Biotech Values

[DewDiligence]

How MNTA Executed Against Its 2011 Internal Goals

The numbers shown below were used by the BoD’s compensation committee
to determine the 2011 bonuses for MNTA’s executive officers. The goals and
weightings for each goal were specified at the start of 2011; however, a fudge
factor of 8.5% was added at the end of the year, bringing the total size of the
goal pie to 108.5% before applying the achievement percentages for each goal.
Moreover, the achievement % for a goal can exceed 100%, as it did for three
items in the list below.

Further, one can take issue with some of the achievement weightings—e.g.
the 70% figure for advancing M402, which is very late in starting phase-1
clinical trials, relative to the original guidance.

All told, it’s hard to take seriously the contrived arithmetic that led to the
bottom-line figure of 110% used by the BoD to determine 2011 bonuses.
About the only positive thing one can say about this is that MNTA deserves
some credit for disclosing the process, however silly it may be.

 
                                      Weighting    Actual Level     Weighted   
 Corporate Goal                        of Goal    of Achievement   Achievement   
  
 Enabling manufacture of Lovenox . . . . 15%          130%          19.5% 
  
 Advancement of Copaxone—regulatory. . . 10%           70%           7.0% 
  
 Advancement of Copaxone—development . . 10%           70%           7.0% 
  
 Advancement of Copaxone—litigation  . .  5%          100%           5.0% 
  
 Advancement of M402 program . . . . . . 10%           70%           7.0% 
  
 Advancement of “research” program 
 (I interpret this as general research 
 not tied to any particular program) . . 10%          100%          10.0% 
  
 Advancement of biologics program 
 (I interpret this as undisclosed FoB(s) 
 apart from the BAX collaboration) . . .  5%           70%           3.5% 
  
 Business development goals 
 (e.g. the BAX partnership). . . . . . . 15%          130%          19.5% 
  
 Advancement of corporate strategy 
 (I interpret this as alignment of 
 MNTA’s goals with FDA policy on FoB’s). 10%          130%          13.0% 
  
 Financial discipline. . . . . . . . . . 10%          100%          10.0% 
      
 Post-hoc fudge factor (see above) . . .  8.5%        100%           8.5% 
  
                                        ======                     ======   
 TOTAL                                  108.5%                     110.0% 

Source: Proxy statement for 2012 annual meeting on Form DEF14A, page 26-27 (http://www.sec.gov/Archives/edgar/data/1235010/000104746912004605/a2208989zdef14a.htm ).