Torys Reicin by jolinmilioncherie


									Page 16                                                                  The Metropolitan Corporate Counsel                                                             November 2006

A Life Sciences Practice That Leads The Discussion
The Editor interviews Cheryl V. Reicin,                                                         changed as well. There was a time when           Editor: In 2004 the life sciences sector
Partner, Torys, LLP.                                                                            we advised our clients not to go public         began to attract substantial investment
                                                                                                too early if they wished to receive venture     as a consequence of renewed interest
Editor: Ms. Reicin, we last spoke in
                                                                                                capital support. Today many venture cap-        from venture capital firms, pharma-
September of 2004. Would you tell us
                                                                                                italists have become favorably disposed         ceutical houses and individual
something about the evolution of
                                                                                                to doing PIPE transactions – a PIPE trans-      investors. What prompted this inter-
Torys’ life sciences practice during the
                                                                                                action is a private investment in a public      est?
past two years?
                                                                                                company – whereby a venture capitalist
                                                                                                can obtain liquidity in the public market.      Reicin: The signal has been around for a
Reicin: The life sciences practice has
                                                                                                The venture capitalist does a private           while: the large baby boomer generation
grown dramatically. We have expanded in                                                         placement and thereafter the shares are         is aging, and boomers are demanding
all the disciplines that are specific to the                                                     registered and may be traded publicly.          innovation to extend their lives and enjoy
life sciences industry. That includes                                                           Venture capitalists are also advocating         a quality of life. This generation has a
financing and mergers and acquisitions                                                           reverse mergers into public companies.          strong desire for health technology and
for life sciences companies, corporate and                                                      They are looking for liquidity.                 possesses the means to pay for new prod-
tax structuring for these companies, IP, IP                                                                                                     ucts. When the tech boom came to a halt
litigation, licensing and regulatory. As we                                                     Editor: How about acquisitions and              in 2000-2001 many investors lost money,
have grown, we have sought out the best                                                         mergers?                                        and that put a temporary damper on
attorneys we can find in each of these                                                                                                           investment in technology. That is over
areas who have deep industry experience.                                                        Reicin: At present this is a hot area. Over     now. Investors know that life sciences is a
Most of the professionals in our group are                   Cheryl V. Reicin
                                                                                                the last few years it has been difficult for     growing industry, and they also know that
full-time life sciences practitioners, but                                                      many life science companies to go public        the big pharmaceutical companies are
we do have another group of attorneys            strategize with our clients about where to
                                                 find financing, where to conduct clinical        the traditional way. Last year there were       looking for product.
who spend part of their time in life sci-                                                       only 17 biotech IPOs in total in the
ences and the balance in general technol-        trials, the best site for manufacturing, the
                                                                                                United States, and we were involved in          Editor: You have commented on
ogy.                                             best location for a CEO and most benefi-
                                                                                                two of them. There are two reasons for          Ontario’s adoption of U.S.-style disclo-
                                                 cial corporate and tax jurisdiction. Every
                                                                                                this state of affairs. First, the large phar-   sure liability laws. What impact is this
Editor: What kind of background and              biotech enterprise, whether located in
                                                                                                maceutical companies need product.              having on Canadian companies?
education do your practitioners have?            Boston, San Diego, Toronto or Israel,
                                                                                                Many of their own drugs are now going
                                                 must think like a global company.
                                                                                                off patent and these companies are will-        Reicin: Companies are gearing up to
Reicin: There is considerable variation.                                                        ing to buy a biotech company at an earlier      comply and to make sure that they dis-
Our IP practitioners have science back-          Editor: I gather that your clients may
                                                                                                stage of its development than the pharmas       close in a way that resembles the disclo-
grounds, and a number have master’s              have a base in Toronto, but that they
                                                                                                would have in the past. Consequently, a         sure required in the United States.
degrees and Ph.D.s. Many of our corpo-           might come from anywhere.
                                                                                                young life sciences enterprise that would       However, I suspect that the level of dis-
rate lawyers have science backgrounds as                                                        have gone through several rounds of             closure for companies public only in
well, but we also have attorneys with            Reicin: A substantial part of my practice
                                                                                                financing and then been ready for a pub-         Canada will still lag. Only once a strong
MBAs and prior industry experience. The          is with U.S. and Israeli biotech and med-      lic offering is acquired before reaching        plaintiff bar infiltrates Canada, will com-
