PACIFIC BIOSCIENCES OF CALIFORNIA (PACB)
Sector: Health Care
2026 Annual Meeting Analysis
PACIFIC BIOSCIENCES OF CALIFORNIA · Meeting: June 3, 2026
Directors FOR
2
Directors AGAINST
4
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Six Directors
Against Analysis
Mr. Henry has served on the board since 2018, well before the underperformance period, so his tenure fully overlaps the 3-year measurement window; PACB's 3-year stock return of -85.9% trails the company-disclosed peer group median by 42.1 percentage points, which exceeds the 20-point trigger threshold for negative absolute TSR, and the 5-year gap of -17.9pp does not clear the 20pp mitigant threshold either, confirming sustained underperformance rather than a transient dip.
Dr. Milligan has served as a director since 2013 and as Chairman since 2020, so his tenure fully encompasses the 3-year underperformance period; PACB's stock has lost 85.9% over three years while the peer group median fell only 43.8%, a 42.1-point gap that far exceeds the 20-point trigger, and the 5-year relative gap of -17.9pp does not clear the mitigant threshold, indicating persistent rather than temporary underperformance.
Mr. Ericson has been a director since 2004, giving him full accountability for the 3-year underperformance period; the 42.1-point gap versus the peer group median exceeds the 20-point policy trigger for negative absolute TSR, and the 5-year relative underperformance of -17.9pp does not satisfy the mitigant threshold, so no downgrade to FOR is warranted.
Ms. Ordoñez has served since 2014 and her tenure fully overlaps the 3-year measurement window; the 42.1-point underperformance versus peer medians triggers the policy's negative-TSR threshold of 20 points, and the 5-year gap of -17.9pp does not clear the same threshold, confirming that the underperformance is not merely a recent blip.
For Analysis
Dr. Gibson joined the board in March 2026, which is within the 24-month new-director exemption window, so he is exempt from the stock performance trigger regardless of PACB's underperformance.
Mr. Smith joined the board in January 2025, which is within the 24-month new-director exemption window, so he is exempt from the stock performance trigger and no other policy concerns arise from his biography or disclosures.
Four of the six nominees — Henry, Milligan, Ericson, and Ordoñez — receive AGAINST votes because their long board tenures fully overlap a severe 3-year underperformance period in which PACB's stock fell 85.9% while the company-disclosed peer group median fell only 43.8%, a 42.1-point gap that triggers the policy's director TSR threshold; the 5-year check does not provide a mitigant. The two newer directors — Gibson (joined March 2026) and Smith (joined January 2025) — are exempt from the TSR trigger under the 24-month new-director rule and receive FOR votes.
Say on Pay
✓ FORCEO
Christian O. Henry
Total Comp
$4,309,846
Prior Support
N/A
CEO Christian O. Henry received total compensation of approximately $4.3 million for 2025; for a small-cap healthcare/genomics company of PACB's size (market cap roughly $474 million), this level is broadly in line with benchmarks for a CEO at a company in this market cap band and sector, and does not appear to exceed the 20% individual CEO threshold above benchmark. The pay mix includes a meaningful proportion in equity awards (stock options and restricted stock units), which ties a significant portion of compensation to stock price outcomes and satisfies the variable pay requirement. While PACB's stock performance has been very poor over three years, the variable pay components appear at or near benchmark rather than materially above it, so the pay-for-performance alignment check does not independently trigger a No vote.
Auditor Ratification
✓ FORAuditor
Ernst & Young LLP
Tenure
15 yrs
Audit Fees
$2,160,000
Non-Audit Fees
$0
Ernst & Young LLP has audited PACB since 2011 (approximately 15 years), which is below the 25-year tenure threshold; non-audit fees are zero, so the non-audit ratio concern does not apply; and there are no disclosed material restatements, making a FOR vote appropriate under all policy screens.
Overall Assessment
This ballot features four AGAINST votes on director elections driven by PACB's severe 3-year stock underperformance of 85.9% against a peer group median decline of only 43.8%, a 42.1-point gap that triggers the policy threshold for all directors whose tenures predate the underperformance period; the auditor ratification and say-on-pay proposals both pass policy screens and receive FOR votes, while the equity plan amendment falls outside the scope of the current policy.
Compensation Peer Group
15 companies disclosed in 2026 proxy filing