Theratechnologies Inc T.TH

RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:So we go to the gate...

[Wino115]

Here's my own thoughts on your questions.


Do you see any value in people successfully voting off one or two directors?
There is value in shareholders having input to craft the Board they believe is best suited for the "new" Thera, so yes. The Board is elected by the shareholders as the stewards of the company we collectively all own.  They select the management and approve all strategy, budgets and direction the managment they've chosen develops. They've done some of these things wonderfully and probably as best as could have possibly been done. There's the one element that's been a shortfall. We know what it is, they know what it is. Unfortunately, that shortfall cost us the most, new shareholders the least, management and Board not a whole lot either. So even though they "get it" and are rectifying it with as good a plan as they can at the moment and are looking to take shareholder advice to value and supplement cap mkt skills, you could say there is evidence somewhere on the Board of not "getting it" quick enough to push them or help them or make sure the capital market was ready, willing and able to accept the "new" Thera. If you think the Board should be held accountable, withhold from the ones you believe should have understood the pleas we put up here for 12 months.

Do you see any harm in doing so?
It happens here and there, so I don't see any real harm. I don't see any outside PR harm, I don't see any market harm or possibly even much in the way of internal harm. They're not managing the company, just guiding it to keep it on the rails from above. The by-laws allow the appointment of directors intra-year so that's all they'll do and hopefully it will fill that identified skill gap and help Paul and Phillipe with their all-important investment market strategy. I do think they should rewrite parts of their by-laws to add more proper corporate governance.  They shouldn't elect an entirely new Board every year.  There should be staggered terms so there's always some continuity.  The CEO should be on the Board buy wave all compensation given they should have a regular incentivized CEO compensation. They should have terms of more than 1 year, perhaps you vote on groups of 2-3 every 2-3 years. There is a max age-out, which is good.  If there is any harm, it's the harm they would not understand the lesson from a member not being re-elected, but I don't think that would be the case.

My recommendation: Vote knowing full well you own this company 100% and electing your Board is the only voice you have in who oversees your interests and management's plans to build it into a global specialty pharma company over the next few years. I am fully confident they understand the issue (now) and see a real gap in that skillset, so will fill it post the annual meeting.  Perhaps even address it at the meeting. My own view is the Board should not be huge given we have limited resources, so I voted to essentially make room for that new spot.  Other's views seem to center on either the member we think has some financial market expertise, but not perfect N.Am investment banking expertise, or perhaps one who is overly conservative and a bit out-of-touch with how things are done in financial markets today. I'm sure that conservatism has also helped at times, but I don't see anyone on Board or Mangement that's remotely reckless. They're all quite good and have past successes to demonstrate that. 

I do believe that this current Board is a little anachronistic in that it's sort of built by friends-and-family, which is often the case for very small companies who can't always attract who they want.  So I'm not saying anachronistic in a pejorative way, it's just that's what it is, like many smallco Boards. It should, and I think they're trying, to break out of that  a bit, but they probably need to be nudged more as they seem to more or less immediately fill spots with accomplished local Montreal businessmen.  That's not really the way to do it, and they likely now that at this point. Boards should have skills in them, independence in them, vast experiences in them, and all that should lead to the tension and debate that makes optimal decisions, not ones dominated by someone or not ones that aren't creative, fully debated from all sides and potentially bad.  Groupthink and rubber-stamping has no place on a Board.  I have no idea and no way to know their deliberations so I'm making that comment as a general statement on how a well-functioning Board should work.  I would certainly hope that's how they have and I suspect they would agree. But to assure that, you want a bunch of people not beholden to someone or in the same mileau where that could arise. 

Enough said -- vote your conscience since you own this company and have to build your Board. 

Lastly, given there's a slew of new shareholders who will vote the slate, the chances of someone not making it over the hurdle are pretty low.  But a message can be sent still. There's probably this vote and next year's where it will be this number of shares outstanding.  After that, we would hope there's some others on board at much higher prices!

realitycheck4u wrote:

Wino,

Million dollar question incoming. Do you see any value in people successfully voting off one or two directors?  Do you see any harm in doing so?  What harm?  And, what do you recommend?

 

Wino115 wrote: I have found in almost every endeavor, experience counts immensely. 
 

 

scarlet1967 wrote:

Let’s look at two scenarios, one the actual events and one a hypothetical version starting with the announcement of perusing HIV NASH program.

The first scenario the actual events:

The announced they will peruse the HIV NASH after a long wait (presumably because of changing the plan to go with General NASH), later on last year they eventually they announced they will go with General NASH based on the advices by the KOLs and they planned a meeting with agencies in few weeks, I believe they knew the market would be somehow skeptic so they brought in Dr. Grinspoon and Dr. Roomba to answer questions. They then decided not to announce the date of the submission of the protocol, the few weeks ended up being few months until early this year they announced both protocols were submitted and both got the letter may proceed from FDA but nothing about EMA. Soon after they closed the offering and the investor presentation was down for more than one week right after the closing so new to be investors couldn’t really make an educated assessment whether they should offload their position for a quick profit or they should stay put because they could make more profit due to potentials of the program.

The second hypothetical scenario:

They announced the HIV NASH and instead of waiting a long time as soon as they planned to explore the idea to go with NASH they would inform the market that they potentially will change their plan and are in the process to validate their decision by consulting the KOLs, why? Because the long wait between the two news killed all the excitement so they could keep the story relevant by communicating all the stages of their decision making process.

They knew the market will be skeptic so they should produce that life science report before the general NASH announcement to mitigate some of the skepticism.

They should also upgrade the website in advance to maximize the effect of the good PR. Although not conventional they should inform the market when the protocol was submitted why? Because surly it would not affect the agency’s response but by not announcing the submission they created more uncertainty about the legitimacy of the protocol, they effectively send a message that they are not confident about the protocol fearing rejection. They would also communicate more clearly as where they stand with the EMA re the NASH.

After the good PR they would wait for the information to get digested by the market and attend few conferences explaining the protocol to both retail and institutional investors, the net result would be an appreciation of the valuation and potentially much better deal as their science and its risks/rewards had been explained and understood by the market so instead of almost not getting ascribed any value to the program some value would be baked in to the SP.

In my view they didn’t handle the information flows correctly, it wasn’t lack of marketing but really bad marketing, many wrong decisions were made leading to the current low demand/valuation. They seem to agree with part or all of this assessment as they will RE-engineer the company’s marketing. My concern is after a number of bad moves from this company how much faith one can have in their abilities to RE-engineer? Of course the board is not involved with day to day activities but we are talking about big strategic decisions which a proactive board ideally should be involved with.