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Biostage CEO Jim McGorry
June 15, 2020
Biostage CEO resigns, receives six-months severance pay
James McGorry resigned as CEO of Holliston biotechnology company Biostage, Inc., officially leaving his position on Feb. 7, according to a company quarterly earnings report released in May.
Under the separation agreement, McGorry will be paid $187,500 severance pay, which equals six months of his base salary at Biostage. He was given the opportunity to purchase 80,000 shares of common stock of the company.
It was not immediately clear why McGorry resigned, although the company said in its earnings statement it planned to search for his replacement. No CEO is currently listed on the company’s website, and President Hong Yu is listed as the top-ranking executive. Yu joined Biostage in 2018.
McGorry led BIostage through a tough few years as it struggled financially while trying to bring its esophageal implant to market. In 2017, after finances began drying up as its research continued before the product came to market, the company was delisted from the Nasdaq and laid off 71% of its workforce. Biostage appeared to be headed for financially insolvency before China-based DST Capital LLC invested $4 million in the company and the Connecticut Children’s Medical Center invested another $100,000.
After the $4-million investment, DST Capital began to exert greater influence over the company, including adding new members to Biostage's board of directors, including Chairman Jason Chen.
DST invested in Biostage because the Holliston's company's main product, which seeks to regrow the esophagus in patients' throats, is seen as important in the Chinese market because of the higher rates of cancer in China due to higher smoking rates.
Biostage did not immediately return requests for comment regarding McGorry's departure.
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