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December 7, 2012
The Worst Biotech CEO?
Posted by Derek
Adam Feuerstein at TheStreet.com has his yearly readers' pick for "Worst Biotech CEO". This year's winner is Jim Bianco of Cell Therapeutics, and there seems to be a good case:
Bianco, a longtime worst biotech CEO nominee, broke through this year and finally shoved his way into loser's circle by managing to engineer a 77% drop in his company's price despite finally winning European approval for the its lymphoma drug.
In many ways, TheStreet's biotechnology readers are (dis)honoring Bianco for a lifetime of investor bamboozlement and self-enrichment. The numbers that define Bianco's career as chief executive of Cell Therapeutics are stunning: Total losses of more than $1.7 billion, a 99.99999999% drop in the value of company shares and total compensation for him and his hand-picked team of executive cronies in the tens of millions of dollars.
Other than that, things have been going fine. Check the post for more, and to find out who the runners-up were. You can be sure that they're not thrilled to be on the list, either. . .
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1. Ed on December 7, 2012 1:20 PM writes...
The strange thing is that there are other biotechs out there that willingly engage in these games of "lets pretend we've got a potential blockbuster" with these CTIC clowns - here's looking at you S*Bio and Chroma Therapeutics (pacritinib and tosedostat respectively). And lets face it, they are hardly alone in playing these games.
So long as the dollars are flowing into execs pockets (on both sides of the deal), no one seems to care.
Permalink to Comment2. newnickname on December 8, 2012 9:40 AM writes...
Here is how to become a Head Coach in the NBA or a Manager in MLB: first, become a head coach in the NBA or a manager in MLB.
No matter what you do, no matter how many teams you destroy, no matter how many losing seasons you are responsible for, no matter how many players' careers you might have ruined, no matter how many bad coaching decisions or outright mistakes you make, you're always the leading contender for the next open position.
It's the same in biotech. Once you've been a CEO, no matter that you took one or more good companies and bankrupted them or took good programs and ruined them, there always seems to be a VC waiting for you descend on your golden parachute and take another crack at it.
You've all read the "Management Team" biographies. "Our CEO has 25 years of CEO experience in the biotech industry at ABC (bankrupt), DEF (bankrupt), GHI (bought out at 5 cents on the dollar), JKL (bankrupt) ... and now he takes over our company and we are SOL."
Companies go through stages and need different CEO skills at those stages. Someone who is good at Stage 1 should realize this and step down for a Stage 2 CEO and so on.
I used to read the Boston Globe's "Boston's Highest Paid Biotech CEOs" surveys and there was never a positive correlation between corporate success and compensation. It sickened me that some of these guys were raking in millions as companies foundered.
Permalink to Comment3. marklar on December 11, 2012 11:01 AM writes...
@2
Amen brother. I guess one company's trash is another's treasure.
Permalink to CommentNo one should assume high intellect/performance based upon someone's title (no matter what the title!)