BDO Life Sciences Letter - Spring 2017

April 2017

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In the Spring 2017 Life Sciences Letter, we explore topics including the evolution of the Priority Review Voucher program, and how evolving healthcare reform and international tax changes are forcing life sciences entities to rethink business models and global IP holding structures. 
 


Why U.S. Life Science Companies Need to Rethink Global IP Holding Structures

The recent tax updates issued by the OECD and Federal Accounting Standards Board will require U.S. life sciences companies to rethink their current tax planning initiatives, global intellectual property (IP) holding structures and financial reporting methodology. And the looming possibility of U.S. tax reform poses additional questions and challenges for life sciences companies.
   


Why Priority Review Vouchers Provide Pharma a Starting Point Worth Building Upon


BDO Talks with David B. Ridley About Hopes for the Program's Future

The Priority Review Vouchers (PRVs) program, created by the FDA to encourage the treatment of infectious, parasitic and rare pediatric diseases, has long been seen by companies as a way to expedite the FDA approvals process. Only four of the 13 PRVs, however, have been redeemed since the program's implementation. This begs the question—how truly effective is this program in accomplishing its goals? Duke Professor David B. Ridley, whose paper had helped form the basis for the program, explores the PRVs program's strengths, weaknesses and opportunities.
   


What Washington Insiders Are Saying About Healthcare Reform Under Trump

Scott Gottlieb Joins BDO to Talk Industry Trends

BDO's Healthcare practice recently hosted a breakfast panel, "Healthcare Reform: Insights from Inside the Beltway," during the 2017 J.P. Morgan Healthcare Conference. The panel, which featured Dr. Scott Gottlieb, FDA commissioner nominee and former BDO Senior Fellow, Dave Tamasi of Rasky Partners, and BDO's Dr. David Friend and Patrick Pilch, featured topics ranging from alternative payment models and their implications for the business of health, to the future of healthcare reform, new drugs and reimbursement risk.
   


How Innovations, Payment Models Seek to Tie Drug Pricing to Patient Outcomes

Healthcare industry stakeholders are exploring new innovations and pricing models to evaluate the cost and efficacy of drugs and establish better ways of tracking patient outcomes. BDO's Bill Bithoney recently sat down with HFMA's CFO Forum for a Q&A on trending solutions to understand a drug's efficacy across large patient populations.
   


How Business Combinations Impact Accounting in Life Sciences

In January 2017, the Financial Accounting Standards Board released an update that clarified the definition of a business in "Topic 805, Business Combinations." The update has significant implications for the life sciences industry, which has long depended on business collaboration agreements to share resources and spearhead the development of medical breakthroughs. Life sciences companies should familiarize themselves with the new definition now to prepare for the future.
   


When it Comes to New Revenue Recognition Model, ASC 606, It's Time to Play Ball!

The new FASB-issued Accounting Standard Update (ASU) 2014-09: Topic 606, Revenue from Contracts with Customers establishes comprehensive accounting guidance for revenue recognition. Life sciences companies will experience varying degrees of impact based on the nature and stage of each business. To prepare, each company should conduct an in-depth analysis of all related agreements.
   

For more information, please contact:

Todd Berry
Partner - Life Sciences, National Leader
617-239-4125 / tberry@bdo.com

Eric Sobota
National Leader - Life Sciences
703-893-0600 / esobota@bdo.com