Many activities throughout the drug development process qualify as research and development (R&D). Discovering new drug targets and designing biologics and small molecules require extensive in vitro, pre-clinical, and clinical studies. The R&D Tax Credit can significantly offset these costs.
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:
- Producing experimental qualification batches or clinical trial lots
- Designing and implementing scale-up processes for manufacturing
- Creating machine learning (artificial intelligence software) approaches to aid in drug development
- Conducting pharmacodynamic assays on an experimental compound
- Consolidating scientific data necessary for FDA or other regulatory agency approval
- Analyzing mechanisms of action, downstream effects, etc.
- Customizing standard assays to create new or improved protocols
Do you have these job titles on your payroll, or do you hire third-party contractors to do these jobs?
- Analytical Scientists
- Cell Culture Technicians
- Clinical Pharmacologists
- Contract Research Personnel
- Machine Learning Software Developers
- Pharmacometrics Managers
- Postdoctoral Research Fellows
- Research Scientists