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One of the biggest challenges for Canadian company owners is obtaining business financing. As a first instinct, owners usu

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

ally try to go to the bank hoping for a business loan or line of credit. They soon find that qualifying for bank financing

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

Examples of combination products may in

is hard, as the bank will demand collateral and three years worth of financial statements. Although large companies can q

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

alify for bank funding, most small and midsized companies can’t. However, small companies are not out of options. There ar

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

e two alternatives.

If the business sells goods or services to other businesses and your main challenge is that they need

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

Combination pro

money to pay suppliers or employees, the solution could lie in using two little known financing products – invoice factor

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

ng and purchase order financing.

Most small and midsized businesses have cash flow problems because clients take 30 to 60

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

days to pay their invoices. Although waiting to get paid is a standard business practice in Canada, it can wreak havoc on

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’s finances. Because, while waiting to get paid, business owners still have to pay employees and suppliers, wh

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

coincidentally, don’t like waiting to get paid. Factoring financing can provide an advance on your invoices, supplying th

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

e cash flow the business needs to pay employees and suppliers.

Another common cash flow problem happens with a reseller g

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

Following aspects would a

ets a large order that he can’t afford to deliver. Usually, this happens because they don’t have money to pay their suppli

dd to the challenges in developing combination products:

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

rs for the goods they need. In this case, purchase order funding may be the solution. Purchase order funding provides pre-

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

delivery financing, allowing you to pay your suppliers and to deliver your orders. The transaction is settled once the end

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

customer pays.

Both factoring and purchase order financing have several advantages over business loans and conventional

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

ank financing. For starters, they are easy to obtain. Most small business owners that do business with reputable clients w

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

Professional from academic institutions, pharmaceutical industries, health care indust

ill qualify. Also, they can be implemented very quickly. Most companies can obtain funding within 5 to 10 business days.

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

However, factoring and purchase order financing are not for everyone. It will only work well if three things are true. Fir

.

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, you must sell to commercial customers. Consumer sales cannot be financed. Second, your profit margins must be at least

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

Companies that provide selfless information through particip

15%. And lastly, it will only help you if you have slow paying customers or if you need financing to fulfill a large order

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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