The Financial Supervisory Service is pushing to significantly toughen pre-listing disclosure standards for bio corporations. The need to protect investors has grown as cases mount in which the gap widens sharply between performance estimates presented during the listing process and actual results.
On the 12th, according to the financial authorities, the Financial Supervisory Service (FSS) recently launched a task force (TF) on improving bio corporation disclosure guidelines and held its first meeting. The meeting reportedly included internal FSS officials as well as outside experts such as securities firm bio-sector analysts and market specialists.
The Financial Supervisory Service (FSS) plans to fully revise the disclosure guidelines for bio corporations. It intends to overhaul disclosures, including securities registration statements, to protect investors and provide accurate, easy-to-understand information on bio corporations to support reasonable investment decisions.
First, it will revise the format starting with the securities registration statement submitted during the listing review. Accordingly, going forward, the securities registration statement—submitted by corporations to make investment offers to investors—will include the main assumptions underpinning the public offering price calculation and projections of future revenue.
Specifically, it is reviewing revising the format to reasonably estimate the key assumptions that affect performance, such as ▲ objectivity in assessing market size ▲ likelihood of clinical trial success ▲ regulatory approval uncertainty ▲ potential delays in development timelines.
In regular and ad hoc disclosures, it plans to include items such as key management contracts, supplementation of research and development activity formats, and refinements to the comprehensive disclosure guidelines for pharmaceutical and bio corporations.
The Financial Supervisory Service (FSS) plans to operate the TF through June and then announce the revised disclosure guidelines based on the results.