Andrey Semechkin
About Andrey Semechkin
Andrey Semechkin, Ph.D., is Co‑Chairman and Chief Executive Officer of International Stem Cell Corporation (ISCO). He has served as CEO since November 2009 and as a director since December 2008; he is 65 years old and is a specialist in system analysis, strategic planning, and corporate management, with recognition including membership in the Russian Academy of Sciences and the Russian Government Award in Science and Technology (2006) . Over 2024–2023, ISCO’s reported pay-versus-performance data shows cumulative TSR values of 133.33 and 33.33, respectively, against net losses of $209,000 and $131,000, providing a two-year read on shareholder outcomes during his tenure . Semechkin is the father of Russell Kern (EVP/CSO and director), underscoring a dual-role governance dynamic on ISCO’s board .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Institute of System Analysis (Russian Academy of Sciences) | Deputy Director | 2004–2011 | Led system analysis and strategic planning; senior scientific administration |
| Russian Academy of Sciences | Member | Not disclosed | Scientific recognition; supports technical credentials |
| International Stem Cell Corporation | Senior management prior to CEO | 2008–2009 | Transitioned into CEO role; continuity in leadership |
External Roles
| Entity | Role | Years | Notes |
|---|---|---|---|
| X‑Master, Inc. | Owned by Semechkin; Kern is President | Not disclosed | Holds preferred shares convertible into common; shares deemed beneficially owned by Semechkin and Kern |
| AR Partners LLC | Owned by Semechkin and Kern; Kern is GM | Not disclosed | Holds preferred shares convertible into common; shares deemed beneficially owned by both |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus (%) | Actual Bonus ($) | Option Awards ($) | Total ($) |
|---|---|---|---|---|---|
| 2024 | 66,480 | — | — | — | 66,480 |
| 2023 | 66,560 | — | — | 46,305 | 112,865 |
Notes:
- ISCO states it is a smaller reporting company and does not provide CD&A; executive benefits are broad-based with no 401(k) match, and no defined benefit or deferred compensation plans .
Performance Compensation
Option awards for Semechkin (structure and vesting):
| Grant Date | Options (#) | Exercise Price ($) | Expiration | Vesting Schedule |
|---|---|---|---|---|
| Nov 6, 2023 | 500,000 | 0.12 | Nov 6, 2033 | 3/36th on Feb 6, 2024; remainder in equal monthly installments over 33 months |
| 2021 (year) | 250,000 | 0.39 | 2031 | 3/36th on Sept 9, 2021; remainder monthly over 33 months |
| 2022 (year) | 1,000,000 (888,889 exercisable; 111,111 unexercisable) | 0.45 | 2032 | 3/36th on July 25, 2022; remainder monthly over 33 months |
| 2019 (year) | 150,000 | 1.51 | 2029 | Fully vested by 12/31/2024 |
| 2018 (year) | 200,000; 150,000 | 1.51; 1.58 | 2028 | Fully vested by 12/31/2024 |
| 2017 (year) | 69,444; 54,444 | 1.09; 1.10 | 2027 | Fully vested by 12/31/2024 |
| 2016 (year) | 200,000 | 2.30 | 2026 | Fully vested by 12/31/2024 |
Additional notes:
- No options were granted to named executive officers during 2024 .
- Equity plans provide for full acceleration of unvested options if not assumed/substituted upon a “Change in Control” (single-trigger acceleration tied to non-assumption), under both 2006 and 2010 plans .
Pay versus performance (contextual outcomes):
| Year | Compensation Actually Paid to CEO ($) | Cumulative TSR (Value of $100) | Net Income (Loss) ($) |
|---|---|---|---|
| 2024 | 142,552 | 133.33 | (209,000) |
| 2023 | 81,567 | 33.33 | (131,000) |
Equity Ownership & Alignment
| Holder | Beneficial Ownership (shares) | Percent of Beneficial Ownership | Notes |
|---|---|---|---|
| Andrey Semechkin | 15,320,299 | 72.46% | Includes 11,053,973 shares issuable upon conversion/exercise within 60 days |
| Combined Preferred Voting Power (Semechkin & Kern) | — | 72.3% of preferred stock voting power | Preferred stock convertible into common; vote together with common (except Series I‑2) |
Vested vs. unvested/exercisable positions (options at 12/31/2024 for Semechkin):
| Year Granted | Exercisable (#) | Unexercisable (#) | Exercise Price ($) | Expiration |
|---|---|---|---|---|
| 2023 | 180,556 | 319,444 | 0.12 | 2033 |
| 2022 | 888,889 | 111,111 | 0.45 | 2032 |
| 2021 and earlier | 1,073,888 (sum of prior grants) | — | Varied | 2026–2031 |
Insider trading and hedging/pledging:
- ISCO maintains an insider trading policy (Exhibit 19.1 to the 10‑K); the proxy does not disclose hedging or pledging restrictions explicitly .
