Useful Advices - Business

When it comes to the term ‘offshore’ used in conjunction with company incorporation, the term ‘offshore’ generally refers to any jurisdiction other than one in which the company

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

incorporated will conduct the majority of its activities.

Usually such a jurisdiction has some degree of taxation or reporting benefit attached that makes it attractive to the

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

Examples of combination products may in

company owner, and the concept of incorporating a company offshore will bring at least one of the following five benefits to a business owner: -

1) Ease of Operations –

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

depending on the jurisdiction and the type of business activity to be conducted under the company name to be incorporated, the operating restrictions, auditing and accounting re

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

quirements and standards to which the business and its employees and directors must adhere are often far less restrictive offshore than onshore.

Exceptions to this rule are fin

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

Combination pro

ncial services based companies in many jurisdictions for example, who have to comply with extra regulatory legislation for the protection of the company’s clientele.

The advant

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

age of easing operations particularly for a small or start up company is a reduction in operating costs and in the amount of time a company’s directors have to dedicate to form

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

filling and report filing.

2) Reporting Simplification – this ties in with the first benefit; in the majority of offshore jurisdictions favoured for company incorporatio

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

the company activity reporting requirements are often far fewer and simpler as the business activities entered into by the company are conducted outside of the jurisdiction in

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

which it is incorporated.

Furthermore personal information relating to the company’s directors and shareholders need not be declared in all cases or the extent to which persona

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

information is required is far less intrusive.

3) Taxation Reduction/Negation – the reduction in taxation liability is one of the main benefits associated with investin

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

Following aspects would a

g offshore, opening an offshore bank account or incorporating a company offshore.

If you set up your company in a low or no tax jurisdiction you could potentially save yourself

dd to the challenges in developing combination products:

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

substantial amounts of money legally. Often the rules are that if the company incorporated in a particular jurisdiction never derives an income from the local economy it can o

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

erate tax free.

It’s therefore possible to use an offshore company in an overall international business structure and ensure profits are posted in the offshore jurisdiction and

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

so no tax is liable! Many international corporations operate in this way and actually negate their tax liability fully.

4) Asset Protection – by operating a company of

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

shore, i.e., outside the jurisdiction in which the company operates, it is sometimes possible to position assets away from the reach of any potential litigious action and also t

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

Professional from academic institutions, pharmaceutical industries, health care indust

o shield business transactions from the eyes’ of the competition.

5) Personal Privacy Protection – the level to which a director or shareholder’s personal information is

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

required, held, visible or investigated offshore is likely to be far less invasive and intrusive than onshore. It is also possible to appoint nominee directors and secretaries

.

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

for offshore companies in many jurisdictions thus keeping the true company owner’s identity shielded.

The information contained in this article cannot constitute advice. Each

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

Companies that provide selfless information through particip

individual’s circumstances are unique and whether or not offshore company incorporation is something that could benefit your business can only be determined with personal advice

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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