii)

The Exercise Price under each outstanding Option and SAR.

(b)

Dissolution or Liquidation. To the extent not previously exercised or settled, all outstanding Awards shall terminate immediately prior to the dissolution or liquidation of the Corporation.

(c)

Reorganizations. In the event the Corporation is party to a merger or other reorganization, subject to any vesting acceleration provisions in an Award agreement, outstanding Awards shall be treated in the manner provided in the agreement of merger or reorganization (including as the same may be amended). Such agreement shall not be required to treat all Awards or individual types of Awards similarly in the merger or reorganization;provided,however, that such agreement shall provide for one of the following with respect to all outstanding Awards (as applicable):

(i)

The continuation of the outstanding Award by the Corporation, if the Corporation is a surviving corporation;

(ii)

The assumption of the outstanding Award by the surviving corporation or its parent or subsidiary;

(iii)

The substitution by the surviving corporation or its parent or subsidiary of its own award for the outstanding Award;

(iv)

Full exercisability or vesting and accelerated expiration of the outstanding Award, followed by the cancellation of such Award;

(v)

The cancellation of an outstanding Option or SAR and a payment to the Optionee equal to the excess of (i) the Fair Market Value of the Shares subject to such Option or SAR (whether or not such Option or SARs is then exercisable or such Shares are then vested) as of the closing date of such merger or reorganization over (ii) its aggregate Exercise Price. Such payment may be made in the form of cash, cash equivalents, or securities of the surviving corporation or its parent with a Fair Market Value equal to the required amount. Such payment may be made in installments and may be deferred until the date or dates when such Option or SAR would have become exercisable or such Shares would have vested. Such payment may be subject to vesting based on the Optionee’s continuing Service, provided that the vesting schedule shall not be less favorable to the Optionee than the schedule under which such Option or SAR would

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have become exercisable or such Shares would have vested (including any vesting acceleration provisions). If the Exercise Price of the Shares subject to any Option or SAR exceeds the Fair Market Value of the Shares subject thereto, then such Option or SAR may be cancelled without making a payment to the Optionee with respect thereto. For purposes of this Subsection (v), the Fair Market Value of any security shall be determined without regard to any vesting conditions that may apply to such security;

(vi)

The cancellation of an outstanding Restricted Stock Unit and a payment to the Participant equal to the Fair Market Value of the Shares subject to such Restricted Stock Unit (whether or not such Restricted Stock Unit is then vested) as of the closing date of such merger or other reorganization. Such payment may be made in the form of cash, cash equivalents, or securities of the surviving corporation or its parent with a Fair Market Value equal to the required amount. Such payment may be made in installments and may be deferred until the date or dates when such Restricted Stock Unit would have vested. Such payment may be subject to vesting based on the Participant’s continuing Service, provided that the vesting schedule shall not be less favorable to the Participant than the schedule under which such Restricted Stock Unit would have vested (including any vesting acceleration provisions). For purposes of this Subsection (vi), the Fair Market Value of any security shall be determined without regard to any vesting conditions that may apply to such security; or

(vii)

The cancellation of an outstanding Performance Share Award and a payment to the Participant equal to the Fair Market Value of the target Shares subject to such Performance Share Award (whether or not such Performance Share Award is then vested) as of the closing date of such merger or reorganization. Such payment may be made in the form of cash, cash equivalents, or securities of the surviving corporation or its parent with a Fair Market Value equal to the required amount. Such payment may be made in installments and may be deferred until the date or dates when such Performance Share Award would have settled. Such payment may be subject to the Participant’s continuing Service and the achievement of performance criteria that are based on the performance criteria set forth in the Performance Share Award, with such changes that may necessary to give effect to the merger or other reorganization, provided that the performance period shall not be less favorable to the Participant than the performance period under such Performance Share Award (including any vesting acceleration provisions). For purposes of this Subsection (vii), the Fair Market Value of any security shall be determined without regard to any vesting conditions that may apply to such security.

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(d)

Reservation of Rights. Except as provided in Section 13, a Participant shall have no rights by reason of the occurrence of (or relating to) any merger or other reorganization, any transaction described in Section 13(a), or any transaction that results in an increase or decrease in the number of shares of stock of any class of the Corporation. Any issue by the Corporation of shares of stock of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, Awards. The grant of an Award pursuant to the Plan shall not affect in any way the right or power of the Corporation to effect any merger or other reorganization, any transaction described in Section 13(a), any dissolution or liquidation of the Corporation or any transaction that results in an increase or decrease in the number of shares of stock of any class of the Corporation.

SECTION 14.

DEFERRAL OF AWARDS.

