Compliance With FDA And SEC Disclosure Requirements For Medical Device Makers: Standard Operating Procedures Can Help

In 2004, the U.S. Securities and Exchange Commission (SEC) and the U.S. Food and Drug Administration (FDA) announced steps to enhance cooperation between them in order to further protect the investing public from false and misleading statements by public life sciences companies. Given the relationship between the SEC and the FDA, the consistent flow of information between life sciences companies and the FDA, and the frequency with which many such companies utilize the public markets to raise funds, companies in this area are well-advised to establish a robust set of disclosure policies and procedures to ensure that information is being promptly and accurately disclosed.

Although there is no general affirmative duty for a public company to disclose non-public information, SEC rules and regulations may require disclosure of certain information or life sciences companies may voluntarily disclose information. Whenever a disclosure is made, however, it must be complete and accurate to avoid misleading the public. Because of the importance of disclosing accurate information, even small public life sciences companies need to focus on making sure information flows accurately and promptly within the company and then to the public.

One approach is to develop and utilize standard operating procedures that encourage timely and accurate exchange of information. For example, a formal written standard operating procedure (SOP) for dealing with communications from the FDA can help a company identify and disclose pertinent information and may include the following guidelines:

Written communication with the FDA should be circulated within 24 hours to members of regulatory affairs, clinical trials/development divisions, the general counsel's office, and corporate communications

Oral communications should be documented in a written summary and circulated to the same group of people

Specific personnel should be responsible for drafting and distributing these communications, and there should be a procedure for calling meetings on short notice to allow for discussion about the new information throughout the company

Creating SOPs for the drafting, review, and filing of SEC filings also is an important component for disclosure policies and procedures. For each periodic filing on Form 10-K or 10-Q...