Why Are Small Biotech Companies Greatly In Need Of Relief?
As noted in a previous paragraph, many publicly held biotech companies are marginally profitable or unprofitable. Unlike other small companies, they are subject to litigation over patent infringement, licensing disputes, patent trolls, etc. They must assert in their filings their awareness of any material contingencies or material impairments of their patent portfolios. As auditors, we ask to speak to in-house counsel, external counsel and patent counsel as to whether they are aware of any potential contingencies or potential claims against the company’s intellectual property. If such is the case, there has to be disclosure in their public filings, even if the company is aware of a risk. This is also true in the case of a license impairment, which would have a material effect upon the company’s business. While it is my opinion that the stock markets have not reacted punitively when a small tech company has a material weakness statement regarding its internal controls, such is not the c
