Main Subject - Finance

Many financial institutions both large and small are evaluating the merits of continuing to hold their own credit card portfolios. As the cost of competing in this sophistica

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

ted market, combined with the cost of fraud in both losses and increasing insurance premiums and escalating deductibles rises - now is the time to seriously consider capitali

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

Examples of combination products may in

ing on the unrealized premium your financial institution has built.

There are many reasons to consider divesting of your credit card portfolio; a few of them are as follows:

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

Are liquidity needs forcing you to buy high cost money?
Are you losing A+ and A cardholder balances to more attractive offerings?
Have you seen trends of escalatin

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

g losses in your portfolio?
Are you using valuable marketing dollars that would be better used for other services?
Have your members been asking for costly points p

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

Combination pro

ograms and alternative card choices?
Could your staff's time be better utilized in other loan programs and customer service areas that generate more to the bottom line?<

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

r> How can this be a better solution for my membership?

Your customer base will receive card choices such as Platinum, Gold and Classic cards. Many credit unions today simp

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

ly offer a single solution. Rewards programs that offer points or cash rebates. Consumers demand something extra for using your card vs. a multitude of other offers.

Family

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

accounts provide for credit lines for family members at a very young age, thus teaching credit responsibility and helping to build that very important credit score. Advanced

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

Fraud protection services, to protect the member and the financial institution. Large Call Centers that are available 24/ 7/365 and speak in multiple languages. How does my

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

credit union benefit?

Potentially receive a premium on the portfolio that enhances undivided earnings and benefits all members. Eliminates marketing expenses for credit car

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

Following aspects would a

d product which in many instances is in decline. Provides for competitive credit card solution with financial institution’s name on card that better meets the needs of your

dd to the challenges in developing combination products:

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

ustomer base. Provides for ongoing revenues for financial institution through card sales and card interchange income.

Potentially reduce labor expense by moving all card re

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

ated customer service to partner organization. Frees up staff to work on other service areas that promote the long term health and viability of the credit union. Allows fin

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

ancial institution to reinvest dollars currently invested in card portfolio into secured loans.

When does it make sense to keep my Portfolio?
When you have significant

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

iquidity (loans to shares 70% and under). When your effective yield on the portfolio is significantly higher than other possible loan or investment options.

When your credi

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

Professional from academic institutions, pharmaceutical industries, health care indust

card portfolio is growing and not stagnant or shrinking. When you are able to provide the features and functionality that your members/customers are seeking. When the yiel

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

d out weighs the risk.

Summary:

Having worked in the financial industry for some twenty-five years in both commercial banking and credit unions, I have experienced a number

.

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

of economic cycles. What provides me with greater pause than any of the economic cycles I have seen is the impact of the internet and the vulnerabilities and exposure that we

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

Companies that provide selfless information through particip

experience as financial institutions and as consumers.

When Banks with millions or billions of dollars in assets choose to divest of their credit card portfolios I take note

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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