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Faber Attorney Leads BIO Contracts Course

Focus Is on Real World Dynamics

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Mark J. Cooper, Of Counsel with Faber Daeufer & Itrato, recently co-taught the “Contract Basics” segment of BIO’s Business Development Fundamentals course, held during the trade association’s June 17-19 conference in San Diego.  He collaborated with Pauline Jen Ryan, of Red Sky Partners, on the four-hour workshop, which offered real world perspectives on how to structure and negotiate life science business deals.

Seventy-six professionals, representing biotech startups, mid-size biotechs, Big Pharma and academia, heard practical advice about the key agreement concepts to focus on, based on the instructors’ extensive negotiating backgrounds.  The wide-ranging, four-hour session covered:

  • confidential disclosure agreements (CDAs)
  • materials transfer agreements (MTAs)
  • evaluation agreements
  • sponsored research agreements
  • M&A agreements
  • licensing
  • collaborative research
  • co-development and co-promotion agreements
  • innovative structured transactions

“Participants told us that they appreciated learning how typical bargaining plays out in real life, rather than focusing on arcane legal detail,” says Mark. “We spent a lot of time talking about how Big Pharma and biotech startups approach deals differently, and we peppered our talk with anecdotes from our own experiences.

“Many questions early in the session were focused on the CDA, such as the length of confidentiality, treatment of trade secrets, orally disclosed information and choice of law,” Mark continues.  “We tried to emphasize that while the CDA is important, and is often the first and most common preliminary agreement entered into as part of a definitive transaction, each side spends inordinate amounts of time on the precise language of a CDA.  Too little time is spent considering the fundamental questions of whether two parties should enter into a CDA in the first place, and what is to be considered confidential.”

Fully half of the highly interactive workshop was devoted to licensing and included a “David and Goliath” case study that highlighted common industry issues. The scenario featured a small biotech with early stage technology and a large pharmaceutical firm with the resources needed to bring it to market.  Discussion ranged across scope of licensing, appropriate diligence, governance, dispute resolution, fees and termination.  

“As in any deal, each party to a life science transaction will naturally bargain and seek to use whatever leverage it has,” observes Mark. “However, the parties also need to realize that a license and collaboration marks the beginning of a long-term relationship. Successful partners also consider as key to their business interests how to optimally advance science, and what is in the best interests of patients. Unlike an M&A deal, where the document will sit on a shelf after the deal closes, a life sciences collaboration agreement is a living document that helps guide a long-term relationship between two companies.  This requires parties to be reasonable, practical and creative in negotiation. One of the most value-add and satisfying activities of lawyers and business development professionals is to take seemingly intractable issues that appear to be zero sum and work with both parties to reach win-win solutions.”

Mark has over 25 years of experience advising, structuring, drafting and negotiating complex transactions. Prior to joining Faber, he served as inhouse counsel for Pfizer for over 17 years, most recently as Vice President, Business Transactions, R&D.

Faber Daeufer & Itrato PC provides the materials on this website for general informational purposes only, and does not intend for these materials to be a source of legal advice for any purpose. The firm disclaims all liability for any actions taken or not taken based on these materials. Actions should not be taken or not taken until you establish an attorney-client relationship with a lawyer licensed in your own state or country and obtain advice from that lawyer. Your use of this website and receipt of materials on this website does not establish an attorney-client relationship between you and the firm.

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