Multinational Clinical Trials and SR&ED (2001)

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At SREDucation, we’re taking the time to document all of the changes that have occurred to the SR&ED program over the years. In our “From the Archives” series, you’ll be able to see how the program has evolved since its inception in 1986. For a timeline of these events, check out the SR&ED Tax Credit page on Facebook. Stay current with the program by understanding the historical context. 

CRA View on Multinational Clinical Trials and SR&ED

On May 17, 2001, the Canada Revenue Agency issued an application policy notice concerning how Canadian claimants for SR&ED can obtain tax credits for multinational clinical trials in Canada. The agency clarified that this is not a statement of policy concerning work done outside of Canada, so the policy applies within Canada only.

“Multinational clinical trials represent collaborative research, where the work is distributed among various countries and is pursued concurrently,” the application policy notice stated.

“The contribution of the Canadian claimant to a multinational clinical trial (i.e., the work undertaken in Canada) must meet the definition of SR&ED in order to be eligible.”

To come up with the clarified rules, the CRA consulted with the pharmaceutical/biopharmaceutical industry as well as the medical research community.

SR&ED Eligibility

The CRA considered two cases: when subject accrual happens, and when it does not.

When subject accrual occurs, the study is SR&ED eligible when

  • The study works to “advance scientific knowledge”;
  • Canadians evaluate scientific content and do a benefit vs. harm analysis;
  • The research is based on established scientific protocols; and
  • Records are kept.

When subject accrual does not occur, the study is SR&ED eligible when Canadians give “input provided into aspects such as study design, protocol development, interpretation of results and/or participation in scientific monitoring boards.”

Work that Does not Qualify for SR&ED

CRA also included a list of situations that do not qualify for SR&ED. Some of the items were:

  •  Information-collecting surveys;
  • “Passive monitoring” (usually to look at whether patients were experiencing unexpected adverse reactions to drugs);
  • Clinical trials intended to confirm previous trials, specifically in the realms of “safety and efficacy”;
  • Screening databases “for descriptive purposes only.”

This article is based upon a Government of Canada application policy issued at the time: Application Policy: Multinational Clinical Trials.

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