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Advice You - Financing Your Business with Accounts Receivable Factoring
Obtaining growth capital has always been a major challenge – and stumbling block – for companies. Many business o
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
wners feel that the available options from a bank, basically a business loan or a line of credit, are close to im
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
ossible to obtain. Furthermore, most business owners have to go through a loan underwriting cumbersome process th
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
at takes weeks only to find out if they qualify. And, more often than not, they don’t qualify because banks have
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
ough requirements and usually demand that the business owner have spotless credit.
However, if you own a busines
However, if you own a busines
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
that is selling services or products to good commercial clients, you have an alternative option. And you won’t f
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
ind it at a bank.
The option is called accounts receivable factoring and it enables you to capitalize on your bi
The option is called accounts receivable factoring and it enables you to capitalize on your bi
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
gest asset, your invoices from great clients. Factoring provides you with the working capital you need to grow yo
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
r business and can help you if your biggest challenge is that your customers pay in 30 to 60 days. Factoring prov
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
ides you with an advance payment, giving you the necessary funds to meet ongoing expenses such as payroll or rent
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
It eliminates the 60 day wait and gets you paid in as little as 2 days.
As opposed to business loans or lines o
As opposed to business loans or lines o
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
credit, accounts receivable factoring is easy to obtain. The biggest requirement is that you do business with cl
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
ients that are creditworthy and pay reliably. It can work with startups or established companies. Furthermore, ac
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
ounts receivable financing lines have limits that are tied to your sales. This means that as your sales increase,
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
so does your financing.
Receivables factoring is also fairly easy to use. It works as follows:
1. You deliver g
Receivables factoring is also fairly easy to use. It works as follows:
1. You deliver g
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
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
oods / services and invoice for them
2. The factoring company buys your invoice and advances you up to 90% (1st
2. The factoring company buys your invoice and advances you up to 90% (1st
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
nstallment) of the invoice
3. Once the invoice is paid, the factoring company rebates the remain funds less a sm
3. Once the invoice is paid, the factoring company rebates the remain funds less a sm
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
ll fee (the 2nd installment)
Receivable financing fees vary based on a number of parameters but can range from 1
Receivable financing fees vary based on a number of parameters but can range from 1
.
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
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
.5% to 3%, making it a very affordable business financing tool. To qualify for accounts receivable factoring, you
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
company must sell goods / services to commercial or government customers and have profit margins of at least 10%
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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