8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) September 16, 2011

PHARMACEUTICAL PRODUCT DEVELOPMENT, INC.

(Exact name of registrant as specified in its charter)

North Carolina

(State or other jurisdiction of incorporation)

0-27570	56-1640186
(Commission File Number)	(IRS Employer ID Number)

929 North Front Street, Wilmington, North Carolina 28401

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code (910) 251-0081

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement with Certain Officers.

(c) On September 19, 2011, Pharmaceutical Product Development, Inc. (the “Company”) announced that it has named Raymond H. Hill as its Chief Executive Officer, effective September 16, 2011. Mr. Hill’s employment will be governed by an employment and other related agreements between him and the Company. The employment agreement will have an initial term of two years until September 15, 2013. The employment agreement will automatically renew unless either party gives the other written notice of termination at least 90 days prior to the end of the then current term of the employment agreement. The Board of Directors of the Company also appointed Mr. Hill as a director of the Company.

Prior to his employment by the Company, Mr. Hill spent eight years with IMS Health, Inc., a provider of data, market research and consulting services to clients in the pharmaceutical and health care industries. He most recently served as President of IMS Consulting Group. Prior to his tenure at IMS Health, Mr. Hill was senior vice president for Acumen Sciences Limited. Mr. Hill held several roles in eight years at A.T. Kearney Ltd., including global head, pharmaceuticals and health care practice. In a six-year stint that culminated with him serving as senior associate in the energy, chemicals and pharmaceuticals practice of Booz Allen & Hamilton, Inc., Mr. Hill gravitated to the health care side of the practice, which set him on his career path in the life sciences arena. Mr. Hill holds a bachelor’s degree from Cornell University and a master’s degree from Duke University.

Mr. Hill’s annual base salary will initially be $575,000. He will be granted 30,000 shares of restricted stock and nonqualified stock options to purchase 150,000 shares of Company common stock. Consistent with the Company’s standard practice, the restricted stock and option awards will vest one-third per year on the first, second and third anniversaries of the date of grant.

If the Company terminates Mr. Hills’s employment without cause, subject to receiving a signed separation agreement and general release of claims from Mr. Hill, the Company shall pay Mr. Hill’s base salary through the end of the then current employment period and shall provide benefits as are required by applicable law, unless Mr. Hill’s termination results in compensation and benefits being provided pursuant to the severance agreement. In the event the Company terminates Mr. Hill’s employment with cause, he will be paid his base salary through the date of termination and be provided such benefits as required by law. In the event of Mr. Hill’s death or disability, then the Company shall have no further obligations, except to pay Mr. Hill his base salary accrued through the date of termination and provide such benefits as are required by applicable law. Upon Mr. Hill’s death or disability, the Company will also pay him his pro rata share of any incentive compensation earned during the year in which the termination occurs, such incentive compensation to be determined and payable in the same manner and at the same time as it would have been had Mr. Hill’s employment not been terminated.

The Company also entered into a severance agreement with Mr. Hill. The severance agreement provides him, in the event of termination without cause or constructive termination, in each case following a change of control, with a lump sum payment equal to 2.99 times the sum

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of his base salary during the 12-month period leading up to his termination and the greater of his target bonus under the Company’s incentive cash bonus plan immediately prior to the termination date or the average of the cash bonuses received in the 24-month period leading up to termination. In addition to the severance payment, all outstanding unvested stock options and unvested restricted stock granted more than six months prior to the executive officer’s termination of employment will vest upon termination, except if the change of control occurs prior to September 16, 2012. The Company is also obligated to continue to pay for and provide the benefits that Mr. Hill was receiving immediately prior to termination of employment, including medical, dental and vision, for up to 2 years following termination. If triggered, the Company may discontinue providing these benefits to Mr. Hill on the date on which he becomes eligible for similar coverage under another employer’s plan. If Mr. Hill elects to port the group term life and accidental death and dismemberment insurance to an individual policy then the Company will reimburse him for premiums. However, such reimbursement obligations shall terminate if and when Mr. Hill becomes eligible after the termination date for similar coverage under another employer’s plan or 24 months from termination, whichever happens sooner. The Company will also pay all legal expenses incurred by Mr. Hill in successfully enforcing the severance agreement. The Company is not obligated to “gross up” Mr. Hill’s compensation for any excise, income or other tax due with respect to the severance benefits payable under these agreements.

The descriptions of the employment and severance agreements set forth above are not complete. A copy of Mr. Hill’s Employment Agreement and Severance Agreement, both dated September 16, 2011, will be filed with the Company’s Form 10-Q for the quarter ending September 30, 2011 and is hereby incorporated herein by reference.

Mr. Hill is 48 years old and has no familial relationships with any executive officer or director of the Company. Other than his employment by the Company, there have been no transactions in which the Company has participated and in which he had a direct or indirect material interest involving in excess of $120,000 since January 1, 2010, the beginning of the Company’s last completed fiscal year.