(a)

Committee Powers. The Committee in its sole discretion may permit or require a Participant to:

(i)

Have cash that otherwise would be paid to such Participant as a result of the exercise of a SAR or the settlement of Restricted Stock Units or Performance Shares credited to a deferred compensation account established for such Participant by the Committee as an entry on the Corporation’s books;

(ii)

Have Shares that otherwise would be delivered to such Participant as a result of the exercise of an Option or SAR converted into an equal number of Restricted Stock Units; or

(iii)

Have Shares that otherwise would be delivered to such Participant as a result of the exercise of an Option or SAR or the settlement of Restricted Stock Units or Performance Shares converted into amounts credited to a deferred compensation account established for such Participant by the Committee as an entry on the Corporation’s books. Such amounts shall be determined by reference to the Fair Market Value of such Shares as of the date when they otherwise would have been delivered to such Participant.

(b)

General Rules. A deferred compensation account established under this Section 14 may be credited with interest or other forms of investment return, as determined by the Committee. A Participant for whom such an account is established shall have no rights other than those of a general creditor of the Corporation. Such an account shall represent an unfunded and unsecured obligation of the Corporation and shall be subject to the terms and conditions of the applicable agreement between such Participant and the Corporation. If the deferral or conversion of Awards is permitted or required, the Committee in its sole discretion may establish rules, procedures and forms pertaining to such Awards, including (without limitation) the settlement of deferred compensation accounts established under this Section 14.

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(c)

Code Section 409A. Notwithstanding the foregoing, any deferrals of Award payments in respect of an Award held by a Participant who is subject to United States federal income tax shall be subject to the applicable requirements of Section 409A of the Code and the Treasury Regulations promulgated thereunder. To the extent that the Committee determines that any Award granted under the Plan is subject to Section 409A of the Code, the Award agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code. In the event that following the grant of an Award the Committee determines that such Award may be subject to Section 409A of the Code, the Committee may adopt such amendments to the applicable Award agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Committee determines are necessary or appropriate to (a) exempt the Award from Section 409A of the Code and/or preserve the intended tax treatment of the benefits provided with respect to the Award, or (b) comply with the requirements of Section 409A of the Code and the Treasury Regulations promulgated thereunder and thereby avoid the application of any penalty taxes under such Section.

SECTION 15.

PAYMENT OF DIRECTOR’S FEES IN SECURITIES

(a)

Effective Date. No provision of this Section 15 shall be effective unless and until the Board has determined to implement such provision.

(b)

Elections to Receive NSOs, Restricted Shares or Restricted Stock Units. An Outside Director may elect to receive his or her annual retainer payment and/or meeting fees from the Corporation in the form of cash, NSOs, Restricted Shares or Restricted Stock Units, or a combination thereof, as determined by the Board. Such NSOs, Restricted Shares or Restricted Stock Units shall be issued under the Plan. An election under this Section 15 shall be filed with the Corporation on the prescribed form. For the avoidance of doubt, any Awards issued to an Outside Director pursuant to this Section 15 shall not be counted towards the limit on annual Awards to the Outside Director prescribed by Section 12(a).

(c)

Number and Terms of NSOs, Restricted Shares or Restricted Stock Units. The number of NSOs, Restricted Shares or Restricted Stock Units to be granted to Outside Directors in lieu of annual retainers and meeting fees that would otherwise be paid in cash shall be calculated in a manner determined by the Board. The term of such NSOs, Restricted Shares or Restricted Stock Units shall also be determined by the Board.

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SECTION 16.

AWARDS UNDER OTHER PLANS.

The Corporation may grant awards under other plans or programs. Such awards may be settled in the form of Shares issued under this Plan. Such Shares shall be treated for all purposes under the Plan like Shares issued in settlement of Restricted Stock Units and shall, when issued, reduce the number of Shares available under Section 5.

SECTION 17.

LEGAL AND REGULATORY REQUIREMENTS.

Shares shall not be issued under the Plan unless the issuance and delivery of such Shares complies with (or is exempt from) all applicable requirements of law, including (without limitation) the Securities Act of 1933, as amended, the rules and regulations promulgated thereunder, state securities laws and regulations and the regulations of any stock exchange on which the Corporation’s securities may then be listed, and the Corporation has obtained the approval or favorable ruling from any governmental agency which the Corporation determines is necessary or advisable. The Corporation shall not be liable to a Participant or other persons as to: (a) thenon-issuance or sale of Shares as to which the Corporation has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Corporation’s counsel to be necessary to the lawful issuance and sale of any Shares under the Plan; and (b) any tax consequences expected, but not realized, by any Participant or other person due to the receipt, exercise or settlement of any Award granted under the Plan.

SECTION 18.

WITHHOLDING TAXES.

(a)

General. To the extent required by applicable federal, state, local or foreign law, a Participant or his or her successor shall make arrangements satisfactory to the Corporation for the satisfaction of any withholding tax obligations that arise in connection with the Plan. The Corporation shall not be required to issue any Shares or make any cash payment under the Plan until such obligations are satisfied.

