Answers - Finance

We have all heard that we should start saving money as soon as possible, due to the fact that the earlier we start, the more we will have later in life. Now, while this is absolutely true, the question is, why? What is it about putting money away

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

long term that can turn hundreds into millions? The answer is compound interest.

The math and concept behind compound interest is easy enough: it is based on stuff we learned in middle school, and, just because we are now dealing with money, does

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

Examples of combination products may in

not have to become much more complicated. The process is simply this. Let us say you put $100 into a bank account (a CD, for example), paying you 5% annually. At the end of one year, you would now have $105 in the bank, so the second year you woul

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

be earning 5% on that $105. At the end of year two, therefore, you would have $110.25 (got to by taking 5% of the original $100 - $5 - plus 5% of the additional $5 – 25c). Year three, that would have grown to $115.76, year 4 to $121.55, and so on

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

So, what does this look like long term? After 10 years, that same $100 would be worth $162.89. After 20, the result is $265.33. After 189 years, your original $100 would be worth over $1M (finally).

Now, obviously, becoming a millionaire in 189

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

Combination pro

years time is not that exciting. What is exciting, though, is the results we can get by changing some of the numbers, because compound growth is exponential growth: it takes a little time to get going, but once it does, watch out!

So lets run the

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

same example, but play with the figures a bit. Lets say that, instead of just investing $100, you went through your chart of expenses (if you need this, email us at mailto:info@abundancebound.com, and put “Chart of Expenses” in the title), and wer

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

able to find $1 a day - $30 per month, to invest with. And lets say that all you did was invest this in index funds. (An index fund is a fund that basically mirrors market performance: depending on what you choose, you essentially own a piece of

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

very stock on the market). Index funds have historically grown at 11% (mutual funds, by the way, typically under-perform this – at least about 80% of them do – so when people encourage to just “put your money in mutual funds” remember that you are

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

, generally, paying for sub-standard service - yuck). That $30 per month would grow into $1M in just 53 years - much more exhilarating than the 189 above!

At this point, you may be saying “But I don’t want / don’t have 53 years to do this. I want

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

to be a millionaire sooner than that, and have money to spend on the way there”. So let’s say that you followed the steps of the Artists’ Prosperity System), went to work, and you are now in a place to put away $100 per month. Let’s also assume th

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

Following aspects would a

t you did your research, and went after more aggressive investments – direct investing vs. “park and pray” – so that your returns were 20% annually. At this rate, you would become a millionaire in 27 years – well within reach of any of us. And tha

dd to the challenges in developing combination products:

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

is still only putting away $100 per month! How about a $1,000 per month? That will turn into $1M in 14 years. $2,000 per month? 11 years… You get the idea.

Now, those numbers may seem like a lot, to some of you. If you are caught in the throws o

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

f struggling to pay the bills, put time into your artistic career, and juggle all the other things you want and need to do, an extra $100 per month seems a lot to come by. That is where education comes in. Learn how to put money away, fore-cast, p

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

y down some debt, and increase your income. Then, as your career takes of, and your business flourishes, can you see putting that $100 a month away? Then the $1,000? And the $2,000? More? It is extremely doable. All it takes is education, and a li

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

tle time.

Our hope is that everyone will read this and be inspired to take action about their finances. Be it putting $30 a month into index funds (fool.com is an excellent resource for stock info, allowing you to paper trade etc while you get yo

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

Professional from academic institutions, pharmaceutical industries, health care indust

rself comfortable), or taking our Artists’ Prosperity Boot Camp, and eventually branching out into Real Estate, Tax Liens and Oil & Gas, the key is action! What are you going to start doing now that will mean life will be different for you two, fi

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

ve or ten years from now?

There will always be people who will question our advice, who think that investment gains of more than 10% are impossible etc (although they should ask Warren Buffet about that). I am sure, in the same vein, that there w

.

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

re people who questioned your choice of pursuing the arts (I know there were plenty of those for me!) I want to leave you with this quote, again from The Motley Fool, because it sums up the choices we have as we go through our lives: “The least me

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

Companies that provide selfless information through particip

tioned, biggest risk of all is not taking enough risk”. In a country where 90% of people die poor, compound interest can mean you are one of the 10% who doesn’t. Understand it, examine it, research it… then get out there and put it to work for you

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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Many ventures are faced with the challenging task of raising venture capital. The first part of this process is finding the right venture capital firm (VC). While this may seem simple, it isn’t. There are thousands of venture capital firms in the United States alone, and going after the wrong ones is one of the most common reasons why companies fail to raise the capital they need.

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Answers - Compound Interest - How to Turn $100s into $1,000,000s

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