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When asking prospective clients in the UK if they have ever been in an IVA the most common response I get is 'what's an IVA?'

20 years ago in 1986 the insolvency act introduced the IVA. IVA stands for Individual Voluntary Arrangement A formal, it is court ratified, pr

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

ocess that allows somebody struggling with unsecured debts to make a payment proposal to their creditors.

IVA numbers are increasing dramatically at the time of writing. A record number of people in England and Wales went insolvent between July and September 2006. The

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

Examples of combination products may in

Insolvency Service said 27,644 people went bankrupt or entered into Individual Voluntary Arrangements to manage their debts.

Why are IVA's proving to be 'popular'?

Creditors like them because it can often provide greater returns than would normally be realise

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

d if the debtor went bankrupt.

Debtors like to make use of an IVA because it freezes interest on debts, it makes the payments more manageable, it protects their home, it is a very discreet debt solution (unlike bankruptcy) and allows company directors to retain their

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

position.

After a period of normally 60 monthly payments, any outstanding amounts of unsecured debts included in the IVA are written off.

That sounds great, how do I organise an IVA?

Well initially your unsecured debts need to be in excess of ?15,000. If you

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

Combination pro

have more than ?15,000 of unsecured debts and are struggling with debt repayments then it's time to talk to a professional.

Only qualified professionals can administer an IVA. This is usually an insolvency practitioner but there are a number of firms that have sprung

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

up to effectively 'package' an IVA ready for the insolvency practitioners to complete the IVA. The insolvency practitioner then becomes the trustee for the IVA.

To get an IVA agreed, a clear statement of your financial position will need to be drawn up. This will incl

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

ude all assets (house(s), cars, endowment policies, cash plans, pension details, etc) and then details of your monthly income and expenditure.

All these details are put to your creditors along with a proposed monthly payment.

What about my house?

Importantly,

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

if you own your own home, then any equity you have available in the property will form part of the IVA proposal as part of the repayment offer. A secured charge is applied to your property equivalent to the proposal put to the creditors. The charge is normally applied

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

to your property during the first year of the IVA and normally realised in the fourth year of the IVA.

If the property is jointly owned then only the debtors share of equity is normally considered under the IVA.

So what happens when the creditors vote on my IVA?<

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

/b>

The creditors vote on whether to accept the IVA proposal or not. If more than 75% by value of unsecured creditors vote in favour of the IVA then it has to be accepted by all the unsecured creditors.

What do you mean more than 75% by value?

Well if you hav

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

Following aspects would a

e 4 creditors but say one of them is owed 76% of your total amount of unsecured debts then it is only their vote that counts. If they accept the IVA proposal then the others will have to accept payments. Equally, if the 76% creditor declines the IVA proposal then the w

dd to the challenges in developing combination products:

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

hole proposal has been rejected.

What happens if my IVA is rejected?

Well first thing, remain calm. There is an opportunity to submit an improved IVA proposal if your funds allow. Failing that it may be time to consider an informal payment plan or perhaps even

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

bankruptcy. This is best discussed with a debt help and advice professional.

What if I miss any of my IVA payments?

A well drawn up IVA will allow for one or two missed payments in the IVA but missing payments is a serious business. The IVA is a court ratifie

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

d agreement. Missing payments in an IVA runs the real risk that the trustee will legally have to force you into bankruptcy.

What happens to the IVA if my circumstances alter?

If your circumstances alter then this needs to be reflected in your IVA. That means s

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

hould your income fall then the repayments should also be reduced. Equally, where your income improves then more money will be made available each month to your creditors.

Well I made it to the end of my IVA, what now?

The trustee will issue a 'Statement of Co

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

Professional from academic institutions, pharmaceutical industries, health care indust

mpletion' normally within 3 months of the last payment of the IVA. The trustee will also notify the Insolvency Service and reflect this in their records.

Finally, do be aware and get proper IVA advice.

Do sit down and get an experienced professional to go thr

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

ough everything in detail. Be aware of all the factors that will affect you if you decide to enter into an IVA. Whilst this article is accurate, it cannot be used to replace advice from a professional organisation.

Ed Pearson is a Debt Dr. Debt Dr specialise in debt h

.

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

elp and advice for individuals and small businesses. Ed can be contacted on 0845 123 4000 or in confidence on 07970 659266.

http://www.debtDr.co.uk 'prescribing life without debt'

This article does not constitute regulated advice. Please remember that

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

Companies that provide selfless information through particip

any action regarding financial advice should always be taken only after considering the specifics of your own situation.

To find out more about Ed try, www.ecademy.com/account.php?id=41788

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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