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Are you paying too much in income taxes? Are you getting all the credits and deductions you are entitled to? Here are 7 tips to help you mi

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

nimize taxes and keep more in your pocket:

1. Participate in company retirement plans. Every dollar you contribute will reduce your taxabl

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

Examples of combination products may in

income and thus your income taxes. Similarly, enroll in your company’s flexible spending account. You can set aside money for medical expe

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

ses and day care expenses. This money is “use it or lose it” so make sure you estimate well!

2. Make sure you pay in enough taxes to avoid

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

penalties. Uncle Sam charges interest and penalties if you don’t pay in at least 90% of your current year taxes or 100% of last year’s tax l

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

Combination pro

ability.

3. Buy a house. The mortgage interest and real estate taxes are deductible, and may allow you to itemize other deductions such as

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

property taxes and charitable donations.

4. Keep your house for at least two years. One of the best tax breaks available today is the hom

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

sale exclusion, which allows you to exclude up to $250,000 ($500,000 for joint filers) of profit on the sale of your home from your income.

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

However, you must have owned and lived in your home for at least two years to qualify for the exclusion.

5. Time your investment sales. If

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

your income is higher than expected, sell some of your losers to reduce taxable income. If you will be selling a mutual fund, sell before th

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

year-end distributions to avoid taxes on the upcoming dividend or capital gain. Also, you should allocate tax efficient investments to you

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

Following aspects would a

r taxable accounts and non-efficient investments to your retirement accounts, to reduce the tax you pay on interest, dividends and capital ga

dd to the challenges in developing combination products:

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

ns.

6. If you’re retired, plan your retirement plan distributions carefully. If a retirement plan distribution will push you into a higher

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

tax bracket, consider taking money out of taxable investments to keep you in the lower tax bracket. Also, pay attention to the 59-? age limi

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

. Withdrawals taken before this age can result in penalties in addition to income taxes.

7. Bunch your expenses. Certain expenses must ex

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

eed a minimum before you can deduct them (medical expenses must exceed 7.5% of your adjusted gross income and miscellaneous expenses such as

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

Professional from academic institutions, pharmaceutical industries, health care indust

tax preparation fees must exceed 2% of your AGI). In order to deduct these expenses, you may need to bunch these types of expenses into a si

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

gle year to get above the minimum. To achieve this, you might prepay medical and miscellaneous expenses on December 31 to get above the mini

.

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

um amount.

The most important thing is to be aware of the tax deductions and credits that apply to you and to plan for taxable events. And

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

Companies that provide selfless information through particip

on’t be afraid to ask for help. The benefits from consulting an experienced tax professional far outweigh the cost to hire that professional

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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Recent unearthing of frauds and data theft and the subsequent sting operations followed by US and UK has left many in lurch. With outsourcing on the rise in the financial-services industry, there has been widespread discussion about the security of sensitive data. As we all know, data is the lifeblood of the internet driven industry and its integrity cannot be compromised. However, there is a more intense frenzy around data security and outsourcing abroad.

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