[Turn] The pressure of BIOTECH "sky -high" CEO is here

[Transfer] Innovative medicine returns to return to true: Biotech "Sky price" CEO is here

Source: amino observation/Zhu Lai

In the past few years, it is not only the golden age of innovative pharmaceutical companies, but also the "high light moment" of biotechnology practitioners.

Behind the prosperity of the industry, it is bound to be accompanied by the strong needs of talents. The first -level market is turbulent and the door to the market is open, so that the Biotech who holds huge cash digits are not soft. After all, this is the only means to consolidate the company's core competitiveness.

In Zhangjiang, Shanghai, biotechnology talents have changed from one company to another company. There may be no need to change the houses that may be rented, but salary can rise sharply. It is still good to Teacher Zhou Jintao: Life depends on Kangbo.

However, any increase in the industry does not conform to the objective laws of the industry. The capital bubble that was broken also ended the "high light moment" of biotechnology practitioners.

On August 26, the resignation announcement of Dr. Bo Kerui, the Gentao CEO of the 18A company in Hong Kong stocks, triggered a heated market debate.

In the past year and a half, Genting Xinyao's stock price has fallen by 90%, while the total salary of Dr. Bo Kerui, including shares last year, is:

66.16 million yuan.

/ 01 /

Another side of the innovation boom: biotech grabbing people to push high salary

Employees' salary can best reflect the degree of prosperity of an industry.

In the past few years, due to the pursuit of capital in the US biotechnology industry, the happiness of employees has also been greatly improved. As shown in the figure below, the compensation in the US biotechnology industry may be the most watched industry in the past few years.

Like overseas, domestic biotechnology has also been trapped in the internal scroll of talents under capital bubbles, and corporate personnel between Biotech have become the norm.

Of course, in the era of hot money, the most benefit was the executives of the pharmaceutical companies.

Core positions are more scarce, and premiums are inevitable. Take last year, in the case of calculating cash salary alone, there are not a few of the annual salary of domestic biotechnology companies that exceed 10 million.

This is the first 18A listed corporate song gift medicine. In 2021, Dr. Wu Jinzi, the company, reached 19.83 million yuan in cash. In 2021, the cost of Ge Li Pharmaceutical's employee was about 110 million yuan, which means that Wu Jinzi's salary expenditure accounted for 18%of the company's employee costs.

Teng Shengbo, who dominated the first domestic new crown and antibodies, is equally treated with executives. In 2021, Dr. Hong Zhi, the founder of Tengsheng Pharmaceutical, had a cash salary of 36.83 million yuan, accounting for 14%of the company's total salary.

From these figures, although domestic innovative drugs are still in its infancy, executive compensation has been in line with overseas pharmaceutical factories. In 2021, including renewable yuan, Geely and other pharmaceutical companies, CEO compensation was around 6.5 million US dollars.

/ 02 /

It is easy to dig people with high salaries, the company is not easy to develop, and the sky -high CEO is also under pressure

It is understandable that domestic innovative drug companies to bind core executives at high salaries. After all, in the early stage of development, the core executive is the "core asset" of innovative pharmaceutical companies. The premium of this salary is to gain market competitiveness.

However, at present, this is also a "gambling" of biotechnology companies in itself. Because it is easy to dig people with high salaries, it is not easy to make the company develop in the direction of targets.

For many biotechnology companies, the situation is now: Although the executives have received the salary far exceeding the industry average, the company's development does not seem to move towards the expected direction.

As the first 18A company to land in Hong Kong stocks, Ge Li Pharmaceutical has attracted much attention at the beginning of its listing, but now it is "unknown" in the secondary market.

At this point, the stock price is the best observation window: In 2018, the company's IPO issuance price was 14 Hong Kong dollars; on August 26, 2022, the company's latest closing price was 3.51 Hong Kong dollars, a decline of 74.92%.

Of course, the decline in the company's stock price is closely related to the entire capital market cycle, but it is even more affected by business development. Hepatitis C drugs that previously supported the company's valuation, because the impact of competitors was less than expected;

Although the company also has a number of products such as new crown oral medication and oral PD-L1 in the clinical stage, it is necessary to get clinical verification and time test in order to fulfill expectations. In this case, the stock price falls.

This is not the experience of a company in Ge Li Pharmaceutical. Most companies are listed on Fast Follow as the main strategy, and most of them are facing this dilemma.

The basic laws of business are like gravity. Those things that cannot be continued will eventually stop. Today, this high salary position of biotechnology company CEO seems to have also challenged.

/ 03 /

From the foam to the return to calm, the innovative medicine returns to the true

For a long time, the market has regarded core talents as one of the important judgment basis for measuring pharmaceutical companies. In other words, executives are the core assets of pharmaceutical companies.

As mentioned earlier, in order to attract really capable professionals to join, many pharmaceutical companies have paid a lot of salary. The short -term premium may be inevitable.

However, if this premium exceeds the endurance of the enterprise, it will slowly start to fight back the company, and may even become a "negative asset" to swallow the company's cash flow.

In essence, the most important thing to determine the salary of a post is the value created by the position itself.

The core competitiveness of a pharmaceutical company lies in whether the product can be successful. If the pipeline cannot be productized, it is worthless even if it has a good creativity. Especially when the capital environment becomes cold, pharmaceutical companies have become more difficult, and cash flow has become extremely precious resources.

The biggest sadness of a company is not the loss of product research and development, but knowing that the product is very promising but cannot get enough funds to commercialize it. Therefore, rationalized and effectively controlling the consumption of the funding chain of the pharmaceutical company has become a very important thing.

Looking at the world, the medical industry is currently in the cold winter, and even many European and American pharmaceutical companies have begun to be forced to lay off and reduce pipelines. This has been reflected in traditional pharmaceutical companies such as Hengrui Pharmaceutical. Today, the pressure has also come to the new generation of innovative pharmaceutical companies.

Of course, this is a good thing for the domestic innovative medicine industry. Any market that is baptized by foam needs to return to calm.

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