21 May, 2013
Practice Group(s):
Life Sciences
Capital Markets
ASX Issues "Code of Best Practice" for
Reporting by Life Science Companies
By Andrew Gaffney
The Australian Securities Exchange (ASX), after extensive industry consultation has just issued a
revised "Code of Best Practice" for Reporting by Life Science Companies (Code).
While adoption of the new Code is not mandatory, it provides a very useful tool for listed life
sciences companies to discharge their continuous disclosure obligations under the ASX Listing
Rules (which have the force of law pursuant to the Corporations Act).
Importantly, those disclosure obligations under the ASX Listing Rules have not changed, but the
Code assists in providing guidance as to how listed life science companies should comply with
their continuous disclosure obligations.
The Code aims to incorporate international best practice in reporting – to maintain and enhance
the reputation and standing of Australian listed life science companies internationally. The Code
addresses the complexities of this industry with the adoption of appropriate standardised
terminology and context for disclosure to investors and the market. This guidance on industry
specific disclosure is not unusual and reflects the ASX's approach to publishing (with effect from
1 January 2013) new reporting requirements for listed resource companies.
It should lead to greater uniformity in disclosure by life science companies and assist the market in
assessing those disclosures. The recommended disclosures range from R&D, clinical trials,
regulatory and reimbursement matters, IP and statutory exclusivity rights, licensing,
manufacturing, key staff, periodic reporting of activities and financial reporting – with useful
guidance for biotech, agricultural and medical device companies.
Failure to adopt the Code in terms of disclosure may lead to regulatory questions as to whether the
relevant life science company has discharged its continuous disclosure obligations and also
whether its market disclosures/announcement are accurate and not misleading.
While not mandatory, it is a must read for all life science companies and sets a new bar in terms of
disclosure standards.
Authors:
Andrew Gaffney
andrew.gaffney@klgates.com
+61.3.9640.4329
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ASX Issues "Code of Best Practice" for Reporting by
Life Science Companies
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