The Return Of Biotech IPOs

Biotech IPO market activity has recently returned to levels not seen since before the financial crisis. This has been brought about in part by the accommodations afforded issuers under the Jumpstart Our Business Startup Act ("JOBS Act"). Under the JOBS Act, issuers that qualify as "emerging growth companies" ("EGCs") can take advantage of a number of IPO on-ramp accommodations, including (1) confidential SEC staff review of draft IPO registration statements, (2) scaled disclosure requirements (e.g., only two years of audited financial information (rather than three years) and reduced disclosure requirements for executive compensation), (3) an extended transition period to comply with new or revised accounting standards, (4) no restrictions on testing-the-waters communications with qualified institutional buyers and institutional accredited investors before and after filing a registration statement, and (5) an exemption from the requirements under Sarbanes-Oxley Act