Pricing performance fairly: a biotech case study

A context of strong value creation

Under the leadership of its new CEO — a Doctor of Pharmacy and former global specialist in the pharmaceutical industry — the company has reached several key milestones, paving the way for future discussions with industrial partners and a new phase of development.

As the company progressed, the strategic board wanted to reward the CEO’s performance with a new BSPCE grant. But first, they needed to set a fair strike price, consistent with the value created since his arrival.

“We needed to objectify the decision and support it with credible figures aligned with practices in our sector,” explains the CEO.

The challenge: establishing a fair price in a demanding context

Granting BSPCE to a CEO is never trivial. The process involves tax considerations, internal governance, and recognition of work accomplished.

In this case, several complexities overlapped: an urgent timeline, complex modelling due to the clinical sector, and the need to strike a balance between fairness and performance.

As the CEO summarizes, « There’s no exact number in this kind of discussion — the challenge is to find an objective, understandable, and defensible benchmark.».

To ensure this level of objectivity, the company turned to Sovalue, recommended for its expertise in BSPCE valuations in the biotech sector.

The Sovalue solution: rigor, clarity, and sector expertise

A tailored approach built on method and transparency

From the very first exchanges, the Sovalue team carried out a comprehensive company valuation analysis, based on multiple models and scenarios.

Three distinct approaches were presented, taking into account the specificities of the biotech sector: clinical risk, illiquidity, and liquidation preferences.

The final result showed an average valuation consistent with that of the investment bankers appointed for the fundraising — a convergence that strengthened the credibility of the work presented to the board.

« It’s always interesting,” notes the CEO, “to see that different approaches lead to consistent results. It proves the soundness of the reasoning ».

A smooth and responsive collaboration

The mission, completed under a very tight deadline — “around Easter weekend, a complicated period” — stood out for the responsiveness and rigor of the Sovalue team.

«We provided as much information as possible from the start, and the team worked tirelessly to deliver the numbers on time,” recalls the CEO.

But beyond speed, it was the team’s educational approach that marked the collaboration. Coming from the pharmaceutical world rather than finance, the CEO appreciated having « a patient and pedagogical counterpart, able to explain complex models in simple terms. »

« It wasn’t just a deliverable,” he adds. “It was genuine support — I understood what was being done, why it was done, and how to present it to my board ».

Support beyond the deliverable

Even after delivering the final report, Sovalue remained available: providing additional explanations, reviewing assumptions, and sharing insights on valuation practices within the biotech sector. A constructive relationship that continued well beyond the mission.

“I myself was a consultant for more than ten years,” the CEO shares. “And I recognized in Sovalue an approach I value: intelligent consulting that continues to enrich the client’s thinking even after the project is completed.”

The results: objectivity, fairness, and peace of mind

Our work enabled the biotech company to establish a clear and defensible framework for internal discussions around the BSPCE allocation.

The report served as a reference point, bringing the rigor needed to reconcile fairness, compliance, and recognition of the work achieved.

Our conclusions — aligned with the estimates of the investment bankers — reassured the board and secured the tax compliance of the strike price. The final result was deemed “balanced and consistent with expectations” by all parties.

“Sovalue lives up to its name: it truly brings added value.”

A rare expertise in the biotech world

If the CEO had to highlight one key takeaway from this collaboration, it would be Sovalue’s deep sector understanding.

“I immediately saw that they were practitioners of our field. They know that a biotech company in clinical development doesn’t operate like a SaaS startup.”

This methodological precision allowed the team to deliver a valuation fully aligned with the company’s realities.

He also emphasized the credibility of Illan Glaubert, founder of Sovalue, recognized for his expertise in valuation and BSPCE matters. Sovalue’s team was even approached by Bercy as part of the BOFiP reform, contributing to a dedicated working group and submitting an amendment proposal to the Tax Legislation Directorate in 2024.

Convinced by the quality of the support he received, the CEO would not hesitate to recommend Sovalue to other leaders in the sector facing similar challenges.

Key takeaways

In a context where every BSPCE allocation must be justifiable both to the board and to the authorities, objectivity is essential to building trust.

Our support enabled this biotech company to anchor that trust on solid foundations: precise figures, a clear methodology, and accessible explanations.

Sovalue stands for a fair, compliant, and intelligible valuation — one that supports value creation without distorting it.

Do you need to set or update the strike price of your BSPCE?
Reach out to Sovalue to obtain a clear, well-documented, and tax-compliant valuation.

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