Main Subject - Finance

The term “high risk” simply means the acquiring banks believe there is a higher risk of financial loss when underwriting particular businesses. With increasing

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

incidents of fraud on acquiring banks are becoming more risk adverse. Historically, high risk merchants tend to have greater levels of charge backs and may b

; 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 more susceptible to fraud, insolvency or other liabilities. Whether or not this is true for any particular business does not matter since all businesses within cert

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

ain parameters are grouped together.

Charge backs cost acquirers hundreds of millions of dollars each year. Losses from only one merchant can cost an acquirer millio

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

s of dollars. These days, few processors are willing pay for the highly qualified staff and aggressive monitoring systems necessary to mitigate risk across merchant ca

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

Combination pro

tegories. Managing risk and reserves of high risk merchants simply becomes too time consuming and expensive for most banks and processors.

Fast growing high

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

volume e commerce merchants in any industry are considered high risk. From the perspective of an acquirer, every dollar in sales is potentially a dollar in con

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

ingent liabilities. Additionally, certain industries are almost always high risk. (see link) .

Unfortunately, merchants in high risk categories often enco

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

unter difficulties expanding or diversifying merchant accounts . Even with a substantial processing history and low charge back ratios, a merchant may find tha

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

t few banks want to accept the account.

Sometimes merchants already have merchant accounts and believe the relationship with the acquiring bank is secure. Th

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

n, suddenly, the underwriting criteria of the bank changes. With very little notice, merchants may be asked to find another bank for processing. Or, rates and reserv

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

Following aspects would a

es on existing accounts may dramatically increase.

Additionally, the surge of bank mergers and acquisitions has increased the challenges a high risk merchant

dd to the challenges in developing combination products:

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

faces. A merchant may be shocked to learn the new entity no longer wishes to continue the merchant account relationship.

Offshore Merchant Accounts

High risk mer

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

chants must constantly be exploring new processing options. These days, it is no longer enough for a high risk merchant to have only one account. It is ent

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

rely too risky. Merchants are being forced to diversify accounts and seriously consider multiple jurisdictions to protect the future of their businesses

Offshore

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

merchant accounts are attractive to businesses for several reasons. First, offshore processors will accept merchants that domestic banks will not accept. Secondl

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

Professional from academic institutions, pharmaceutical industries, health care indust

y, a business may be seeking certain incentives or opportunities that are available in a particular jurisdiction. Third, some jurisdictions are more simply more toler

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

nt of certain merchant categories. Fourth, international merchant accounts frequently have no caps on processing volumes, which is helpful to rapidly expanding busine

.

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

sses.

Specific rules and regulations apply to offshore merchant processing accounts. It is wise to work with professionals who have expertise experience and

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

Companies that provide selfless information through particip

specialized knowledge to guide you in establishing your international merchant accounts . Resulting in your peace of mind and long term processing satisfaction

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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