Pharmaceuticals

The Orphan Drug Tax Credit provides a 25% tax credit for qualified clinical testing expenses for drugs that treat rare diseases affecting fewer than 200,000 people in the US. This credit can be enormously valuable for companies developing rare disease therapies. SMAART identifies qualifying drugs, documents eligible expenses, and ensures full compliance with IRS requirements.

Pharmaceutical collaboration agreements are accounted for under ASC 808 (Collaborative Arrangements). These require careful analysis to determine whether each party is acting as a principal or agent, how to classify payments between participants, and how to apply ASC 606 to any license or milestone payments within the agreement.

Under GAAP, internal R&D costs including clinical trial costs must generally be expensed as incurred. Section 174 requires amortization of R&E costs over 5 years (domestic) or 15 years (foreign) for tax purposes, creating a significant book-tax difference. SMAART manages both the accounting and tax treatment of drug development costs.

Yes. SMAART provides fractional CFO services, board financial reporting, investor due diligence support, and grant accounting for pre-revenue pharmaceutical and biotech companies. We understand the unique requirements of development-stage companies and help build the accounting infrastructure that supports clinical progress and future fundraising.