Advice You - Business

Accounts receivable factoring is the sale of part or all of a debt that someone owes to your company. When companies purchase a debt through accounts receivable factoring, they pay for your

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

invoice at a discount. They then collect the debt directly from the company who owes you money.

Accounts receivable factoring is distinct from using your accounts receivable as loan colla

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

Examples of combination products may in

eral because you are outright selling some or all of your receivable to a factor, such as a bank or insurance company, at a discount. You don't collect the debt owed to you from that accoun

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

t anymore, but you also don't have to worry about loan repayments. Accounts receivable factoring makes up about a third of all financing secured by American companies using accounts receiva

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

le and inventory as collateral; it's not an uncommon practice. And accounts receivable factoring can help you get large orders that you otherwise wouldn't be able to manage.

Consider the f

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

Combination pro

llowing scenario: you have ten thousand dollars in cash on hand, most of which is currently earmarked for payroll or debt payment. As a relatively new company, you don't have credit enough

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

to use your accounts receivable as collateral for a loan. A large new account becomes available, and you bid on it and win. The problem is, you only have a workforce of fifteen people, and

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

he new contract requires you to staff it with twenty people, purchase several new computers, and find space for the new staff to work out of. And you must do this immediately.

Your ten tho

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

usand dollars isn't enough to do this, and you can't get a loan. But you can engage in accounts receivable factoring, sell your current receivables at a small discount, and have the cash im

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

ediately on hand to hire the staff, rent the space, and purchase your necessary equipment.

Another possibility - you have a large amount owed to you as in accounts receivable, but one comp

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

ny is paying much too slowly, despite the penalties for late payment. You can sell your not-past-due accounts receivable to an accounts receivable factoring agent in order to maintain your

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

Following aspects would a

cash flow, and with penalties for late payment applied to the other company, you will probably break even.

Using Accounts Receivable Factoring Wisely

When you sell part of or all of an ac

dd to the challenges in developing combination products:

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

ount to an accounts receivable factoring company, try to get a personal recommendation for the company from a trusted associate: another company's officer, a trusted friend, a bank, etc. If

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

you can't, at the very least ensure your accounts receivable factoring agreement states exact conditions, charges, and procedures for the purchase of your accounts receivable.

And don't u

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

e accounts receivable factoring just as a way to get ready cash. Accounts receivable factoring can help you determine whether your payment terms are overly generous, whether the companies t

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

whom you're extending credit are credit worthy, and whether your collections arrangements are adequate for your business. When you speak to the agent arranging your accounts receivable fac

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

Professional from academic institutions, pharmaceutical industries, health care indust

toring, be it a broker or the actual funder, ask about these things. Accounts receivable factoring companies are interested in long-term ongoing relationships with companies, and will be ha

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

py to help you ensure your procedures and information concerning accounts receivable are adequate for your needs.

You should never use accounts receivable factoring for debts you suspect w

.

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

on't ever be paid. Again, you want to develop long-term relationships with accounts receivable factoring companies; they can help your company grow for a long time into the future. But if y

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

Companies that provide selfless information through particip

u sell them accounts they can't collect on, you can be certain they won't work with you again, and they may share that information with other accounts receivable factoring companies as well

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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