Eli Lilly’s $165 million R&D acquisition is questioned by the US SEC
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Eli Lilly’s $165 million R&D acquisition is questioned by the US SEC
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Eli Lilly’s $165 million R&D acquisition is questioned by the US SEC
A few days ago, Lilly’s up to $165 million in development milestone payments were charged and questioned by the U.S. Securities and Exchange Commission (SEC).
The SEC said that none of the payments were in compliance with generally accepted GAAP standards of accounting issued by the Financial Accounting Standards Board, and emphasized in the notification letter that the charges would have an impact of approximately $0.15 per share on Eli Lilly’s earnings and, therefore, the actual amounts may differ from the company’s Current expectations are different.
In addition, in the SEC letter, Lilly was asked to provide unaudited historical financial information about the acquisition and to post the relevant information on the investor page of its website.
In response, Eli Lilly said that the company is making necessary changes to the presentation of financial indicators that do not conform to generally accepted accounting principles in accordance with the guidance of the U.S. SEC.
In February 2021, Eli Lilly came under scrutiny by the SEC for “improper communications” between former CFO Josh Smiley and multiple employees.
Although Smiley’s actions were unrelated to financial data, Lilly was still required to file with the SEC at the time. Relevant documents show that Smiley finally gave up its 2020 cash dividend of $1 million and about $3 million in shareholder awards and other assets.
At the same time, the U.S. SEC confiscated Smiley’s assets of up to $24 million.
The move is seen as a powerful move by the U.S. government to crack down on drug giants’ irregularities. Just two weeks ago, the U.S. Senate and House of Representatives introduced the latest legislation to increase competition and stimulate innovation among pharmaceutical companies.
The bill was eventually passed mainly because the U.S. House of Representatives Oversight and Reform Committee investigated several large pharmaceutical companies and found that they were suspected of knowingly hindering generic drugs and biosimilars from entering the market.
Among them, the large pharmaceutical companies named and criticized include Eli Lilly, Sanofi, Novo Nordisk, AbbVie, etc.
Reference:
Eli lilly faces $165m in charges over r&d acquisitions in latest sec exchange
Eli Lilly’s $165 million R&D acquisition is questioned by the US SEC
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