Research and Development in the Pharmaceutical Industry
How R&D tax relief applies to research and development in the pharmaceutical industry: drug discovery, formulation, clinical trials.
For R&D tax consultant services and how R&D tax credits work, see our dedicated pages.
research and development in the pharmaceutical industry and R&D tax credits: overview
Research and development in the pharmaceutical industry spans drug discovery, formulation, pre-clinical and clinical development, and related scientific work. R&D tax relief can apply to early-stage discovery, lead optimisation, formulation and process development, analytical method development, and—where the work meets the R&D test—certain clinical trial activities. Jurisdictions differ on which clinical trial costs qualify; a research and development tax consultant can clarify the rules for your region. Companies engaged in research and development in the pharmaceutical industry in the UK, UAE, or Ireland may be entitled to R&D tax credits on qualifying expenditure; eligibility and relief rates vary by jurisdiction.
Key areas for research and development in the pharmaceutical industry
Regulatory constraints and high-cost R&D
Pharma R&D is heavily regulated and often high-cost. Long project lifecycles and mixed qualifying versus non-qualifying phases make it important to document technical uncertainty and allocate costs in a way that satisfies both tax and regulatory expectations. R&D tax credits can materially reduce the cost of innovation when claims are well structured and supported by contemporaneous evidence. A research and development tax consultant with experience in the sector can help you separate qualifying R&D from routine or regulatory activities and build a defensible R&D tax claim process that stands up to review.
Eligible costs and R&D tax claim process
Common eligible costs include R&D staff time, CRO and subcontractor costs (subject to regime rules), materials and consumables, and certain equipment and software. Understanding how R&D tax credits work in your jurisdiction helps you plan projects and capture relief consistently. For support with the R&D tax claim process and ongoing compliance, see our R&D tax services. We offer readiness assessment, documentation systems, and ongoing advisory tailored to research and development in the pharmaceutical industry.
Drug discovery, formulation, and clinical trials
Discovery and screening, lead optimisation, pre-clinical and clinical development (where the work meets the R&D test), formulation and process development, analytical method development, and development of new delivery or manufacturing technologies. Tax authorities apply the same tests for qualifying R&D—advance in science or technology, resolution of scientific or technological uncertainty—but the boundary between qualifying and non-qualifying work can be complex in pharma; expert guidance helps. For an overview of R&D tax credit legislation and relief rates by region, see our learn pages on how R&D tax credits work and how much is R&D tax relief.
Related content
- All industries we supportOverview of R&D tax credits by industry
- R&D tax consultant servicesReadiness assessment, documentation, advisory
- How R&D tax credits workEligibility and relief by region
- Contact usDiscuss your R&D tax claim process
Ready to get started?
Tell us about your industry and we'll help you prepare for R&D tax relief in your region.
Get in touch