Biotechnology & Pharmaceutical

Since the inception of the R&D Tax Credit, pharmaceutical companies have been one of the largest credit claimants. The activities required to take a new drug from laboratory concept to fully approved commercial product naturally require intense experimentation in highly scientific areas. However, with complicated patent structures and expensive R&D pipelines, pharmaceutical investment in qualified R&D activities had declined.

In recent years, there has been a renewed enthusiasm for exploratory R&D in the pharmaceutical & biotechnology sector. Emerging discoveries surrounding regenerative medicine, biologics, therapeutics, and preventative medicine have produced an increase in companies seeking to bring new products to market. These efforts naturally require biotechnology and life sciences companies to engage in activities that meet the four-part requirements of the R&D Tax Credit. Qualified research in this sector is compounded when companies attempt to use advanced analytics and software-based technologies in new product applications.

Biotechnology & Pharmaceutical companies performing the following activities may be eligible for the R&D Credit:

• Investing in scientific research to develop a framework for new products
• Developing formulations for new products
• Improving the performance of existing products
• Genetics Research
• Performing internal or external laboratory testing on new products
• Developing or improving manufacturing and production processes
• Investing in bioinformatics development
• Attempting to utilize software and analytics in product development
• Regenerative medicine development
• Therapeutics product development
• Nutraceutical product development
• In-vivo testing
• Clinical R&D processes
• FDA approval
• Testing new techniques and methods for applying new medical technologies

The activities above are an abridged list of the many activities companies in the biotechnology and pharmaceutical industry perform. Companies may claim credits for expenses associated with wages, third-party lab testing, consultants, lab supplies, and raw materials toward the R&D Credit. For a free analysis of your potential R&D Credit benefit, please contact the team at Diligentiam or visit our R&D Credit Estimator.

R&D Tax Credits

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