This reflects what we see from the recruiter’s side of the table, which is a useful vantage point when you are planning your own next move. Biotech executive compensation is weighted toward equity, which means the negotiation that matters most is about terms and structure rather than the headline grant size. Candidates routinely negotiate the percentage and accept the mechanics as given, which is backwards, because the mechanics determine whether the percentage ever becomes money.
Key Takeaways
- Terms and structure matter more than the headline grant size.
- Understand where common equity sits relative to preferences.
- Vesting, acceleration, and exercise windows shape real value.
- Dilution from future financing rounds is often underestimated.
- Get the documents and have them reviewed before deciding.
Ask What the Grant Actually Represents
A percentage figure means little without context: what the capitalisation table looks like, how much has been raised and on what terms, what liquidation preferences exist, and how much further dilution is anticipated before an exit. Common equity in a company that has raised substantially on preferred terms can be worth far less than the percentage implies in many outcomes. Ask for the capitalisation details and the preference structure, and ask directly what the equity would be worth under several exit scenarios, since companies that will not discuss this are telling you something.
Vesting, Acceleration, and Exercise Mechanics
The mechanics determine whether you ever realise value. Vesting schedule and any cliff determine what you keep if you leave or are removed. Acceleration provisions on change of control or termination without cause matter enormously in a sector where companies are acquired and programmes fail. Post-termination exercise windows determine whether you can afford to exercise options if you depart. Each of these is negotiable, and in biotech, where tenure is frequently cut short by events outside your control, they often matter more than the grant size.
Anticipate Dilution Realistically
Biotechs raise repeatedly, and each round dilutes existing holders. A grant that looks meaningful today may be substantially smaller by the time an exit occurs, particularly for companies that will need several more financings. Ask how much the company expects to raise before an exit and what dilution that implies, and consider negotiating anti-dilution protection or refresh grants tied to milestones rather than relying on the initial number. Candidates who model only the current position frequently find the eventual outcome disappointing for reasons that were foreseeable.
Get the Documents Reviewed
Equity arrangements are legal instruments with consequences that are not obvious from a term sheet summary, and the tax treatment of different structures varies considerably by jurisdiction and circumstance. It is entirely normal to request the plan documents and grant agreement during the offer process and to have them reviewed by a lawyer, and by a tax adviser where the amounts justify it. This is not general financial advice and your situation may differ substantially, so professional review of your specific documents is worth the cost given what is usually at stake.
What This Looks Like in Practice
A biotech executive candidate requests capitalisation and preference details, asks what the equity would be worth under several exit scenarios, negotiates vesting, acceleration, and post-termination exercise terms explicitly, anticipates dilution from expected future rounds, and has the plan documents reviewed professionally before accepting.
The Mistake Candidates Keep Making
The most common mistake is negotiating the percentage while accepting vesting, acceleration, exercise windows, and the preference structure as standard. In biotech, where tenures are frequently ended by a clinical result or a financing failure, those terms determine outcomes far more often than the grant size does. The candidate optimises the number and leaves the mechanics that govern it untouched.
What to Examine in a Biotech Equity Grant
| Element | Why It Matters |
|---|---|
| Preference structure | Determines what common receives in many exits |
| Vesting and cliff | What you keep if tenure is short |
| Acceleration provisions | Protects value on acquisition or removal |
| Exercise window post-departure | Whether you can afford to exercise |
| Expected future dilution | Reduces the effective grant substantially |
The Bottom Line
In biotech offers the equity mechanics matter more than the headline percentage, so examine the preference structure, vesting, acceleration, and exercise terms, anticipate dilution from future rounds, and have the actual documents reviewed by a lawyer and tax adviser given how much typically rests on them. Be deliberate about this, and you will be choosing between offers rather than hoping for one.
Related Reading
For more, see Transitioning from Big Pharma to Biotech Leadership, Preparing for a Pharma C-Suite Interview, What Pharma Recruiters Wish Candidates Knew.
Frequently Asked Questions
- Q: Why does the percentage matter less than the terms?
- A: Because vesting, acceleration, exercise windows, and the preference structure determine whether equity becomes money, particularly in a sector where tenure is often cut short by external events.
- Q: What should I ask about the capitalisation table?
- A: How much has been raised and on what terms, what liquidation preferences exist, how much further dilution is anticipated, and what the grant would be worth across several exit scenarios.
- Q: Why do acceleration provisions matter in biotech?
- A: Because companies are frequently acquired and programmes frequently fail, so what happens to unvested equity on a change of control or termination without cause is consequential.
- Q: How should I think about dilution?
- A: Ask how much the company expects to raise before an exit and what dilution that implies, and consider negotiating refresh grants tied to milestones rather than relying on the initial figure.
- Q: Should I get professional advice?
- A: Yes; these are legal instruments with tax treatment that varies by jurisdiction and circumstance, so have the plan documents and grant agreement reviewed by a lawyer and, where warranted, a tax adviser.
![](https://www.jrgpartners.com/wp-content/uploads/2025/12/tanya-gallardo.jpeg")
Tanya Gallardo
Managing Director, Executive Search & AI Talent Strategy
Tanya Gallardo is the Managing Director of Executive Search & AI Talent Strategy at JRG Partners, leading C-suite and Board engagements across key growth sectors including Technology, Financial Services, and Manufacturing.
With over 18 years of experience specializing in disruptive technology leadership, Tanya is recognized as a leading authority on talent architecture for future-focused executive roles, such as the Chief AI Officer (CAIO) and Chief Digital Officer (CDO). Her expertise lies in accurately assessing the cultural fit and technical depth required to ensure a high return on investment (ROI) for critical leadership appointments.
Prior to her role at JRG Partners, Tanya held senior roles directing global talent acquisition strategies at a major publicly-traded technology firm, advising on organizational design and succession planning for emerging executive functions. She is a recognized speaker and contributor to industry events, sharing data-driven insights on executive compensation, leadership development, and the measurable business impact of C-suite talent.
