Many companies are always on the lookout for in‑licensing opportunities and/or product acquisitions to boost their product portfolio or to quickly fill voids in their development program.  Given the cost outlay for such opportunities and their associated risks, it is imperative that due diligence of these new potential assets is performed by qualified individuals who know where to look, what to look for, and how to accurately assess compliance and regulatory risks.

Typically, there are two distinct areas of due diligence activities for product acquisitions.  The first addresses early development or pre‑approval products.  These products can include those in very early development phase up through products having just recently been submitted for approval to a regulatory authority.  Other acquisition targets focus on products that may have been recently approved up through those having a mature product presence.  In either case, most companies have a “checklist” of key items to review and assess, but is that enough to give the full picture of what they are buying?

So, what are some of the not-so-obvious things to look for?

  • Is there a robust change control quality system in place?
  • Are deviations being tracked and CAPAs being fulfilled?
  • Is there proper documentation and tracking of post-approval commitments?
  • Is a CMO involved? Are there proper and comprehensive technical and quality agreements in place?
  • What about a product that is in its final approval stages? What change controls are pending for submission upon approval and will they affect the launch of the product?
  • Did the company take advantage of key meetings with the FDA during the development cycle (i.e., pre-IND, end phase 2, pre-NDA)?
  • Trying to acquire a medical device? Aside from having an MDR policy in place, has the company been fulfilling its obligations under this policy (i.e., are they under-reporting)?  Are there adequate design controls in place?  Is the Design History File current and reflective of the entire development process?
  • Are routine annual compliance submissions submitted on time? Delays in routine compliance activities may be indicative of other problems.
  • Are safety reporting and follow‑up activities accounted for and documented?

This is by no means an all‑inclusive list of things to check but it does underscore the need to know what to look for and how to navigate the many activities associated with product development, regulatory approval, and compliance when performing due diligence.  So indeed, it’s “Buyer Beware” and best to bring your “A-Team” to the due diligence!  For further information or assistance in the due diligence process, please reach out to Lachman Consultant Services at