SEC and FDA Sign Three-Year Data-Sharing Pact to Tighten Market Oversight

To support the sharing of nonpublic information about regulated products and possible violations of law, the SEC and FDA signed a three-year memorandum of understanding.

The memorandum of understanding took effect Aug. 31 and supports the agencies in exercising their existing oversight authority, but does not signal a new disclosure rule, investigation or enforcement action.

The agreement also allowed the Securities and Exchange Commission to use information submitted to the FDA in filing reviews, investigations, proceedings and civil actions and allowed the regulators to compare information disclosed to investors with information filed to the FDA.

Announcements of clinical trial results, FDA submission, regulatory review, and product approval for public biotech, pharmaceutical, medical-device and healthcare companies can cause share prices to go up or down based on commercial opportunity.

The MOU covers statements from the FDA, including the reviews, approval, and results of clinical trials. SEC Chairman Paul Atkins has said that FDA disclosures can materially affect markets. Acting FDA Commissioner Kyle Diamantas said the quicker exchanges should improve transparency in the life sciences and help protect patients’ and the public’s trust.