TheCorporateCounsel.net

If you work with life sciences companies, you know that clinical data developments and releases do not always fit neatly into SEC disclosure and fundraising rules. Two recent Fenwick memos give must-read roadmaps on these topics. Here are a couple of disclosure considerations (also read this fundraising / IR piece):

What if data are expected around the time of a Form 10-K or Form 10-Q filing or a planned investor meeting?

If the company has undisclosed topline clinical data when filing an Annual Report on Form 10-K or a Quarterly Report on Form 10-Q, it generally must disclose those data in the filing.

To avoid issues, you can either advance the Form 10-Q filing to a date before the company receives the data or delay the data receipt until after the scheduled filing.

Once the CEO or any other key executives who regularly engage with investors are aware of the data, they should stop all discussions with investors prior to disclosure.

Does the four business day reporting deadline for Form 8-K apply to topline clinical data releases?

No. A span of six to seven days from the point of receiving the data to public release is typical, however, more rapid disclosure may be necessary with negative results. Additionally, there may be other important timing considerations if the data are expected to support a financing for the company. A proactive legal strategy includes early discussion of the preferred release time with your investor relations team.

The memo also covers special blackouts, conference presentations, and more. Given these complexities, it’s smart to think ahead. The Fenwick team outlines how to prepare in advance:

When should I start preparing for disclosure?

Preparations can often begin several months in advance. Once a calendar is set for planned readout dates, establish a strong communication channel with the clinical team working on the trial readout, your investor relations team and your legal team. Make sure that you understand the basics—the trial structure, when the data are planned to arrive, and what data are anticipated. This will help you evaluate regulatory risks and necessary disclosures while setting expectations for the internal and external flow of information. Having a communications plan in place early can also be helpful if it becomes necessary to disclose data early (e.g., if there is a safety signal necessitating early unblinding or trial termination).

What can I prepare in advance?

It can help to develop a detailed day-by-day task plan. This plan should include proposed tasks from the moment the data arrives at the company for processing and reviewing, right up to the date of disclosure, and even beyond. This approach also helps solidify your position as a crucial participant in decisions about data timing and provides structure for the internal dissemination of data during the pre-public release phase.

Collaborate with the cross-functional team responsible for managing the data release to create core forms of press releases, corporate presentation slides and other supplementary items, such as a preliminary Q&A.

Establishing a structured timeline can be instrumental in ensuring everyone is aligned on key disclosure dates, the availability of key stakeholders, and assessing potential training needs in advance of receiving data.

– Liz Dunshee