Stephen Wills
Chief Financial Officer, Chief Operating Officer, Executive Vice President, Secretary and Treasurer at PALATIN TECHNOLOGIES
Executive
About Stephen Wills
Stephen T. Wills, age 68, is Palatin Technologies’ Chief Financial Officer (since 1997), Chief Operating Officer (since 2011), Executive Vice President, Secretary and Treasurer; he is a CPA with a B.S. in accounting (West Chester University) and an M.S. in taxation (Temple University) . Company performance in fiscal 2024: revenue $4.49 million vs. $4.85 million in fiscal 2023; net loss $(29.7) million vs. $(24.0) million; cash $9.5 million vs. $8.0 million, framing the operating backdrop for incentive outcomes . Say-on-pay support was ~58% of votes cast at the June 2024 meeting, indicating mixed shareholder sentiment towards pay design .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Derma Sciences, Inc. | Executive Chairperson & Interim PEO | 2015–2017 | Led transition to sale to Integra Lifesciences (Nasdaq: IART) |
| Derma Sciences, Inc. | Lead Director; Audit Chair | 2000–2015 | Governance oversight during growth and eventual sale process |
| Derma Sciences, Inc. | Chief Financial Officer | 1997–2000 | Built finance function for advanced wound care portfolio |
| Wills, Owens & Baker, P.C. | President & COO | 1991–2000 | Led public accounting operations and client services |
| Cactus Acquisition Corp (SPAC) | Chief Financial Officer | 2021–2024 | Managed SPAC finance through sponsor transition |
| Caliper Corporation | Board Chair | 2016–2019 | Oversaw sale to PSI (Talogy) |
| The Hun School of Princeton | Board Chair | 2018–2023 | Stewarded governance and executive committee leadership |
External Roles
| Organization | Role | Years | Committees |
|---|---|---|---|
| MediWound Ltd. (Nasdaq: MDWD) | Director | 2017–present | Audit Chair; Comp Committee member |
| Enzon Pharmaceuticals (OTC: ENZN) | Director | 2025–present | Not disclosed |
| Gamida Cell Ltd. | Director | 2019–2024 | Audit Chair; Comp Committee member; company acquired by Highbridge Capital |
| Amryt Pharma Plc | Director | 2019–2023 | Audit Chair; Comp Committee member; company acquired by Chiesi Farmaceutici |
Fixed Compensation
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Base Salary ($) | 650,000 | 650,000; increased to $670,000 effective 7/1/2024 |
| Target Bonus % of Salary | ≥60% policy | ≥60% policy |
| Actual Annual Incentive ($) | 243,800 | 431,500 (includes $331,500 annual incentive at 85% of target + $100,000 transaction bonus for Vyleesi sale) |
| Stock Awards – Grant Date Fair Value ($) | 148,500 | 170,700 |
| Option Awards – Grant Date Fair Value ($) | 134,100 | 155,800 |
| All Other Compensation ($) | 16,750 (401(k) match) | 16,644 (401(k) match) |
| Total Compensation ($) | 1,193,150 | 1,424,644 |
Long-Term Incentive Targets vs Granted
- Target LTI opportunity: 235% of base salary (Wills); reduced to 78% of base salary in FY 2023 and FY 2024 to conserve share usage .
- Equity mix: ~50% performance-based RSUs and ~50% performance-based options; remainder time-based .
Performance Compensation
| Corporate Objective Category | Weight | Achievement Level | Discretionary Adjustment | Weighted Achievement |
|---|---|---|---|---|
| Vyleesi SF Program | 30.0% | 75.0% | 12.5% | 35.0% |
| Vyleesi Obesity Program | 5.0% | 50.0% | 0.0% | 2.5% |
| Anti-Inflammatory Programs | 25.0% | 40.0% | 0.0% | 10.0% |
| Ocular Programs | 25.0% | 70.0% | 5.0% | 22.5% |
| Other Corporate | 15.0% | 100.0% | 0.0% | 15.0% |
| Total Payout | 100% | — | — | 85.0% |
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FY 2024 bonus math (Wills): base $650,000 → target ≥60% = ≥$390,000; payout at 85% = $331,500; plus $100,000 cash bonus for the Vyleesi sale → $431,500 total variable cash .
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LTI design and vesting:
- Time-based RSUs: 25% annual vest over 4 years .
- Performance RSUs: vest annually on corporate objectives including stock appreciation, program advancement, and licensing .
- Options: time-based options vest 25% annually; performance options vest on corporate objectives (stock appreciation, program milestones); exercise prices align with grant-date fair market value .
Equity Ownership & Alignment
| Ownership Metric | Amount |
|---|---|
| Total Beneficial Ownership (Common) | 1,931,322 shares; 4.0% of outstanding |
| Shares Outstanding (Record Date) | 46,479,861 |
| Breakdown (indicative) | Includes 181,818 shares underlying 200 shares of Series D Convertible Preferred Stock; 80,480 shares underlying outstanding options; 22,400 shares underlying RSUs, of which 6,400 are vested but deferred delivery |
| Stock Ownership Policy | NEOs met guidelines; reductions in share price or salary do not trigger recalculation unless holdings fall below threshold at Determination Date |
| Hedging/Pledging | Company prohibits hedging and pledging; management shares not pledged |
Insider Participation in Company Financing
- June 2025 securities purchase by officers/directors (including Wills): Series D Preferred (aggregate 3,400 shares, convertible at $0.11 into up to 3,090,908 common) and Series I Warrants to purchase up to 6,181,818 common at $0.11; exercisable upon stockholder approval; 5-year term post-approval . This insider participation at $0.11 suggests alignment but embeds potential dilution on future exercise .