(b)

Share Withholding. The Corporation may permit a Participant to satisfy all or part of his or her withholding or income tax obligations by having the Corporation withhold all or a portion of any Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Shares that he or she previously acquired. Such Shares shall be valued at their Fair Market Value on the date when taxes otherwise would be withheld in cash. In no event may a Participant have Shares withheld that would otherwise be issued to him or her in excess of the number necessary to satisfy the legally required minimum tax withholding.

SECTION 19.

OTHER PROVISIONS APPLICABLE TO AWARDS.

(a)

Transferability. Unless the agreement evidencing an Award (or an amendment thereto authorized by the Committee) expressly provides otherwise, no Award granted under this Plan, nor any interest in such Award, may be assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred in any manner (prior to the vesting and lapse of any and all restrictions applicable to Shares issued under such Award), other than by will, by designation of a beneficiary

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(which shall be a family member or family trust) delivered to the Company, or by the laws of descent and distribution;provided,however, that an ISO may be transferred or assigned only to the extent consistent with Section 422 of the Code. Notwithstanding the foregoing, in no event may a Participant sell or otherwise transfer for value any Award granted under the Plan or any interest in such an Award, other than Shares issued to the Participant that are no longer subject to vesting or other restrictions under the terms of the applicable Award. Any purported sale, assignment, conveyance, gift, pledge, hypothecation or transfer in violation of this Section 19(a) shall be void and unenforceable against the Corporation.

(b)

Qualifying Performance Criteria. The number of Shares or other benefits granted, issued, retainable and/or vested under an Award may be made subject to the attainment of performance goals for a specified period of time relating to one or more of the following performance criteria, either individually, alternatively or in any combination, applied to either the Corporation as a whole or to a business unit or Subsidiary, either individually, alternatively or in any combination, and measured either annually or cumulatively over a period of years, on an absolute basis or relative to apre-established target, to previous years’ or quarter’s results or to the performance of one or more comparable companies or a designated comparison group or index, in each case as specified by the Committee in the Award: (a) cash flow (including operating cash flow), (b) earnings per share, (c) (i) earnings before interest, (ii) earnings before interest and taxes, (iii) earnings before interest, taxes and depreciation, (iv) earnings before interest, taxes, depreciation and amortization, or (iv) earnings before any combination of such expenses or deductions, (d) return on equity, (e) total stockholder return, (f) share price performance, (g) return on capital, (h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating income or net operating income, (l) operating profit or net operating profit, (m) operating margin or profit margin (including as a percentage of revenue), (n) return on operating revenue, (o) return on invested capital, (p) market segment shares, (q) economic profit, (r) achievement of target levels of discovery and/or development of products, including but not limited to regulatory achievements, (s) achievement of research and development objectives, or (t) formation of joint ventures, strategic relationships or other commercial, research or development collaborations (“Qualifying Performance Criteria”). The Committee may appropriately adjust any evaluation of performance under a Qualifying Performance Criteria to exclude any of the following events that occur during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) any extraordinary, nonrecurring items to be disclosed in the Corporation’s financial statements (including footnotes) for the applicable year and/or in management’s discussion and analysis of the financial condition and results of operations appearing in the Corporation’s annual report to stockholders for the applicable year. If applicable, the Committee shall determine the

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Qualifying Performance Criteria and any permitted exclusions pursuant to the preceding sentence not later than the 90th day of the performance period, and shall determine and certify, for each Participant (or for all Participants), the extent to which the Qualifying Performance Criteria have been met. The Committee may not in any event increase the amount of compensation payable under the Plan upon the attainment of a Qualifying Performance Criteria to a Participant who is a “covered employee” within the meaning of Section 162(m) of the Code.

(c)

Vesting Restrictions on Awards. Except with respect to a maximum of five percent (5%) of the total number of Shares authorized under the Plan or, in the case of automatic grants to Outside Directors, as otherwise permitted under Section 12(b), no Award may vest sooner than twelve (12) months from the date of grant.

SECTION 20.

NO EMPLOYMENT RIGHTS.

No provision of the Plan, nor any Award granted under the Plan, shall be construed to give any person any right to become, to be treated as, or to remain an Employee. The Corporation and its Subsidiaries reserve the right to terminate any person’s Service at anyCanadaSave paper, time and money! Sign up for any reason, with or without notice.

SECTION 21.

APPLICABLE LAW.

The Plan shall be construed and enforced in accordance with the lawelectronic delivery at www.envisionreports.com/INCY 1. Election of the State of Delaware, without reference to its principles of conflicts of law.

SECTION 22.

DURATION AND AMENDMENTS.

(a)

Term of the Plan. The Plan, as set forth herein, shall terminate automatically on June 30, 2021 and may be terminated on any earlier date pursuant to Subsection (b) below.