Item 7.01. Regulation FD Disclosure.

The Company is furnishing as Exhibit 99.1 to this Form 8-K a press release, dated September 19, 2011, announcing Mr. Hill’s employment with the Company. Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

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Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1*	Press release to announce employment of Raymond H. Hill, dated September 19, 2011.

* Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

	PHARMACEUTICAL PRODUCT DEVELOPMENT, INC.
Date: September 22, 2011	/s/ Daniel G. Darazsdi
	Daniel G. Darazsdi,
	Chief Financial Officer

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EX-99.1

Exhibit 99.1

Media:

Elizabeth Kuronen

+910 558 7785

elizabeth.kuronen@ppdi.com

Analysts/Investors:

Luke Heagle

+910 558 7585

luke.heagle@ppdi.com

FOR IMMEDIATE RELEASE

PPD Appoints Raymond Hill as Chief Executive Officer

and Member of the Board of Directors

WILMINGTON, N.C. (September 19, 2011) — PPD, Inc. (Nasdaq: PPDI) today announced that its board of directors has named Raymond H. Hill as PPD’s new chief executive officer and elected him to the board of directors, both effective September 16.

Mr. Hill comes to PPD after eight years with IMS Health, Inc., a provider of data, market research and consulting services to clients in the pharmaceutical and health care industries. He most recently served as president of IMS Consulting Group. During his tenure at IMS, he oversaw a strategy of aggressive organic and acquisition-based growth. Annual revenue increased five-fold over seven years helping to transform IMS from its data and market research roots and make it a leader in pharmaceuticals consulting. He also served on the executive leadership team of IMS, helping to set the overall direction of the company.

“With more than 20 years of experience in the life sciences arena, Ray brings keen strategic acumen as a proven leader who has grown global client services businesses in the pharmaceutical industry,” said Fred Eshelman, executive chairman of PPD. “His consistent track record of business success and disciplined approach to operational and financial performance make him well suited for our CEO role.”

Prior to his tenure at IMS Health, Mr. Hill was senior vice president for Acumen Sciences Limited. Mr. Hill held several roles in eight years at A.T. Kearney Ltd., including global head, pharmaceuticals and health care practice, in which he led the creation of the practice, hired the team of health care professionals and grew annual revenue to $45 million. In a six-year stint that culminated with him serving as senior associate in the energy, chemicals and pharmaceuticals practice of Booz Allen & Hamilton Inc., Mr. Hill gravitated to the health care side of the practice, which set him on his career path in the life sciences arena.

Consulting Magazine recognized Mr. Hill as one of the top 25 management consultants globally, and PharmaVoice recognized him as one of the 100 most inspirational leaders in the pharmaceutical industry, both in 2007.

Mr. Hill holds a bachelor’s degree from Cornell University and a master’s degree from Duke University. He is married with three children.

PPD is a leading global contract research organization providing drug discovery, development and lifecycle management services. Our clients and partners include pharmaceutical, biotechnology, medical device, academic and government organizations. With offices in 44 countries and more than 11,000 professionals worldwide, PPD applies innovative technologies, therapeutic expertise and a commitment to quality to help clients and partners accelerate the delivery of safe and effective therapeutics and maximize the returns on their R&D investments. For more information, visit www.ppdi.com.

Except for historical information, all of the statements, expectations and assumptions, including statements, expectations and assumptions about Mr. Hill’s future contributions and success as PPD’s new CEO, contained in this news release are forward-looking statements that involve a number of risks and uncertainties. Although PPD attempts to be accurate in making these forward-looking statements, it is possible that future circumstances might differ from the assumptions on which such statements are based and could cause actual results to differ materially from the forward-looking statements. Other important factors which could cause future results to differ materially include the following: the ability to attract, integrate and retain key personnel, including Mr. Hill; competition in the outsourcing industry; PPD’s ability to win new business; overall global economic conditions; economic conditions, research and development spending and outsourcing trends in the pharmaceutical, biotechnology and government-sponsored research sectors; risks associated with and dependence on strategic relationships; consolidation in the pharmaceutical and biotechnology industries; loss, delay or modification of large contracts; higher-than-expected cancellation rates; the rate of conversion of backlog into revenue; actual operating performance; rapid technological advances that make our services less competitive; compliance with drug development regulations; changes in the regulation of the drug development process; fluctuations in currency exchange rates; risks associated with fixed price contracts and cost overruns; international economic and political risks; and the ability to control SG&A spending. These and other PPD risk factors are set forth in more detail from time to time in our SEC filings, copies of which are available free of charge upon request from PPD’s investor relations department. PPD assumes no obligation and expressly disclaims any duty to update these forward-looking statements in the future, except as required by applicable law. These forward-looking statements should not be relied upon as representing PPD’s estimates or views as of any date subsequent to the date hereof.

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