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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. Please email the interviewee at email@example.com with questions about this interview.
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