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How many times have you heard someone say, "I don't pay any taxes. My accountant takes real good care of me . . . I haven't paid a dime in taxes in years."

Does that outrageous statement sound familiar?

May

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

be it's your brother-in-law, or a fellow Soccer Mom, or a co-worker at the office.

And so you think to yourself, "What am I doing wrong? How come I'm paying taxes and so-and-so says he/she pays nothing? Ho

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

Examples of combination products may in

do they do it!"

Is it really possible to pay "zero taxes"?

For purposes of this article, let's give your "no-tax" friend or relative a name. Let's call him "Charlie" (or if he is a she, just think "Charlen

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

e").

OK, what is Charlie up to? What's his secret?

Charlie has no secret. He's not doing anything that you should be doing. Do not be envious of Charlie, and here's why . . .

I can think of at least five

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

reasons you should ignore whatever Charlie says about his "no-tax" situation.

REASON #1: Charlie is a liar. Every family has one, so don't feel bad. Let's face it, some people just like to indulge in fabric

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

Combination pro

ations to make themselves feel good. Charlie is telling you a big fat lie because Charlie has "issues." 'Nuff said?

REASON #2: Charlie is pond scum. OK, hear me out on this one. I don't mean to offend you

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

f Charlie is a close and dear relative, or your best friend, but I'm going to give it to you straight: Charlie cheats on his tax return, and he cheats big time. There are plenty of folks out there like Char

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

lie. He's one of the reasons that you and I pay so much in taxes -- he doesn't report all his income, and he deducts bogus expenses by the thousands.

He and his accountant may even be in cahoots on this. Ch

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

rlie brings in his records and his accountant crunches the numbers, then calls Charlie and says, "You owe $5,000." So Charlie rummages around in his files and somehow manages to come up with another batch of

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

expenses that miraculously reduce his balance due to zero. It's like magic!

End result: Charlie's tax return is a big lie.

Charlie is a thief. Charlie should be put in jail for the tens of thousands in taxe

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

he has illegally withheld from the government over the years.

REASON #3: Charlie is stupid. Again, I'm sorry if I'm being too hard on Charlie. But some people are so clueless about taxes that if they have n

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

Following aspects would a

balance due on their return, or if they are getting a refund, they mistakenly believe they didn't pay any tax that year.

And believe it or not, this is actually a very common misconception that thousands of

dd to the challenges in developing combination products:

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

people cling to. Ah, to be so blissfully ignorant!

I hope you are not so naive to think that the "bottom line" on your tax return tells the whole story about your tax liability. It doesn't.

REASON #4: Ch

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

rlie is broke. Charlie may actually pay zero taxes because --are you ready for this one? -- Charlie doesn't make any money!

Charlie owns a small business or works full-time at his self-employment activity, a

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

nd Charlie may rake in hundreds of thousands in income from sales of his product or service -- but Charlie's business spends more than it brings in, and Charlie's business has a loss every year.

So Charlie d

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

esn't really have a tax problem. Instead Charlie has any number of other problems. He has a marketing problem, or a management problem, or a personnel problem. Charlie's business is failing, and paying zero t

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

Professional from academic institutions, pharmaceutical industries, health care indust

axes is just a symptom of a business that will eventually close.

REASON #5: Charlie is just scraping by. Charlie's business may not be losing money every year, but it's not really making much either. He ha

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

a small profit -- enough to keep him busy. His business may even "look" profitable, but it's really the classic shoestring operation.

So now, I ask you, do you really want to pay zero taxes? People who don'

.

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

t pay taxes are usually in one of these five categories: Chronic Liars, Pond Scum, Stupid, Broke, or Just Scraping By.

The purpose of business is to be profitable.

The unavoidable result of a profitable busi

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

Companies that provide selfless information through particip

ess is taxes. And yes, you should do everything legally possible to reduce those taxes. But if you are going to be successful, you are going to pay some taxes.

When it comes to taxes, stay away from Charlie

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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