SEC-FDA agreement heightens disclosure and insider-trading risks for life sciences companies

On August 31, 2026, the US Securities and Exchange Commission (SEC) and US Food and Drug Administration (FDA) announced that they entered into a new memorandum of understanding (MOU) designed to increase information sharing and cooperation between the agencies. According to the SEC, the agreement is intended to enhance the agencies’ regulatory and enforcement efforts and includes protocols for exchanging information relevant to the agencies’ respective missions.

The announcement is particularly significant for public life sciences companies. The MOU expressly contemplates the FDA providing nonpublic information to the SEC for use in public-company filing reviews and enforcement investigations. It also establishes designated channels through which the SEC’s Division of Enforcement and Division of Corporation Finance can communicate with the FDA.

Earlier this year, we identified FDA-related disclosures as an area of heightened SEC enforcement risk, notwithstanding the Commission’s otherwise-reduced enforcement activity. Recent SEC actions have focused closely on whether companies’ public statements accurately reflected FDA communications, clinical data, and regulatory developments. In several cases, the SEC has pursued individual executives responsible for those disclosures. The new MOU provides SEC staff with a more formalized mechanism for obtaining FDA information when investigating potential disclosure violations.

What the MOU does

The MOU establishes a formal framework for exchanging information concerning companies and individuals engaged in FDA-regulated activities. Most notably, it provides that the FDA may share otherwise nonpublic information with the SEC and expressly recognizes that the SEC may use that information to inform a public-company filing review or “in connection with any enforcement investigation, proceeding, or civil action” within the SEC’s jurisdiction.

The agreement also establishes mechanisms for receiving information requests and securely transmitting nonpublic information. The SEC must maintain points of contact in both the Division of Enforcement and Division of Corporation Finance, while the FDA’s Office of Chief Counsel will serve as the FDA lead for referrals of potential violations to the SEC.

Importantly, the MOU restricts the SEC’s ability to further disclose information received from the FDA. The SEC generally may not provide nonpublic FDA information to anyone outside the agency without the FDA’s written permission, and the MOU contemplates that FDA materials may be marked “Do Not Disclose Without FDA’s Written Permission.”

Why the agreement matters

FDA communications often reflect an ongoing process in which regulatory assessments continue to evolve. A company may receive questions, concerns, preliminary views, requests for additional information, or other regulatory feedback while discussions with the FDA remain ongoing. Determining when that information becomes material and how it should be characterized publicly can present complex disclosure questions.

Those judgments have increasingly become the subject of SEC enforcement actions. As we discussed in our January 2026 analysis of SEC enforcement trends affecting pharmaceutical, life sciences, and healthcare companies, recent cases demonstrate the SEC’s willingness to scrutinize differences between companies’ public descriptions of clinical or regulatory developments and their underlying communications with the FDA. In one January 2026 action, for example, the SEC alleged that two former executives made misleading statements concerning a candidate drug’s efficacy because their public statements did not adequately disclose concerns raised by FDA staff during its review, even though the company had disclosed that the FDA had identified deficiencies with its application.

The MOU could make these investigations easier to develop. Rather than relying principally on documents obtained from the issuer, testimony concerning FDA communications, or more-cumbersome FDA information requests, SEC staff now have an express framework for seeking relevant nonpublic information directly from the FDA. SEC Chairman Paul Atkins underscored the significance of this information in announcing the MOU, stating that “FDA-related disclosures by public companies have a significant impact on our markets.”

The same information may also be relevant to insider-trading investigations. FDA communications concerning clinical trial results, regulatory concerns, or the prospects for approval may constitute material nonpublic information and can help establish what information existed and when. More-direct access to those communications may therefore assist SEC staff in evaluating trading that occurred while significant FDA developments remained nonpublic.

The MOU’s confidentiality provisions, however, may have a less obvious consequence for companies and individuals under investigation. Although SEC staff may use nonpublic FDA information in an enforcement investigation, the MOU generally prohibits the SEC from disclosing that information outside the agency without the FDA’s written permission. Those restrictions could limit the staff’s ability to share underlying FDA materials with companies and individuals during an investigation, including during the Wells process.

That potential limitation is notable given the Commission’s recent emphasis on greater transparency in enforcement investigations and providing potential respondents with greater access to the information underlying potential charges so that they can meaningfully respond during the Wells process. The MOU introduces a potentially competing consideration: SEC staff may have access to nonpublic FDA information relevant to its investigative or charging conclusions that the staff cannot disclose to the subjects of the investigation. The MOU recognizes the issue by providing that the agencies will work together when information needs to be further disclosed, but how that process will operate in practice remains to be seen. Any such confidentiality restrictions, however, would be unlikely to prevent disclosure of relevant materials if the matter proceeds to litigation.

The MOU also could affect the SEC’s review of public-company disclosures before a matter reaches Enforcement. Because Corporation Finance is specifically included in the agreement, FDA information could inform the staff’s review of periodic reports, registration statements, and other issuer filings. A discrepancy identified through that process could generate comments to the issuer and, depending on the circumstances, potentially lead to an Enforcement referral.

Part of a broader shift toward greater transparency

The MOU also should be viewed alongside the FDA’s recent efforts to make more regulatory information publicly available. As we previously discussed, the FDA announced in 2025 that it would begin publishing certain complete response letters that historically had remained confidential between the agency and applicants. That change increased the ability of investors, plaintiffs’ lawyers, and regulators to compare an issuer’s characterization of the regulatory process against the FDA’s own account.

The new MOU addresses the other side of that equation: information that remains nonpublic. It creates procedures through which such information can move between the FDA and SEC while retaining confidentiality protections. The combination potentially reduces the informational gap that historically existed between the two agencies when evaluating public-company disclosures.

What companies should consider now

The MOU does not change the securities laws or create a new disclosure obligation. Nor does every concern, question, or preliminary observation from the FDA necessarily require disclosure. But the agreement changes the practical environment in which existing disclosure judgments may later be evaluated.

Public companies operating in FDA-regulated industries should assume that, if their disclosures concerning a significant clinical or regulatory development later attract SEC scrutiny, the SEC staff may seek the underlying FDA communications directly from the agency. Companies should consider whether their disclosure controls appropriately identify significant FDA communications and ensure that the personnel responsible for SEC filings and investor communications understand the substance and context of those communications. Judgments about trading windows and insider trading compliance also should be evaluated with the new policy in mind.

The consistency among FDA communications, internal assessments, board and management materials, SEC filings, earnings calls, investor presentations, and other public statements may take on increased significance under the new information-sharing framework. Recent enforcement actions demonstrate that the Enforcement Division may examine the entire record when assessing whether investors received an accurate picture of a clinical or regulatory development. As we previously observed, deviations between public disclosures and internal documentation are particularly difficult to defend under regulatory scrutiny.