Last week I had the chance to attend the 2024 Dutch Biotech Event organized by hollandbio. It was an afternoon packed with inspiring talks, great discussions, and new connections. The program included four parallel breakout sessions. I picked one named “The Basics of Biotech Board Management.” The session was organized as a panel, with three cool biotech executives with range of experience with being board memebrs: Eline van Beest (CEO of Hybrize Therapeutics), Felice Verdyun (Partner at EQT Life Sciences), and Mirjam Mol-Arts (pharma executive previously at companies including Organon and Ferring Pharmaceuticals). I chose this session, as I reasoned that it will be where I learn the most in the shortest amount of time. Good bet, the only time I stopped taking notes was when I raised my hand to ask questions! Below is a summary of these notes. Anyone who is biotech and interested in what makes a good board and how to manage it should find this insightful.

Takeaway #1: As in the kitchen, so in the boardroom: stick to a handful of high-quality ingredients.

In smaller companies you may have quite a lot of flexibility on who is on a board. In larger and especially listed companies you will have a number of rules and regulations that you have to follow. But irrespective, one rule holds as much in the kitchen as it does in the boardroom: to make a great dish, start with great ingredients. And yes, you can also overpower a great dish by mixing too many flavors at once. Here is what this means for boards:

  • Think hard about whom you offer a board seat to. Board should have only as many people as it needs, and not more.
    • If you can offer a scientific advisory seat instead, do it.
  • The best time to start a board is BEFORE you raise an investment. It allows you to keep investors off the board.
  • Investors are the ultimate split-personalities on any board. They are in constant conflict of interest between representing their LPs (i.e. cashing quickly and at the highest multiple possible), and building a sustainable business (something that the CEO wants and that creates more value in the long-term).
  • To further reduce conflicts of interest, prefer independent board members. As much as you can, try to have more than half of the board seats independent.
  • Before you become a part of any board meeting, make sure to follow some courses on corporate governance. Similarly, help members of your boards to do so as well!
    • You can also include governance-related training as part of the pre-board meeting sessions.
An ideal investor should always be able to identify if they are representing the interests of their LPs or the ones of the company, as these will not always be aligned. In practice this is nearly as difficult as it was for the Sorting Hat to decide if Harry belongs to Slytherin or Gryffindor.

Takeaway #2: It is not talking behind closed doors if everyone does it, right?

Boards of directors may seem serious. They will certainly appear somewhat abstract to anyone who has not been part of one. Throught this breakout session, I was reminded that boards are made of board members, and these are, drumroll … people! People, who are mostly normal, that is. Consequently, managing a board will be, more than anything else, managing people. To do so, you will end up talking with them often, including outside of an actual board meeting:

  • You will spend (a lot) time for preparation, including talking with board members one-on-one (more on that later).
  • Board meetings will often be preceded by a pre-meeting. This may include more scientific, technical, or open ended discussions. Only these will likely last longer than the board meeting itself!
    • These are great opportunities to make sure everyone on the board has the necessary technical, operational, or other background needed for effective management.
  • Board meetings will be commonly followed by an executive session.
    • Executive sessions are confidential, and give the board the chance to address any internal friction and reflect on its operation. Frequently, the CEO will be absent from this session, or its part, offering the board a chance to reflect on their performance (i.e. trash-talk them).
  • Culture will impact where and how board-matters are addressed. The Dutch have a low-context culture, which means that they mean what they say, and address each other directly. On the other hand, Britts are generally much more soft spoken, and wrap their statements in politeness formulas, such as “Did you have a chance to…?”, “Would you mind if I… ?”, and “We should be mindful about…”.
    • Soft-spoken cultures tend to have more talking happen out of a board room.
  • Finally, irrespective of cultural differences, board dinner will probably be the occasion where most matters are discussed. Don’t leave it out!

Takeaway #3: Do as a good scout would: be prepared!

This probably should not have come as a surprise. As in nearly everywhere in life: if you want to do well, make sure you also prepare well. What did surprise me a bit though, was what is the amount of preparation that will be helfpul. The answer? A lot. Here is how to do it and not go crazy:

  • Send out quarterly report sufficiently ahead of the meeting
    • Keep updates in meetings short and snappy. This has the added advantage of leaving everyone energized.
  • Schedule a dedicated preparatory meeting with every board member ahead of time.
    • The goal of this meeting is to understand points of view, opinions, concerns, and eventual fears. The meeting is there to resolve and address these before the actual board meeting.
    • It’s fair to have disagreements and contrarian opinions. But you want them to be known, with a strategy on how to address them, before the board meeting.
  • The most important person you want to give a clear briefing on the agenda and points in it to is the meeting chairman. They are the person with the most agency over how smoothly the meeting will run.
  • Whenever adequate and possible, include a presentation and potential Q&A with the company team during a board meeting. This requires some forethought, but will be appreciated by both the board and the team.
  • Finally, do not neglect to send good summaries.
From Calvin & Hobbs, January 11, 1986.

Lot of the advice here is common sense. It is particularly because of this that I found it useful to hear. For anybody entering their first board, you will walk in assuming others probably know how things should be done, and try not to stick out too much or ask too many questions. What I am taking from this session is that if something does not seem right, it may as well not be. Boards are, after all, made of people, and people make mistakes and can sometimes be lazy. So yes, you by all means should have high standards. You can also ask about things you don’t understand. Now, you know that the best time to do this is not in the board meeting, but in the number of interactions and meetings around it.

Thanks for reading everyone! If you found this post useful, or have an insight on biotech boards from your own experience, drop me a message in the comments below. Finally, you can subscribe to this blog and receive posts like this directly to your mailbox.