The D&O market has erupted for life sciences companies. Since the JOBS Act in 2012, there have been over 500 IPO’s in the life science space. There is an unprecedented amount of publicly traded life science companies, but over fifty percent of them have market caps under $300 million. Half of those companies have market caps under $50 million. Carriers have taken a shotgun approach to the IPO increases and grouped all of these companies as “life science.”
Life science companies have always been the target of lawsuits. Interestingly, there are certain types of life science companies that have never been sued. We are exploring this unique phenomenon and are curious as to why these companies that have limited exposure are continuing to be treated like a life science buyer with a lot of exposure.
Merger objection claims have also increased. 85 percent of the M&A deals have had a merger claim. According to a Chubb publication, shareholders have received zero dollars in 85 percent of those cases. Some of these cases have closed in as little as 19 days.
C3 recently developed technology that instantly answers underwriter questions when quoting primary for life science companies. We have shared this data with some of the underwriting community and have already had positive responses to our ability to educate about specific exposures.
We are focused solely on our clients and how to fix the D&O marketplace for life science companies. C3 is the restoration of the dominant, privately held, locally owned brokerage firm. C3 has the most innovative equity plan in the U.S. We are now over 80 employees and continue to add talent at every level of our organization.
Mike Milligan established the life science practice at Barney & Barney. He built the practice from zero to 600 clients. After the sale of Barney & Barney, Mike felt the need to be more entrepreneurial and joined C3 in September 2019. Mike can be reached at (858) 531-1964 or mike@c3insurance.com.
