Firestone: Why I left Polartechnics, and why I would return

Medico and property investor Richard Opara resigned as interim chairman of Polartechnics (ASX:PLT) on June 8. The next day, US biotech executive Len Firestone stepped down as a director.

On August 12, Polartechnics (ASX:PLT) will hold an extraordinary general meeting in Sydney to decide on resolutions put forward by Opara. The EGM will decide whether Opara and Firestone will return, replacing Polartechnics' current CEO Victor Skladnev and Robert Hunter as directors.

Asked his opinion about Polartechnics' directors, Firestone -- a former professor of medicine at Yale -- is quick to praise, saying that they "are honourable people" that he has "great respect and admiration for".

"I enjoyed working with them very much during the time I was on the board," he told Australian Biotechnology News from San Diego this week.

But, he said, "intelligent people will disagree on many things and I resigned from the board because I had a different vision for these products to work."

His vision, he said, is forged from pragmatism. "My concern about Polartechnics falls right out of the balance sheet," he said. "If you look at the burn rate, look at the balance sheet and the money that's at hand, a fund raising needed to be imminent."

Firestone said he was willing to return as a Polartechnics director so long as the company developed a judicious business plan, "for some reasonable period of time, more than just a few months".

"I think that's critical, so that management can really focus on product development rather than worrying about the next pay cheque," he said.

Firestone said he also respected Polartechnics' management, particularly the product managers, and was a keen supporter of Polartechnics products, particularly the company's SolarScreen melanoma detection system.

"I don't know which of the moles on my body right now is in the process of developing into a melanoma," he said. "I don't think we could get this product to market too fast."

To his mind, getting Polartechnics' products to the market quickly is a win not only for shareholders, but patients. "Everything starts and finishes with the shareholders' interest and the patients' interest at heart. They're one and the same really," he said.

However, he acknowledges that there is room for disagreement on any board about what is meant by 'shareholders' interest'.

In general, Firestone believes that boards on biotech companies "should be able to disagree without disintegrating".

"There needs to be boards comprised of people who are reasonably compatible."

And "management should be utterly pragmatic... hope for the best but expect the worst," he said.

That strong belief in pragmatism is behind Firestone's description of his relationship with Opara as "excellent". "We're both very pragmatic and realistic in our assessment of business opportunities and challenges, and in the time that we've worked together, we found that there's essential agreement on many of the observations that we make," he said.

"I have the utmost respect for Richard, I feel that I'm fortunate to work with him," he said. The opportunity to work with Opara, he said, was one of the many reasons he chose to become CEO of Avantogen (formerly Australian Cancer Technology) (ASX:ACU), another compny in which Opara is a major shareholder.

As an American board member and CEO, and considering the Sarbanes-Oxley Act in the US which followed Enron and WorldCom, Firestone is acutely aware of the need to think in a fiduciary way rather than as an individual.

"Every board member is expected to step up to the plate and be responsible for certain outcomes. That's important in every nation," he said. "What's at issue at Polartechnics is how to get these products into the broad marketplace, and I think more fiduciary thinking on the board is really going to be the answer."