Useful Articles - Real Estate

Today, it’s no secret that most baby boomers are now playing ‘catch-up’ with their retirement funding. In just two generations, the career world has been completely transformed. Lifetime employment at a single employer with a gold watch and a guaranteed pension at the end is now a relic of

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

the past. Moreover, once ‘un-touchable’ social security trust funds have been routinely invaded by heavy Congressional borrowing for decades. It’s not uncommon today for people to change jobs, homes or locations every few years. Most now realize they have primarily responsibility for the si

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

Examples of combination products may in

e of their retirement income. But at the same time, with longer life expectancy, improved health care and better lifestyle choices, most adults know that inflation will decrease the purchasing power of social security benefits. However, many have relied solely on the Social Security as thei

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

sole means of saving for retirement. They now know that will mean living in poverty during their retirement years.

SELF-DIRECTED RETIREMENT ACCOUNTS.

If you are a part-time or full-time investor or are a business owner, you have the best chance of controlling the size an

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

d the timing of your retirement. The better options are yours if you first establish a corporation, a limited liability company or a limited partnership that you manage. Under improved legislation, the dollar limits on contributions have gone up and the range of investment choices expanded.

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

Combination pro

So why pay someone to manage your retirement and ’hope for the best’ in the stock market when you can directly control your own retirement destiny? Investing in assets you know and understand provides a way to limit your downside risk and may give you better control of the outcomes. Plus pr

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

fits in the IRA are free of capital gains taxes so the total dollar value of your IRA can grow much faster over the years.

MORE CHOICES AVAILABLE TODAY.

With a Self-Directed IRA or Self-Directed 401(k), you act as your own investment manager. Besides the usual choices of

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

stocks, bonds, mutual funds, options, etc. you can now invest in a wider range of non-traditional assets including:

• Real Estate Investment Property
• Mortgages and Deeds of Trust
• Tax Liens Certificates
• Promissory Notes / Commercial Paper<

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

r> • Private Stock Offerings
• Real Estate Lease / Options
• Limited Liability Companies
• Limited Partnerships
• Business Equipment Leasing
• Structured Settlements
• Mobile Homes Rentals
• Foreign Currency Exchanges
• Accounts Receivable Fa

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

toring
• Secured and Unsecured Notes

MAXIMIZING YOUR CONTRIBUTIONS.

Today, real estate investors can take full advantage of small business retirement plans. These are just as easy to set up as the traditional or Roth IRAs but allow individuals to contribute cons

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

derably more than the allowances for those plans. The small business retirement plans include the SEP (Simplified Employee Pension Plan) IRA, the SIMPLE (Savings Incentive Match Plan for Employees) and the Solo 401(k) Plans. For example, there are two components in maximizing the Solo 401(k

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

Following aspects would a

) plan: (1) An employee salary deferral contribution up to $15,000 (not to exceed 100% of pay); and (2) An employer profit-sharing contribution with a limit up to 25% of pay (20% for self-employed). The total contribution from both sources is $44,000 but with a ‘catch up’ provision for indi

dd to the challenges in developing combination products:

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

iduals age 50+ who can contribute another $5,000 for a $49,000 annual contribution.

HOW TO STAY IN COMPLIANCE.

To maintain the tax-advantages of your Self-Directed Retirement Account, you need to avoid what the IRS calls ‘Prohibited Transactions’ (which are basically self

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

dealing type of transactions). These include selling personal property to your IRA; using your IRA as security for a loan; borrowing money from your own IRA; purchasing property for personal use with IRA funds (must be for investment purposes only); using IRA funds purchase collectibles suc

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

h as artwork, antiques etc. (although certain U.S. minted coins might be exceptions); purchasing assets owned by yourself or your spouse with IRA funds; and having your business located in a property owned by your IRA.

PROVIDING FOR ASSET PROTECTION.

Self-Directed IRAs an

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

Solo 401(k) plans can (for liability protection) become ‘members’ of a Limited Liability Company (‘LLC’). While not required, it is the ‘smarter way to go’ in preserving value and reducing liability risks - no matter what state you’re in. In fact, your Self-Directed IRA or Self-Directed So

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

Professional from academic institutions, pharmaceutical industries, health care indust

o 401(k) can become an LLC member alongside the accounts of other co-investors and together combine your IRAs for greater investment results. The LLC Operating Agreement for Self-Directed Retirement Accounts is different than other LLCs and provides a specific framework in which to operate

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

the Investment LLC as your Self-Directed Retirement Account so that everything is ready for investing at about the same time.

SETTING UP YOUR SELF-DIRECTED PLAN.

After months of looking at different providers, I found that for simplicity, ease-of-use and online 24/7 acces

.

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

with downloadable forms and instructions, Equity Trust Company (in Ohio) was one of the most helpful Self-Directed IRA or Self-Directed Solo 401(k) Plan custodians. They are the originators and they will hold your hand as you learn the ropes. There are certainly others who are capable, but

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

Companies that provide selfless information through particip

I found Equity Trust Company to be among the most ‘user-friendly’. My contact there is Mr. Tim Debronsky, whose e-mail address is t.debronsky@trustetc.com. Tim’s direct phone number is (440) 323-5491 (ext 329). Early in the conversation ask Tim to send you the ‘real estate investor package’

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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