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Investment income is treated as the top slice of income so that the allowances and lower rate b

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

ands are used against earned income first and against income from savings before dividends.

In

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

vestment income is taxed at 20% unless your total income for the year enters the 40% band. Then

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

a further 20% is payable on any income in that band from which 20% has been deducted at source

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

.

if total income for the year is below the 20% band, investment income is taxed at 10% and if

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

it is below the lo% band it is is tax free. Tax deducted at source at 20% can be recovered.

T

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

ax is deducted from bank and building society interest at the rate of 20% before it is paid, un

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

ess recipients have completed a form (obtainable from the bank or building society) saying that

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

their total income is below their total allowances.

Dividends on shares are treated as having

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

been taxed at source at 10% (this is sometimes called the dividend tax credit). It cannot be a

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

voided and cannot be recovered by a non taxpayer. Higher rate taxpayers must pay a further 32.5

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

%.

Investments can be transferred between spouses to take advantage of one having lower income

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

tax rates than the other, without incurring capital gains or inheritance tax liabilities, or s

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

tamp duty.

Investments free of income tax

Income from the following investments is fre

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

of tax:

National Savings certificates, children's bonus bonds and premium bonds
t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
>
ISAs and PEPs
TESSAs (till maturity)
friendly society savings scheme

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

venture capital trusts

commercial forestry

Tax relief on

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

amount invested

There are also certain investments which earn income tax relief on the amo

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

unt invested. The relief would be at your highest tax rate. They are:

pension scheme contribut

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

ions within Inland Revenue limits new enterprise investment schemes and venture capital trusts

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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