Outstanding Equity Awards & Vesting (as of 6/30/2024)
| Grant Date | Exercisable Options (#) | Unexercisable Options (#) | Unearned Perf. Options (#) | Exercise Price ($) | Expiration |
|---|---|---|---|---|---|
| 06/20/2017 | 34,360 | — | — | 9.25 | 06/20/2027 |
| 06/16/2020 | 36,920 | — | — | 14.50 | 06/16/2030 |
| 06/16/2020 | 34,858 | — | — | 14.50 | 06/16/2030 |
| 06/22/2021 | 29,820 | 9,940 | — | 13.75 | 06/22/2031 |
| 06/22/2021 | 27,630 | — | 12,130 | 13.75 | 06/22/2031 |
| 06/22/2022 | 11,750 | 11,750 | — | 7.25 | 06/22/2032 |
| 06/22/2022 | 10,538 | — | 12,962 | 7.25 | 06/22/2032 |
| 06/20/2023 | 22,500 | 67,500 | — | 2.19 | 06/20/2033 |
| 06/20/2023 | 19,125 | — | 70,875 | 2.19 | 06/20/2033 |
| 06/04/2024 | — | 99,000 | — | 1.83 | 06/04/2034 |
| 06/04/2024 | — | — | 99,000 | 1.83 | 06/04/2034 |
| RSU Awards (Time-Based unless noted) | Not Vested (#) | Market Value ($) | Performance RSUs Not Vested (#) | Market/Payout Value ($) |
|---|---|---|---|---|
| 06/22/2021 | 6,090 | 11,875 | 4,992 | 9,734 |
| 06/22/2022 | 7,900 | 15,405 | 8,715 | 16,995 |
| 06/20/2023 | 43,125 | 48,094 | 45,282 | 88,300 |
| 06/04/2024 | 69,000 | 134,550 | 69,000 | 134,550 |
| Totals | 126,115 | 245,924 | 127,989 | 249,579 |
Vesting mechanics:
- Options granted on/after 2018: 25% per year over 4 years; pre-6/22/2021 grants fully vested; performance options vest per grant terms .
- RSUs: time-based 25% annually; performance RSUs vest on annual corporate objectives (stock appreciation, program advancement, licensing) .
Deferred delivery (selling pressure mitigant): certain vested RSUs include deferred delivery until separation or defined change-in-control; Wills has 6,400 vested RSUs not yet delivered under deferral provisions .
Employment Terms
| Term | Details |
|---|---|
| Contract Term | Effective 7/1/2022 through 6/30/2025, unless terminated earlier |
| Base Salary at inception | $650,000 (CFO/COO) |
| Annual Bonus | Discretionary, based on yearly performance objectives set by Comp Committee & Board |
| Severance – Death/Disability | Lump sum equal to 24 months of base pay; COBRA eligibility at employee cost |
| Severance – No CIC | If terminated without cause or resigns for good reason: lump sum salary then in effect + company-paid medical/dental for 2 years; all unvested options and RSUs accelerate; options exercisable up to 24 months or option expiry |
| Severance – After CIC | Within 1 year post-CIC, if terminated without cause or resigns for good reason: 200% of salary in lump sum + company-paid medical/dental for 2 years + up to $25,000 job search fees; all unvested options vest and are exercisable up to 24 months or expiry; all unvested RSUs vest upon change in control |
| Equity Acceleration Features | Employment agreements describe double-trigger acceleration for options (termination within 12 months post-CIC) and RSUs vest upon CIC; Company highlights double-trigger policy for NEO equity in its compensation practices |
| Restrictive Covenants | Non-compete, non-solicitation, confidentiality included in agreements |
| Clawback | Compensation recovery policy for material noncompliance with financial reporting; available on company website |
| Anti-Hedging/Pledging | Employees, directors, officers may not hedge or pledge Company securities |
Compensation Peer Group (Benchmarking)
Peer group used by Aon Rewards for NEO awards (June 2023): AcelRx Pharmaceuticals; AIM ImmunoTech; Aldeyra Therapeutics; Aptevo Therapeutics; Athersys; Clearside Biomedical; Cumberland Pharmaceuticals; Eton Pharmaceuticals; Kala Pharmaceuticals; Kezar Life Sciences; MEI Pharma; MeiraGTx Holdings plc; Paratek Pharmaceuticals; Savara; Verastem .
Say-on-Pay & Shareholder Feedback
- 2024 Say-on-Pay support ~58% of votes cast; Company increased disclosure and added performance-based equity to at least half of LTI; adopted clawback; removed tax gross-ups; maintained independent compensation committee and anti-hedging policy .
Investment Implications
- Alignment: Wills’ participation in June 2025 insider financing (Series D Preferred and Series I Warrants at $0.11) signals insider confidence at low price levels but adds dilution risk upon exercise; warrants require stockholder approval and have 5-year terms .
- Near-term selling pressure: Significant scheduled vesting in time-based RSUs (2021–2024 grants) and performance RSUs could create supply; however, deferred delivery provisions on some vested RSUs reduce immediate selling pressure .
- Pay-for-performance: Annual cash payout calibrated to 85% corporate achievement with an additional transaction bonus tied to the Vyleesi divestiture, indicating linkage to operational execution amid a backdrop of declining revenue and widening losses in FY 2024 .
- Retention risk: Robust severance (2x salary; 200% post-CIC) and full equity acceleration upon CIC for RSUs, plus strong ownership policy compliance and anti-hedging/pledging constraints, support retention and alignment; double-trigger mechanics on options moderate windfalls without termination .