Employment Terms
- CEO start date and tenure: CEO since November 2009; Director since December 2008 .
- Employment/Severance agreements: ISCO states it does not have severance agreements with Dr. Semechkin (or Dr. Kern) .
- Change-of-control: Unvested options fully accelerate if not assumed or substituted by an acquiring entity under equity plans .
- Clawback provisions: Not disclosed in proxy; the company references a Code of Conduct and Ethics applicable to directors/officers/employees .
- Other: Group insurance benefits; no 401(k) match; no defined benefit or non-qualified deferred compensation plans .
Board Governance
- Role: Co‑Chairman and CEO; dual-role concentration with familial relationship (father of director/executive Russell Kern) .
- Board composition: Four directors; two independent (Paul Maier and Donald Wright) under Nasdaq rules; independent directors hold executive sessions without management .
- Committees: Audit Committee—Paul V. Maier (Chair), Donald A. Wright; Maier designated audit committee financial expert . Compensation and Governance Committee—Donald A. Wright (Chair), Paul V. Maier .
- Activity and attendance: Board met once and acted by unanimous written consent once in 2024; each director attended at least 75% of aggregate meetings .
Director Compensation (Semechkin-specific)
- Directors who are employees do not receive additional board compensation; non-employee directors receive retainers and options per policy; Semechkin receives no incremental director pay beyond his executive compensation .
Related Party Transactions
- CEO financing: ISCO issued an unsecured, non-convertible note to Semechkin ($2.9M at 4.5% on 9/15/2022), extended to 9/15/2024; on 9/15/2024, $200k principal was repaid and a new $2.7M note was issued, extended to 9/15/2025 at 5.5% interest .
- Facilities co-tenant arrangement: ISCO co‑leased HQ with S Real Estate Holdings, LLC (owned by Kern), personally guaranteed by Kern; ISCO paid $56,322 in 2024 for its 40% share of costs .
Compensation Structure Analysis
- Mix and trends: Semechkin’s compensation is predominantly fixed cash salary with equity via options; 2024 had no new option grants, following 2023 grants, yielding lower reported SCT total in 2024 vs 2023 . Long-term incentives rely on time-based vesting, not disclosed performance metrics; options can accelerate upon change-in-control if not assumed .
- Governance considerations: Dual-role CEO/Co‑Chairman and family tie to EVP/CSO/director increase independence concerns; only two independent directors; board met infrequently in 2024 .
- Say-on-pay cadence: Company recommends say-on-pay frequency of three years (triennial), potentially reducing near-term feedback on compensation alignment .
Equity Ownership & Alignment Implications
- Control dynamics: Semechkin beneficially owns 72.46% of common (incl. options and convertible preferred) and, together with Kern, controls ~72.3% of preferred voting power—material control that can limit external governance pressure but aligns economic outcomes with management .
- Vesting and potential supply: Large 2022–2023 grants vest monthly through 2025–2026, creating a steady stream of newly exercisable shares that could translate into periodic liquidity events depending on personal disposition and trading windows .
Say‑on‑Pay & Shareholder Feedback
- 2025 agenda includes advisory vote on executive compensation; board recommends triennial frequency for future votes .
Expertise & Qualifications
- Scientific and managerial credentials include membership in the Russian Academy of Sciences, deputy directorship at Institute of System Analysis, and the Russian Government Award (2006); authored scientific books, with 20+ years managing businesses across industries and scientific sectors .
Work History & Career Trajectory
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| ISCO | Co‑Chairman & CEO | CEO since 2009; Director since 2008 | Executive continuity; strategic oversight |
| Institute of System Analysis | Deputy Director | 2004–2011 | Senior scientific administration |
| Various scientific/business roles | Specialist/system analysis leadership | Not disclosed | Multi‑industry experience |
Investment Implications
- Alignment and control: Extremely high beneficial ownership and preferred voting control align CEO outcomes with equity performance but concentrate governance power; dual-role CEO/Co‑Chairman plus father-son board/executive relationship elevates independence risk and may limit Board counterweights .
- Compensation risk: Absence of disclosed performance metrics for incentives and use of time-based options lowers explicit pay-for-performance linkage; single-trigger acceleration upon change-in-control if awards are not assumed can incentivize transaction timing rather than sustained operational metrics .
- Liquidity/selling pressure: Ongoing monthly vesting from 2022–2023 grants through 2025–2026 increases potential for intermittent insider selling, subject to trading windows and personal liquidity needs .
- Related-party and financing reliance: CEO loans (extended and increased interest) and co-tenant facility arrangements with Kern’s entity reflect reliance on insider financing and related-party structures—red flags for some governance screens and potential conflict considerations .
- Performance context: Two-year pay-versus-performance shows improved TSR in 2024 vs 2023 alongside continued net losses; sustained value creation will hinge on translating scientific milestones into financial performance, which is not explicitly embedded in disclosed compensation metrics .