group has a practical business orientation,      ical device companies and companies in         that stage. Second, markets are much            panies get really serious about disclosure.
so the MBA component has been particu-           other cities in Canada, as well as with        more discriminating. The chances of a life      Plaintiffs’ law firms are beginning to set
larly helpful.                                   investment banks and venture capitalists       sciences company succeeding are slim,           up shop and get focused in Canada as we
                                                 located worldwide. We also do a large          and investors are becoming more rational        speak.
Editor: Would you characterize the               portion of our work for the big pharma-        in their investment decisions. In fact,
group as having a southbound prac-               ceutical companies. Ours is truly a global     most of the money that has been made by         Editor: Your comments on stem cell
tice?                                            practice.                                      investors in the biotech public markets         research have also received media
                                                     When Torys set up its New York office       has been the result of “shorting” these         attention. For starters, why is Canada
Reicin: I joined Torys to continue to con-       it did so with the intention of establishing   stocks – in other words betting against the     – and Toronto in particular – so well
duct a U.S. practice and to serve a grow-        a full-service office, as opposed to a small    company’s success.                              placed to meet this particular chal-
ing demand for a strong southbound               representative office. I think that brands                                                      lenge?
practice (Canada into the United States).        the firm to a certain extent, and it also       Editor: And worldwide licensing?
There is a need for a southbound practice        reflects the fact that many of the firm’s                                                        Reicin: Canada does not have the degree
because of the considerable number of            clients are playing in the global arena. At    Reicin: We represent more large pharma-         of regulation that prevails in the United
biotech companies in Canada and the dif-         least half of our life science clients have    ceutical companies than any law firm in          States. In Canada, there is more freedom
ficulty of obtaining local funding. Let me        no Canadian connection whatsoever.             North America, and we handle a great            to do stem cell research, and the volume
qualify that by saying that funding in                                                          deal of worldwide licensing work both to        of work in this area is increasing.
Canada may be difficult, but it is not            Editor: A practitioner in this area has        and from big pharma. Traditionally, big            I believe that stem cell research will
impossible. In any event, biotech compa-         to cover a pretty wide area. Would you         pharma have handled their legal work            go forward. We are hopeful that this sci-
nies have an unquenchable need for fund-         share with us some of the dimensions of        in-house. However, the deals have               ence can be helpful in curbing diabetes,
ing and need to access both U.S. and             such a practice?                               become larger and more complicated, and         and we know it can be used to treat neu-
Canadian funding sources.                                                                       companies are increasingly sending their        rological diseases. So long as there are
    In addition, if a life sciences company      Reicin: As a corporate attorney, I oversee     sophisticated licensing transactions to the     patient populations that need the results
is going to be successful, it must be able       a great deal of activity – aside from patent   few firms with the expertise to handle           of this research, the dedicated scientists
to enter the U.S. market for the distribu-       prosecution, which is handled by a sepa-       them. We are getting a greater volume of        who work in this area will find a way to
tion of its products. Canadian and other         rate department; this activity includes        this work.                                      meet the ethical and political issues. Just
non-U.S. companies, accordingly, must            company formation, venture capital                                                             recently a company in Massachusetts
have a U.S. mindset. At Torys, we are for-       financing, public offerings, strategic part-    Editor: Litigation is also an important         announced that it knew how to use
tunate to have had tax lawyers on both           nerships, acquisitions and mergers, and        aspect of the life sciences industry.           embryonic stem cells without destroying
sides of the border. This has permitted us       licensing. I hasten to add, we work                                                            the embryo. That is good news for every-
to come up with interesting structures to        closely with our patent prosecution col-       Reicin: There is a saying that if you are       one and, perhaps, a reflection that this
make the financing of Canadian compa-             leagues. It is often important for patents     not being sued on your patents, it proba-       movement cannot be stopped.
nies more attractive. In light of the            to be broken down in order to make the         bly means your IP is not worth much. We
tremendous need for financing in this             most effective licensing techniques avail-     have a group of litigators who specialize       Editor: Where would you like this
area, a law firm with a flair for creative         able. We also coordinate our work with         in patent lawsuits. This type of litigation     practice to be in five years?
financing is going to do very well.               tax experts because much of what we do         is very costly, but because IP protection is
                                                 involves international tax structuring.        essential and without it a company can be       Reicin: My goal would be to play a sub-
Editor: It sounds as if this is a truly             In a practice such as mine, venture         prevented from receiving further funding,       stantial role in every significant life sci-
global practice.                                 funding is of particular importance. There     it can be a “bet the company” case. I           ences transaction in Canada and to
                                                 was a lull after 2000, but it has picked up    spend considerable time with our IP pros-       continue to grow as one of the major life
Reicin: It is. We counsel our clients to         momentum in the last few years. By the         ecutors and litigators in pre-litigation        sciences players in North America. The
have a global orientation from the outset.       beginning of this year biotech venture         strategies, both offensive and defensive.       practice will develop in response to grow-
When a company is thinking about a cure          capital had reached a crescendo and has        It is essential that these companies have a     ing industry needs. We just try to be
for cancer, it is not a cure for cancer in Tel   now subsided again – temporarily, we           strong anticipatory position in the present     proactive and stay a few steps ahead of
Aviv or Toronto. It is a global cure. We         hope. The nature of venture capital has        climate.                                        our clients.

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