The Securities and Exchange Commission and Food and Drug Administration signed a three-year cooperation agreement on August 31 that establishes formal channels for exchanging nonpublic information about regulated products, public companies, and potential legal violations. According to reports from the SEC, the agreement creates structured procedures for information sharing that takes effect immediately and does not announce any new investigations or enforcement cases. The MOU specifically allows the SEC to use FDA information during company filing reviews, enforcement investigations, administrative proceedings, and civil actions. SEC Chairman Paul S. Atkins emphasized that disclosures related to the FDA by public companies have a significant effect on U.S. markets, stating that the FDA is an important partner in administering and enforcing applicable disclosure requirements under federal securities laws.
The agreement addresses a critical coordination gap where public biotechnology, pharmaceutical, medical device and healthcare companies frequently release information about clinical trials, FDA submissions, regulatory reviews and product approvals that can significantly impact stock prices. As reported by the SEC, better coordination between the agencies is expected to help the SEC identify inconsistencies between corporate disclosures and regulatory records. The MOU specifically mentions representations about FDA reviews, product approvals and clinical trial results, with both agencies stating their cooperation is designed to bolster informed decision-making and improve oversight. The new agreement sets a three-year framework for information sharing and joint support on oversight and compliance across the life sciences sector, with the arrangement intended to improve market oversight and compliance where FDA-related developments intersect with federal securities law obligations.
Both agencies have established comprehensive confidentiality safeguards for shared nonpublic records. According to the agreement, each agency will appoint designated contacts from specific divisions - the SEC will appoint from its Division of Enforcement and Division of Corporation Finance, while the FDA will appoint from its Office of the Chief Counsel and Office of Inspections and Investigations. The FDA chief counsel's office will lead referrals involving potential securities violations. Shared information remains confidential and generally requires written permission before any external disclosure, with the SEC unable to provide FDA information to outside parties without written FDA permission. The MOU increases scrutiny on how companies report FDA-linked developments that can influence valuations, trading activity and investor confidence in the life sciences sector.
The MOU does not provide either regulator with new statutory powers but organizes existing authority and establishes designated contacts to reduce information delays. As reported by the SEC, the agreement may be extended or modified through mutual written consent, with either agency able to terminate it by providing 30 days' advance notice during the three-year operating period. The document represents the agencies' intentions and does not create legally enforceable obligations, with implementation subject to available staff, funding and other resources. The agreement expires in August 2029 unless extended, with the arrangement underscoring closer scrutiny of how companies communicate FDA-linked developments that can influence market integrity and public health.
