The generic pharmaceutical industry has expanded to include not only the production of off-patent drugs, but the creation of new therapeutic entities (NTEs) and complex and super generics. Developing high-efficiency delivery systems, improving manufacturing processes, and/or reformulating drugs for specific populations (e.g. pediatric patients) all require a significant investment in research and development (R&D). If your company innovates in generic pharmaceuticals, biosimilars, or branded generics, you may be able to recoup costs with the R&D Tax Credit.
Employee wages, raw materials & supplies, and third-party contractor costs associated with R&D activities are considered qualified research expenses (QREs). Companies can receive refunds of up to 22% of total QREs through federal and state tax credits, depending on the state in which your business operates.
Example activities that qualify:
- Creating new formulations to achieve better clinical responses
- Increasing delivery method efficiency (e.g. using nanotechnology)
- Assessing a repurposed drug for a new indication
- Testing biosimilars for activity and patient safety
- Improving manufacturing processes to enhance efficiency, output, etc.
- Conducting clinical trials (Phases I-IV) to gain FDA and other regulatory agency approval
Do you have these job titles on your payroll, or do you hire third-party contractors to do these jobs?
- Analytical Chemists
- Automation Scientists
- Clinical Data Scientists
- Product Development Managers
- Project Managers
- Research Scientists