Add to Calendar 4/9/2019 8:00:00 AM 4/9/2019 10:00:00 AM Cross-Border Biotech Transactions: CFIUS and Other Risks For early-stage research companies seeking equity capital or pursuing strategic alliances with foreign partners or investors, there are considerable risks to consider when conducting these transactions, whether on U.S. soil or in foreign lands. Nonetheless, despite cumbersome impediments, more U.S. biotech and medical device companies are pursuing these alliances or investments, believing that the risks are outweighed by the benefits. Of particular note, in recent years Chinese and other Asian investors have invested record amounts of money into U.S.-based biotechnology firms. Furthermore, the equity investment arms of European Pharma companies are also heavily investing in U.S. biotech companies, as they have accomplished for many years. All of these investment and partnering pursuits are now in trouble, due to recent U.S. government pronouncements, in particular, the new CFIUS proclamations. On November 10 2018, the Committee on Foreign Investment in the United States (“CFIUS”) expanded its regulation of cross-border transactions with several adverse announcements, regulations which may impede the flow of foreign capital into U.S. biotech companies, hinder strategic partnering opportunities, and prohibit acquisitions of U.S. biotech companies -- even if the U.S. company is never leaving the homeland. The life science and biotech industry sectors falls under CFIUS’s list of “27 critical industries” that require expanded – and protracted -- review of foreign investments, strategic partnerships with foreign Pharma partners, and acquisitions involving foreign acquirers. Whether engaging in collaboration arrangements, joint ventures, investments or acquisitions involving foreign players, management of biotech companies need to learn the newest set of roadblocks, snafus and hurdles that they should carefully consider as a consequence of the new CFIUS regulations. MassBio, 300 Technology Square 8th Fl, Cambridge, MA 02139
For early-stage research companies seeking equity capital or pursuing strategic alliances with foreign partners or investors, there are considerable risks to consider when conducting these transactions, whether on U.S. soil or in foreign lands. Nonetheless, despite cumbersome impediments, more U.S. biotech and medical device companies are pursuing these alliances or investments, believing that the risks are outweighed by the benefits. Of particular note, in recent years Chinese and other Asian investors have invested record amounts of money into U.S.-based biotechnology firms. Furthermore, the equity investment arms of European Pharma companies are also heavily investing in U.S. biotech companies, as they have accomplished for many years. All of these investment and partnering pursuits are now in trouble, due to recent U.S. government pronouncements, in particular, the new CFIUS proclamations. On November 10 2018, the Committee on Foreign Investment in the United States (“CFIUS”) expanded its regulation of cross-border transactions with several adverse announcements, regulations which may impede the flow of foreign capital into U.S. biotech companies, hinder strategic partnering opportunities, and prohibit acquisitions of U.S. biotech companies -- even if the U.S. company is never leaving the homeland. The life science and biotech industry sectors falls under CFIUS’s list of “27 critical industries” that require expanded – and protracted -- review of foreign investments, strategic partnerships with foreign Pharma partners, and acquisitions involving foreign acquirers. Whether engaging in collaboration arrangements, joint ventures, investments or acquisitions involving foreign players, management of biotech companies need to learn the newest set of roadblocks, snafus and hurdles that they should carefully consider as a consequence of the new CFIUS regulations.
Director of the Center for Clinical Spectroscopy, Brigham and Women’s Hospital
Alexander P. Lin, PhD is the Director of the Center for Clinical Spectroscopy in the department of radiology at Brigham and Women’s Hospital and Assistant Professor of Radiology at Harvard Medical School. Dr. Lin is a graduate of the California Institute of Technology, where he completed his Masters degree in Bioengineering and his doctoral degree in Biochemistry and Molecular Biophysics. Dr. Lin commenced at Brigham and Women’s Hospital in 2009 where his research has focused on translating magnetic resonance spectroscopy technology into clinical practice in areas such as traumatic brain injury, cancer, metabolic disorders, Alzheimer’s disease, psychiatric disorders, and many others. In 2016, with the support of the BWH iHub, he co-founded BrainSpec, Inc. a multi-million dollar software platform that enables efficient, accurate, and non-invasive diagnosis of brain disorders by measuring brain chemistry. The company was the 2017 Google Cloud Machine Learning Startup Competition Winner, 2016 Tufts New Venture winner and Harvard finalist as well as a part of MassBio, TechStars, and Philips Healthworks.