Regulatory Due Diligence

At MyFDALawyers.com, PC, our FDA regulatory attorneys bring decades of specialized experience in conducting comprehensive due diligence for FDA-regulated transactions—representing both buyers and sellers. Our proactive, solutions-driven approach is designed to uncover hidden regulatory liabilities before they cost you millions—identifying compliance gaps, enforcement risks, and supply chain vulnerabilities that standard due diligence completely misses. For sellers, we help prepare for buyer scrutiny, identify and remediate issues proactively, and position your regulatory compliance as a deal strength rather than a liability. If you have any questions or concerns about regulatory due diligence, contact our FDA lawyers today for a fully confidential, no-obligation initial consultation.

The $7 Million Question: What Hidden FDA Risks Lurk in Your Transaction?

Every year, companies lose fortunes on FDA-regulated acquisitions gone wrong—and sellers watch deals collapse over regulatory issues they could have addressed proactively. The supplement brand with undisclosed ingredient risks that tanked valuation. The device manufacturer with unreported supplier defects that killed the transaction. The food company with looming recall exposure that triggered indemnity demands. These aren’t just deal complications—they’re potential business killers for both buyers and sellers that standard due diligence completely misses.

FDA regulatory due diligence is the specialized process of investigating and evaluating the complete regulatory compliance profile of FDA-regulated products and businesses. For buyers, this means uncovering hidden risks before closing. For sellers, it means identifying and addressing compliance issues proactively to maximize valuation and minimize deal disruption. Unlike standard M&A due diligence that focuses on financials and contracts, FDA due diligence uncovers the regulatory risks that can destroy deal value: misclassified products, unapproved marketing claims, undisclosed enforcement actions, supply chain violations, and quality system failures.

Our comprehensive approach involves systematic review of regulatory pathways, compliance history, enforcement exposure, quality systems, and supply chain risks to assess legal health and commercial viability. For buyers considering a merger, acquisition, or investment in FDA-regulated businesses, specialized regulatory due diligence can identify deal-breaking issues, prevent post-closing surprises, and ensure accurate asset valuation. For sellers preparing for transaction, our pre-sale compliance assessment identifies and remediates issues before buyer discovery, strengthens representations and warranties, reduces indemnity exposure, and maximizes enterprise value by demonstrating regulatory excellence. Key aspects of our FDA regulatory due diligence include:

• Product Classification and Pathway Review: We evaluate how the product is classified under FDA regulations and whether it follows the correct regulatory pathway. Misclassification can result in enforcement action and potentially incentivize removal from the market altogether. Proper classification of products should be a high priority for any FDA-regulated business.
• Claims and Marketing Compliance Audit: Marketing claims trigger more FDA enforcement actions than any other issue. Our comprehensive multi-channel review covers website content (including archived versions), social media across all platforms, Amazon and e-commerce listings, affiliate marketing programs, influencer partnerships, trade show materials, and sales training documents. We review substantiation files for clinical evidence, structure/function claim notifications, GRAS determinations, and safety data. We verify label compliance including required statements, warnings, nutrition/supplement facts panels, allergen declarations, and country of origin marking. Critical insight: third-party sellers, international websites, and old marketing materials indexed by Google can trigger enforcement even if the company stopped using them years ago—hidden danger zones that standard reviews miss entirely.
• Enforcement History Investigation: Public FDA databases tell only part of the story. Our investigation examines visible enforcement including Warning Letters (including those to suppliers/customers), Import Alerts and detention history, recall involvement, and 483 Observations with Establishment Inspection Reports. More critically, we uncover the real risks of non-compliance: Untitled Letters, Cyber Letters for online marketing, state regulatory actions, FTC enforcement for claim issues, class action litigation history, and customer complaint patterns. We also analyze the supplier network for contract manufacturer compliance status, key ingredient supplier issues, import detention risks in the supply chain, and FSVP compliance.
• Quality System and GMP Assessment: Quality System and GMP Assessment: Manufacturing and quality system failures can shut down operations overnight. We evaluate documentation systems including SOP completeness and currency, batch record integrity, complaint handling procedures, deviation and CAPA systems, and change control processes. When accessible, we assess physical compliance including facility condition, equipment qualification status, environmental monitoring programs, laboratory controls, and supply chain verification. We review personnel qualifications, training documentation, regulatory expertise depth, and consultant dependencies. Quality system deficiencies often represent the foundation of FDA compliance failures and can indicate systemic problems affecting multiple product lines.
• Supply Chain Risk Mapping: FDA holds you responsible for your entire supply chain. We trace upstream risks including raw material supplier compliance, country of origin concerns, certificate authenticity verification, exclusive supply vulnerabilities, and cost pressure quality impacts. We assess downstream exposures including distributor compliance practices, gray market diversion risks, international regulatory conflicts, and customer use patterns creating risk. Supply chain issues have derailed numerous acquisitions when buyers discovered key ingredient suppliers under Import Alert or contract manufacturers with undisclosed quality failures.

Critical Red Flags in FDA Due Diligence

Through our due diligence work, we’ve identified critical warning signs that indicate serious regulatory problems. These red flags often signal when to walk away from a deal or demand substantial price adjustments and indemnities:

• The “Lost” Documentation: When sellers claim they “can’t find” critical regulatory documents—510(k) clearance letters, NDI notifications, or clinical data—this indicates either poor regulatory management or intentional concealment. We’ve seen this red flag precede discovery of products that were never actually approved or cleared. If regulatory documentation is “somewhere in storage” or “taken by a previous employee,” this warrants extreme scrutiny or deal termination.
• The Revolving Door: Multiple regulatory consultants within two years, recent “resignation” of the quality head, or sudden change in legal counsel often indicates unresolved compliance problems or regulatory pressure. Companies with stable, effective compliance programs retain their regulatory personnel. High turnover in regulatory positions suggests either management unwilling to address issues or problems so severe that qualified personnel won’t stay.
• Semantic Games: Be wary when sellers use phrases like “FDA hasn’t objected” (versus “FDA approved”, “substantially compliant” (versus “compliant”), or “no recent Warning Letters” (what about old ones?). This careful language often conceals regulatory problems. Similarly, claims that products are “registered” rather than “cleared” or “approved” may indicate the company doesn’t have required regulatory authorizations. These linguistic red flags frequently precede discovery of significant compliance gaps.

Why Trust Us for Matters of FDA Regulatory Due Diligence

For FDA-regulated businesses, proactive compliance is a must. Our firm provides regulatory due diligence services that businesses and organizations can trust. With decades of experience, Bill Senior and Rick D. Quinn are lawyers who are prepared to go the extra mile to do what is best for clients. Among other things, our FDA regulatory due diligence attorneys are ready to:

• Conduct a comprehensive, confidential review and evaluation of your case;
• Answer your questions and explain the relevant regulatory requirements; and
• Develop a regulatory due diligence strategy that is best suited for your specific case.