A woman’s fertility company has withheld bonuses to key executives after two botched embryo transfers, one of which resulted in a woman giving birth to a genetically unrelated baby.
Monash IVF’s long-standing chief executive Michael Knapp resigned after the second mix-up in June, when a patient’s own embryo was incorrectly transferred back to her despite her treatment plan specifying she should receive an embryo from her partner.
This came just months after the mix-up at Monash’s Brisbane clinic where a stranger’s embryo was implanted in a woman seeking treatment.
The incident was made public in April but the company became aware of it in February.
Monash’s chief operating officer Hamish Hamilton had earlier resigned in March. After more 20 years with Monash, he left to take a job at competitor Virtus Health.
In its annual report released Monday, Monash’s board of directors said they had expressed their disappointment and recognised the impact of the incidents on its shareholders.
“Our approach to remuneration continues to align outcomes with performance, with these developments key in determining the remuneration outcomes for Key Management Personnel Executives,” the board said.
As such they made the decision not to award any short-term bonuses, even before knowing the “formulaic outcomes” by which such awards are normally determined, the board said.
Mr Knaap had been eligible for a bonus of up to $434,000, while Mr Hamilton lost up to $600,000.
The board said it had adjusted its executive pay policy going forward, adding a modifier to allow the board to reduce outcomes “in cases of serious adverse events or matters resulting in a material impact to reputation, financial or safety results”.
“This will further align incentive with long-term responsible behaviour,” it said.
Monash has added security to its embryo transfer process with electronic verifications and photographing every step of the laboratory process.
A global search is under way for a new chief executive, with chief financial officer Malik Jainudeen serving as acting CEO in the meantime.
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