Replies to post #8122 on GTC Biotherapeutics (fka GTCB)

[jessellivermore]

graduatestudent''

My point is.....we just do not know the circumstances and answers to many {most) of the issues raised on this board. You don't know them and neither do I. You might be surprised about how Cox feels about his options....you are assuming GTCB's chances for success are pretty slim,,,at least it sounds that way from your comments. We know Cox has more than 600,000 options, if the company survives the next 18 months we know it will have achieved a self sustaining revenue stream. If Atryn can be shown to improve surival in DIC, GTCB will be in control of a blockbuster drug. GTCB can look forward to revenues from FVIIa (the only stuff on the planet worth more is Kryptonite). I would put the chances of those things coming to pass way above 70% At that point the PPS would be way above 20....and Cox's options would be worth more than 12,000,000$ Roughly twenty years salary.

Things have been rough lately,,,,it's mainly a cash situation..
GTCB has been in worse straights in the past. After the EMEA debacle the future of Atryn and even GTCB's platform was teetering on the abiss. If they had not gotten a reversal who knows what might of happened and they close to being out of money then. I talked to Cox at the shareholder after the negative opinion,,,,it was a really dark time..I got the sense then of his determination that he was a good CEO for the company.

The one area the company could talk up more would be what type of effort they are putting into an agreement with Japan. Japan already believes AT3 is effective in DIC...They should be pushing this hard,

[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.