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Ebb & Flow

With Genentech's takeout now complete, industry watchers will be looking for when the biotech's executives will head for the exits. Based on the structure of the bonus payouts in the employee retention plan, a number of the company's senior managers have at least seven-figure reasons to stay around another 12 months when the other half of their retention bonus comes due.

The retention clock began ticking last Thursday when Roche (SIX:ROG) consummated its tender offer for the rest of Genentech it did not already own.

The bonus money to be paid under company's employee retention plan was laid out in an 8-K filing made by Genentech last August.According to Roche's tender offer dated Feb. 9, if the merger completed on or before June 30, the payout of the retention bonuses was tied to treatment of Genentech's employee options.

If vesting was not accelerated, the entire retention bonus was to be paid out when the merger completed. But if vesting were accelerated, then the two-step retention payout would apply.

Last week, Genentech spokesperson Geoffrey Teeter said the the vesting had been accelerated.

Thus, based on the $95 deal price, executives such as CEO Arthur Levinson and President of Product Development Susan Desmond-Hellmann are in line to receive total retention bonuses of $8.7 million and $4.6 million, respectively, if they stick around until March 26, 2010 (see "Pay to Stay").

Fit to partner

While Merck Serono concluded it didn't have the wherewithal to compete in diabetes, Genfit (Euronext:ALGFT) is betting it can prosper in the space using an outlicensing strategy for its growing portfolio of drug candidates.

Genfit was up €0.20 to €6.20 last week after receiving exclusive worldwide rights to Merck Serono's MKG02 program to treat Type II diabetes and obesity.

Chairman Jean-Francois Mouney said the biotech plans to develop MKG02 through Phase II, at which point it will look for a partner.

Genfit's other diabetes compounds include

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