(b)

Right to Amend or Terminate the Plan. The Board of Directors may amend or terminate the Plan at any time and from time to time. Rights and obligations under any Award granted before amendment of the Plan shall not be materially impaired by such amendment, except with consent of the Participant. An amendment of the Plan shall be subject to the approval of the Corporation’s stockholders only to the extent required by applicable laws, regulations or rules.

(c)

Effect of Termination. No Awards shall be granted under the Plan after the termination thereof. The termination of the Plan shall not affect Awards previously granted under the Plan.

INCYTE CORPORATION

AMENDEDAND RESTATED 2010 STOCK INCENTIVE PLAN

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            LOGOLOGO
Your vote matters - here’s how to vote!
You may vote online or by phone instead of mailing this card.
LOGOVotes submitted electronically must be received by 11:59pm, (EDT), on April 25, 2019
Online

Go towww.envisionreports.com/INCY

or scan the QR code – login details are located in the shaded bar below.

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Phone

Call toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada

Using ablack ink pen, mark your votes with an X as shown in this example.

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LOGODirectors:q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.LOGO

 A Proposals – The Board of Directors recommend a voteFOR all the nominees listed andFOR Proposals 2-4 andAGAINST Proposal 5.

1. Election qFor Against Abstain For Against Abstain For Against Abstain 01 - Julian C. Baker 04 - Paul J. Clancy07 - Katherine A. High02 - Jean-Jacques Bienaimé 05 - Jacqualyn A. Fouse08 - Hervé Hoppenot03 - Otis W. Brawley06 - Edmund P. Harrigan2. Approve, on a non-binding, advisory basis, the compensation of Directors:

+
ForAgainstAbstainForAgainstAbstainForAgainstAbstain
  01 - Julian C. Baker☐☐☐02 - Jean-Jacques Bienaimé☐☐☐03 - Paul A. Brooke☐☐☐
  04 - Paul J. Clancy☐☐☐05 - Wendy L. Dixon☐☐☐06 - Jacqualyn A. Fouse☐☐☐
  07 - Paul A. Friedman☐☐☐08 - Hervé Hoppenot☐☐☐

ForAgainstAbstainForAgainstAbstain

2. To approve, on a non-binding, advisory basis, the compensation of the Company’s named executive officers

☐☐☐

3. To approve amendments to the Company’s Amended and Restated 2010 Stock Incentive Plan

☐☐☐

4. To ratify the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for 2019.

☐☐☐

5. To vote on a stockholder proposal, if properly presented, described in more detail in the proxy statement.

☐☐☐

6. In their discretion. upon such other business as may properly come before the meeting or any adjournment thereof.

 B Authorized Signatures – This section must be completed for your vote to count. Please date and sign below.

the Company's named executive officers.For Against Abstain For Against Abstain3. Ratify the appointment of Ernst & Young LLP as the Company’sindependent registered public accounting firm for 2022. Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please givegiv full title.

Date (mm/dd/yyyy) – Please print date below.Signature 1 – Please keep signature within the box.Signature 2 – Please keep signature within the box.

                /                /

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title.Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. 03M53B8 2 B M

TABLE OF CONTENTS
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Important notice regarding the Internet availability of proxy materials for the Annual Meeting of Stockholders.

TheStockholders.The Proxy Statement and the Annual Report on Form 10-K for the year ended December 31, 20182021 are available at http://www.envisionreports.com/incy

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LOGO q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.LOGO

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PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

ForDIRECTORSFor Annual Meeting – April 26, 2019

HERVÉ— June 15, 2022HERVÉ HOPPENOT CHRISTIANA STAMOULIS and MARIA E. PASQUALE, or anyeither of them, each with the power of substitution, are hereby authorized to represent as proxies and vote with respect to the proposals set forth below and in the discretion of such proxies on all other matters that may be properly presented for action all shares of stock of Incyte Corporation (the “Company”) the undersigned is entitled to vote at the Annual Meeting of Stockholders of the Company to be held at the Company’s offices at 1815 Augustine Cut-Off,Cut-off, Wilmington, Delaware 19803, on Friday, April 26, 2019Wednesday, June 15, 2022 at 1:00 p.m., Eastern Daylight Time, or at any postponement or adjournment thereof, and instructs said proxies to vote as follows:

Shares represented by this proxy will be voted as directed by the stockholder. If no such directions are indicated, the proxies will have authority to vote FOR each director nominee and FOR items 2 3 and 4, and AGAINST item 53 and in accordance with the discretion of the proxies on any other matters as may properly come before the Annual Meeting.

(continued and to be signed on reverse side)

 C Non-Voting Items

Change of Address – Please print new address below.Comments – Please print your comments below.

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Change of Address — Please print new address below. Comments — Please print your comments below.