GTC Biotherapeutics (fka GTCB)

[mouton29]

<<Cox makes a *substantial* salary, so any options on top of it are pure gravy. I disagree with those posters who think he necessarily feels a real pinch due to a downward estimate on the imputed value of his options. I would bet that any important financial decisions he is making for his family are based on his annual salary income and not some imputed value stemming from a ream of options. In turn, a "paper loss" on the value of those options is about as painful as the financial hit he takes from buying a cup of coffee.>>

Since you are stating this as a general observation about biotech ceos -- and I don't see why you limit to biotech -- my view is that many of these people are motivated by the dream of riches. 300,000 or 600,000 a year is no doubt a substantial salary, but if you aspire to fancy homes, your own private jet, the life style of the rich and famous -- or perhaps the funds to start your own company or just retire early -- that salary will not get you there.

I will admit that the mechanism for negotiating public company salaries is often far from arm's length, but the fact is that if you see what happens in private equity, it is not much different. I don't think I've worked on a private equity deal -- many of them speculative -- where management was not given options or the equivalent of options, not because they insist on it as "gravy" but because the owners insist on it as part of the package, believing it in fact does provide an incentive.