What adverse events have to be disclosed to investors?

Icarus Consultants is a marketing strategy consulting company to biotechnology, pharmaceutical and life science companies. We don’t offer marketing communications services.

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However, we like to keep our finger on the pulse of the market, so read with interest the recent United States Supreme Court decision in Matrixx Initiatives, Inc. v. Siracusano that involved a failure of Matrixx to share adverse event information with investors.

You may recall the issue of loss of smell associated with use of Zicam Cold Remedy Nasal Gel that contained zinc sulfate.

Matrixx argued that only statistically significant adverse events are material and need to be disclosed to investors, a position the Supreme Court disagreed with.  In general terms, the Court held that adverse events that may be linked to a product that could impact a reasonable investor’s decision making need to be disclosed.

What’s the impact of this decision?  The Matrixx decision will require companies and their PR agencies to think carefully about the need to include negative information as well as positive when making press releases. Clinical teams will need to talk to investor relations and marketing, something that may be a challenge in the silos of big pharma.

You can read more about this case, and a more in-depth analysis of Justice Sotomayor’s Supreme Court opinion on Biotech Strategy Blog.

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