The Effusive CEO

When I read Luke Timmerman’s interview this morning with ISIS CEO Stanley Crooke my immediate thought was “uh oh”.

When public company CEOs become frustrated with the media or stock market response to what they think should be good news they tend to increase the volume.  In this case, Mr. Crooke, disappointed with the market response after releasing the Phase III results of mipomersen back in May, upped the volume by saying mipomersen represents the third “remarkable” drug he has developed.  The other two were cisplatin and cimetidine (Tagamet), both game changers and both blockbusters.

Mr. Crooke has been involved in the development of 19 marketed drugs so he should know.  However, comments like this, true or not, have a tendency to set unrealistic expectations in the marketplace.  And they could get you in trouble down the line with shareholders if things don’t pan out as expected.

Tempting as it is to show real excitement over a drug’s potential, CEOs ( plus CFOs and whomever else is responsible for communicating to the street) need be reminded again and again to stick to the script and let the data speak for itself.  Having said that, I hope Mr. Crooke is right.

 

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About Mike

Mike has been an executive in the biotechnology industry for the past 20 years. Mike is a graduate of University of California, Santa Barbara, earning Bachelors degrees in Business Economics and Geography. Mike also earned his MBA in Finance from California State University, Fresno. Mike is married to the mother of his 3 children and currently lives outside of Boulder, CO. In his spare time Mike enjoys hiking, fishing, skiing, reading and coaching basketball.
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3 Responses to The Effusive CEO

  1. minifesto says:

    You have to understand the character of Stan and the frustration of the long distance runner.

    I have been investing in biotechs for 15 years and feel for the CEOs. It is a long frustrating road to drug approval especially when the FDA moves the goal posts.

    As you can gather I have had my successes and failures as a biotech investor but as I am not a masochist I would not have continued if the successes did not outnumber the failures.

    I do not think that biotech CEOs should communicate with the street. Biotech investing is high risk and for the stout hearted and well heeled who can stand big losses. If you go to the message boards of biotechs you will see the screaming of those who should never has invested in such a risky area.

    • Mike Hart says:

      I understand the frustration perfectly, myself having run Allos Therapeutics and weathering the outcome of a negative ODAC review.

      Here it is 10 months later and Isis just announced the data from the Phase 3 trials. It looks like Stan may be right about mipomersen after all.

  2. minifesto says:

    Mike,

    I read you bio after I posted. I have been investing for 50 years mostly in electronics, oil and forest products. Biotech is a late arrival which affords me intellectual excitement and conversations with many interesting people.

    I was a senior exec in Shell and ITT working in finance, informatics and product line management. I retired at 48, 28 years ago to obtain the two freedoms – freedom from and freedom to. Plus to have time for living. My definition of time is tenacity, imagination, money and experience. Money is the fuel that drives freedom to.

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