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1. Regulators make new challenge to French securitization.

Author

Parolai, Richard and Paper, Xavier

Subjects
INTERNATIONAL accounting standards, STOCK exchanges, CAPITAL market, ASSETS (Accounting), FINANCE
Abstract

French financial regulators have unexpectedly intervened in local convergence with international accounting standards. In March 2002, the European Council in Barcelona reaffirmed its willingness to converge financial services by 2003 and implement an effective globalization of the capital markets by 2005. Subsequent calls for European listed companies to harmonize their financial reporting were enacted the same year when the European Commission approved Regulation 1606–2002. Pressure on listed companies reached a new height when, quite unexpectedly, the French stock market regulator, the Commission des Opérations de Bourse, and the supervisory arm of the Banque de France, the Commission Bancaire, jointly published new recommendations on the appropriate accounting treatment of deconsolidation structures and asset sales.sales.

Published
2003

2. Consequences of Disclosing Clinical Trial Results: Evidence from the Food and Drug Administration Amendments Act

Author

Thomas Borveau, Yin Wang, Vedran Capkun, Hong Kong University of Science and Technology (HKUST), Groupement de Recherche et d'Etudes en Gestion à HEC (GREGH), Ecole des Hautes Etudes Commerciales (HEC Paris)-Centre National de la Recherche Scientifique (CNRS), Institut Jean-Pierre Bourgin (IJPB), AgroParisTech-Université Paris-Saclay-Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement (INRAE), and HEC Paris Research Paper Series

Subjects
Product Problem, 050208 finance, Medical device, information asymmetry, business.industry, 05 social sciences, Accounting, clinical trial, regulation, 050201 accounting, JEL: I - Health, Education, and Welfare/I.I1 - Health/I.I1.I18 - Government Policy • Regulation • Public Health, Clinical trial, Food and drug administration, Information asymmetry, JEL: M - Business Administration and Business Economics • Marketing • Accounting • Personnel Economics/M.M4 - Accounting and Auditing/M.M4.M41 - Accounting, 0502 economics and business, Complaint, [SHS.GESTION]Humanities and Social Sciences/Business administration, Business, JEL: M - Business Administration and Business Economics • Marketing • Accounting • Personnel Economics/M.M4 - Accounting and Auditing/M.M4.M48 - Government Policy and Regulation, Adverse effect, disclosure, Capital market, health care economics and organizations
Abstract

We examine how the U.S. Food and Drug Administration Amendments Act (FDAAA) of 2007, which requires additional disclosures regarding clinical trial results, impacts information asymmetry between the disclosing pharmaceutical firm and capital market participants, the general public, academics, and practitioners. We document a reduction in information asymmetry in capital markets. We also document an increase in adverse event and product problem complaint reports filed against the pharmaceutical firms to the FDA and a higher number of drug and medical device recalls for affected firms after the FDAAA enactment. Finally, cross-sectional analyses suggest that the increase in FDA complaint reports and recalls after the FDAAA enactment was more prominent in firms with a higher bid-ask spread decrease. Taken together, our results suggest that the FDAAA has some benefits for both investors and consumers.

Published
2020