Direct answer
A shareholder exit in life sciences turns on more than the share register: the marketing authorisation, the exclusive licence and the milestone schedule usually decide whether the sale closes as agreed. Where the target holds a medicinal product authorisation or has out-licensed core technology, the buyer needs the regulator's transfer confirmed and the counterparty's consent secured, or the deal completes on paper and stalls in practice.
Why this arises here
Life sciences companies rarely hold their value in physical assets. The value sits in a patent family, a clinical dossier, a collaboration agreement with a larger partner, or a marketing authorisation registered in a subsidiary's name. Many targets started as a university spin-off, which means the chain of title to the core patents runs through an academic institution and one or more inventor-employees before it ever reaches the company's own books. A shareholder who wants to sell, or who is being squeezed out by a co-founder or a venture investor, is negotiating against contracts and registrations that a logistics business or a retailer simply does not have.
The mechanics in short
The exit route, share sale or asset sale, is decided in part by whether the marketing authorisation and the underlying licences can move with the shares or must be separately transferred and re-registered. A share sale keeps the corporate entity, and with it the marketing authorisation held by that entity, intact. An asset sale moves the patents, the dossier and the collaboration agreements individually, and each may carry its own consent or notification requirement to a regulator or a licensing partner.
Due diligence in this sector therefore runs two tracks in parallel: the corporate track, covering the cap table, any shareholders' agreement and board approvals for the sale, and the regulatory and contractual track, covering the marketing authorisation, the patent chain of title and every licence with a change-of-control clause. Governance friction, a co-founder refusing to sign off, a board split on timing, is common precisely because these two tracks rarely move at the same speed, and one shareholder can hold up the other side's readiness to close.
The pattern specific to life sciences and exit
Three features recur here and would be misplaced on a page about any other sector.
First, exclusive licensing and collaboration agreements with a commercial partner, often a larger pharmaceutical or medtech company, routinely contain a change-of-control clause. That clause can give the partner a right to terminate, renegotiate royalty terms or claw back exclusivity the moment the shareholding structure changes. A shareholder planning an exit has to check this before agreeing a price, not after.
Second, milestone and royalty rights tied to clinical or regulatory progress make the consideration contingent rather than fixed. An exit price built on milestones still to be achieved needs an escrow or earn-out mechanism, and a departing shareholder needs to know how that contingent value is held and released, since it will not arrive at closing.
Third, where a founder or an academic co-inventor remains an employee, a compensation claim by an employee-inventor can surface at the point of an exit, because a liquidity event is exactly when the value of an invention becomes visible and disputable. This risk does not exist for a shareholder exiting a business built on contracts and trade, because there is no inventor to compensate.
What to check
A shareholder preparing to exit, or facing exclusion by others, should establish: the chain of title to every patent and application, back to the inventor and any university agreement; whether the target or a subsidiary is the registered holder of any medicinal product marketing authorisation and what a change of control does to that registration; whether any licensing or collaboration agreement contains a change-of-control clause and what it triggers; how milestone and royalty payments are structured and whether they are shareholder-level or company-level rights; and whether any co-founder or inventor has an outstanding or foreseeable compensation claim.
Where the friction sits
| Issue | Where it is recorded | Who holds the right | Effect on the exit |
|---|---|---|---|
| Marketing authorisation | Regulator's register (holder of record) | The company or subsidiary as authorisation holder | Not automatically transferred by a share sale in every case; re-registration can be required on an asset sale |
| Exclusive licence or collaboration agreement | The agreement itself | The commercial partner (licensee or licensor) | Change-of-control clause may allow termination or renegotiation on exit |
| Milestone or royalty schedule | The agreement itself | The commercial partner, paid to the company | Contingent value not received at closing; needs escrow or earn-out drafting |
| Patent chain of title | Patent register and assignment deeds | Original inventor, university, or co-founder | Gap in the chain can block a clean sale of the IP |
| Employee-inventor compensation | No public register; a personal claim | The inventor-employee | Can surface as a claim at the point of a liquidity event |
What this does not cover
- The tax treatment of an exit in a life sciences structure, which depends on the entity form and is not addressed here.
- The regulatory approval process for a medicinal product itself, as distinct from who holds the resulting authorisation.
- Valuation methodology for milestone or royalty payments.
- Employment law questions arising when research staff transfer with the business.
- Cross-border marketing authorisation questions outside the Netherlands, including EU-level authorisations.
Questions
Does selling the shares automatically transfer the marketing authorisation?
Not in every case. Where the authorisation sits with the company itself, a share sale usually leaves it in place because the legal entity does not change. Where the transaction is structured as an asset sale, or where the regulator's own rules treat a change of control as a notifiable event, a separate transfer or re-registration step is often required, and this should be checked before signing, not after.
Can a licensing partner block the exit?
A licensing partner cannot block a shareholder from selling shares as such, but a change-of-control clause in the licence can give the partner a right to terminate, renegotiate or reclaim exclusivity once the sale completes. If the licensed technology is central to the target's value, that clause functions as a practical veto on price, even though it is not a legal veto on the transaction itself.
What happens to unpaid milestone payments after the sale?
That depends on how the sale and purchase agreement allocates them. They can be assigned to the buyer, retained by the selling shareholders as a separate right, or split through an earn-out mechanism tied to the same milestones. Where the payments are contingent on events that have not yet occurred, an escrow or a deferred consideration structure is the usual way to hold that uncertainty without stalling the closing.
About this note
Written by Eva Kuipers, who works on governance disputes and Enterprise Chamber proceedings. In life sciences exits, the recurring instruction is a shareholder or co-founder blocked by a board split or a partner's change-of-control clause, which is a governance question before it is a contract question.
For a full mapping of the corporate structure, the licences in force and where the friction points sit before you negotiate an exit, see a structure report. This sits within our wider corporate law and governance practice.
Related reading: how exit works in a different sector with different contract patterns, logistics and transport exits; how group structure is handled in a technology setting, the group structure question in technology and SaaS; how a structure report is used ahead of a different transaction type, a structure report before a real estate purchase; and what a departing board member's discharge resolution actually covers, the discharge resolution and its scope.
To discuss the specifics of your position, get in touch with our corporate practice.
Last legal review: 2026-09-28