MichBio Applauds the Fostering Innovation Act, A Bipartisan Bill Offering Continued Support to Emerging Bio Industry Companies

ANN ARBOR, Mich.–(BUSINESS WIRE)–lt;a href=”https://twitter.com/hashtag/BiosciencePolicy?src=hash” target=”_blank”gt;#BiosciencePolicylt;/agt;–The Michigan Bioscience Industry Association, MichBio, along with
organizations around the country, supports the recently introduced
Fostering Innovation Act.

The Act introduced by Sens. Gary Peters (D-MI), Thom Tillis (R-NC),
David Perdue (R-GA), and Kyrsten Sinema (D-AZ) would build on the
success of the JOBS Act by extending the exemption from Sarbanes-Oxley
Section 404(b) for an additional five years for pre-revenue biotech
companies.

“Essentially the Act will allow biotech companies without an FDA
approved product on the market—i.e. those still in the R&D phase of
business development—to avoid the costly compliance related disclosures
required of established organizations,” says Stephen Rapundalo, Ph.D,
President and CEO of MichBio. “It is vitally important that the emerging
biotech companies formerly afforded scaled disclosure under the JOBS Act
are able to continue to devote their precious capital toward science
rather than compliance.”

According to the Biotechnology Innovation Organization, BIO, More than
300 biotech companies have gone public since passage of the JOBS Act in
2012—a 270 percent increase over the same period prior to its enactment.

“As helpful as the five-year exemption was, biotech startups operate on
a different timeline than most other industries. On average, innovative
biotech companies spend 10-15 years in the lab or clinic developing
potentially life-saving medical advances before their first therapy is
approved by the FDA and put on the market,” continued Rapundalo, “This
long period in pre-revenue operations makes the protections offered in
the Fostering Innovation Act essential to continued growth in the
biotech industry.”

“We thank Sen. Peters for his continued support of Michigan’s
biosciences industry. We applaud him and the other bill sponsors for
their leadership and encourage the Senate to advance this legislation to
ensure emerging biotech companies can continue to invest significantly
in research and development to discover life-saving medicines.”

Without these protections, emerging biotech companies would spend
upwards of $1 million per year on the 404(b) audit and other financial
disclosure obligations that do not benefit their investors. Advancing
this legislation will enhance capital formation and spur scientific
advancement across the country for the benefit of biotech investors and
patients alike.

For more information on MichBio visit www.michbio.org.

Michigan Biosciences Industry Association (MichBio) is the recognized
voice as well as the foremost source of information, advocacy and
resources in Michigan for the biosciences industry.

Contacts

Stephen Rapundalo, Ph.D.
President and CEO, MichBio
734-527-9144

Alisha Brown
Director of Marketing and Communications, MichBio
734-527-9147

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