Ebb & Flow

The Bank of New York has seen a big increase in the number of ex-U.S. biotech companies seeking Level I ADRs in order to get access to U.S. investors. The move is most likely being driven by lack of interest in local companies by home-country investors.

"I think there's a desire for companies in Europe and other regions to reach out to U.S. investors by way of establishing a U.S. trading facility that's low cost, doesn't subject them to SEC regulations or to Sarbanes-Oxley," Richard Smith, vice president of depositary receipts, told Ebb & Flow. "EU specialist funds investing in these companies are drying up, and the companies want to be able to get investors in the U.S. capital markets."...