Pacira BioSciences Inc

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Pay Versus Performance

The Compensation Committee oversees our compensation programs that are designed to attract, retain, motivate, and align the interests of our named executive officers with that of stockholders. We link executive pay with shareholder interests through a blend of short- and long-term measures. In 2023, incentive pay made up 88 percent of our CEO’s target compensation and, on average,74 percent of our other named executive officers’ target compensation. The high utilization of incentive compensation results in higher total realized pay when leadership exceeds their performance targets. Conversely, failure to achieve approved targets

results in lower realized pay including the possibility that some awards pay zero at the end of their performance period.

The compensation actually paid, as calculated under SEC rules (“CAP”), for the PEO (or Principal Executive Officer (“PEO”)) and the average for non-PEO named executive officers (or “non-PEO NEOs”) and certain financial performance of the Company in each of the last four fiscal years is shown in the table below. The CAP does not reflect the actual amount of compensation earned or paid during the applicable year.

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PAY VERSUS PERFORMANCE TABLE

The following table sets forth information regarding the Company’s CAP and certain other Company financial information for fiscal years 2023, 2022, 2021 and 2020.

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(1)

Represents the weighted peer group TSR, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which a return is indicated. The peer group used is the S&P Pharmaceuticals Select Index.

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(2)

The comparison of total shareholder returns assumes that $100 was invested on December 31, 2019 in Pacira and the S&P Pharmaceuticals Select Index, and that any dividends were reinvested when and as paid.

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(3)

Represents the amount of net income reflected in the Company’s audited financial statement for the applicable year. Included in net income in 2020 was a $126.6 million income tax benefit related to the release of a valuation allowance on deferred tax assets.

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(4)

The company selected measure is adjusted EBITDA, calculated and defined as described in the section on page 62 titled “2023 Cash LTIP Targets and Earned Awards”.

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The PEO and non-PEO NEOs included in the above compensation columns are as follows:

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The following table reconciles the amounts reported in the Summary Compensation Table (“SCT”) (column (b) above) to the CAP (column (c) above) to our PEO, David Stack, in the years presented:

Stock and Option Award Valuations: Stock option grant date fair values are calculated based on the Black-Scholes option pricing model as of the date of grant. Adjustments have been made using stock option fair values as of each measurement date using the stock price as of the measurement date and updated assumptions (i.e., expected term, volatility, dividend yield, risk free rate) as of the measurement date. Time-vested RSU grant date fair values are calculated using the stock price as of the date of grant. Adjustments have been made using the stock price as of year-end and as of each date of vest, as applicable.

The following table reconciles the amounts reported in the SCT (column (d) above) to the average CAP (column (e) above) to our non-PEO NEOs (as listed above) in the years presented:

Stock and Option Award Valuations: Stock option grant date fair values are calculated based on the Black-Scholes option pricing model as of the date of grant. Adjustments have been made using stock option fair values as of each measurement date using the stock price as of the measurement date and updated assumptions (i.e., expected term, volatility, dividend yield, risk free rate) as of the measurement date. Time-vested RSU grant date fair values are calculated using the stock price as of the date of grant. Adjustments have been made using the stock price as of year-end and as of each date of vest, as applicable.

Tabular List of Financial and Non-Financial Performance Measures

Used to Link Compensation Actually Paid to Named Executive Officers

for the Year Ended December 31, 2023 to Company Performance

PAY VERSUS PERFORMANCE: TOTAL SHAREHOLDER RETURN

The chart below compares the CAP to our PEO and the average CAP to our non-PEO NEOs with the TSR of the Company and its selected peer group—the S&P Pharmaceuticals Select Index. As described on page 63, this index is the same one used in our cash LTIP plan.

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PAY VERSUS PERFORMANCE: NET INCOME

The chart below compares the CAP to our PEO and the average CAP to our non-PEO NEOs with the Company’s net income.

Included in net income in 2020 was a $126.6 million income tax benefit related to the release of a valuation allowance on deferred tax assets.

PAY VERSUS PERFORMANCE: ADJUSTED EBITDA (NON-GAAP)

The chart below compares the CAP to our PEO and the average CAP to our non-PEO NEOs with the Company’s adjusted EBITDA, which includes GAAP to non-GAAP adjustments that reflect how the Company’s management analyzes its financial results. The adjusted EBITDA figures presented here are unlikely to be comparable with adjusted EBITDA disclosures released by other companies.

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